Spurred by Illness, Indonesians Lash Out at U.S. Mining Giant

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http://www.nytimes.com/2004/09/08/international/asia/08indo.html?th

 

September 8, 2004

Spurred by Illness, Indonesians Lash Out at U.S.

Mining Giant

By JANE PERLEZ and EVELYN RUSLI

 

BUYAT BAY BEACH, Indonesia - First the fish began to

disappear. Then villagers began developing strange

rashes and bumps. Finally in January, Masna Stirman,

aided by a $1.50 wet nurse, gave birth to a tiny,

shriveled girl with small lumps and wrinkled skin.

 

" The nurse said: 'Ma'am, the baby has deformities,' "

Mrs. Stirman, 39, recalled in an interview. Unable to

get any meaningful medical help in this remote fishing

village of about 300 people, she watched as her fourth

child suffered for months and then died in July.

 

The infant's death came after years of complaints by

local fishermen about waste dumped in the ocean by the

owner of a nearby gold mine, the Newmont Mining

Corporation, the world's biggest gold producer, based

in Denver. It also kicked up a political brawl pitting

Indonesia's feisty environmental groups against the

American mining giant, which has been trailed by

allegations of pollution on four continents.

 

The fight has aroused intense interest in mining

circles and among environmental groups for the fresh

concerns it raises about how rich multinational

companies - especially those that extract resources

like coal, copper and gold as well as oil and natural

gas - conduct themselves in poor nations.

 

For Newmont, the battle is only the latest round of

troubles as the company, concerned by the more

stringent rules for mining permits in the United

States, seeks greater growth from operations overseas,

where environmental groups and, increasingly,

government officials charge that it employs practices

not tolerated at home.

 

No definitive cause has been found for the illnesses

among the villagers. Company executives, Newmont said

in a statement, were " convinced that we are not

polluting the waters of Buyat Bay or adversely

affecting the health of the people in that area. "

 

But on Aug. 31, an Indonesian government panel

announced that Newmont " had illegally disposed " of

waste containing arsenic and mercury in the ocean near

the mine site, and had failed to get the required

permits from the Ministry of Environment since 1996.

The environment minister, Nabiel Makarim, said the

company might face criminal charges.

 

The findings came a week after a local legal aid group

filed a suit on behalf of three villagers, including

the baby's mother, in a district court in South

Jakarta, alleging that they and the baby had been made

sick by the mine waste. They are seeking $543 million

in damages.

 

The company denied the charges and said in its

statement that it " operates in full compliance with

Indonesian and U.S. environmental standards. "

 

Newmont has run into trouble before, even at home. But

some of the gravest allegations of polluting mining

practices have come from its operations in developing

nations, from Indonesia to Peru to Turkey.

 

Here, the fight with Newmont has fueled a growing

popular impression that mining and energy companies

hold a tight grip over Indonesia's weak regulatory

system. Many blame the corruption, cronyism and

unevolved legal structure inherited from General

Suharto, the dictator whose rule ended in 1998 and

who, for a price, eagerly opened the doors to foreign

investors.

 

When Newmont first came looking for gold in Indonesia

in the 1980's, it dealt with the Suharto government.

Since then, a handful of officials knowledgeable about

the environment have said they wanted to stand up to

Newmont and other companies, but lost the battles.

 

In Newmont's case, correspondence shows that from 2000

to 2002 the Ministry of Environment challenged Newmont

about the toxicity of the mine waste it was dumping at

Buyat Bay. In a letter to Newmont in March 2002, a

senior ministry official, Isa Karnisa Ardiputra,

listed seven points of concern and asked for

" immediate action. "

 

In an interview at Newmont's Jakarta headquarters on

Aug. 27, the president of Newmont in Indonesia,

Richard B. Ness, and other company officials said they

were not aware of the letter.

 

Emil Salim, a minister of the environment during the

Suharto era, who is overseeing the panel that found

Newmont had acted illegally, reflected the anger of

many Indonesians over the dumping of waste that was

allowed to go on for years despite such challenges

from parts of the government.

 

" We are weak in governance in mining, " he said. Using

the mine industry's word to describe the waste, Mr.

Salim said he had told the company: " I am not against

you. But please don't put your tailings in our ocean. "

 

Some sense a potential turning point in the outrage

stirred by the death of Mrs. Stirman's baby.

 

The mother was told by a doctor, Sandra Rotty, an

Indonesian who works at the Newmont financed health

center at nearby Ratatok, that the child had a common

skin disease. After examining the baby in April, Dr.

Rotty wrote to a local environmental group, Kelola,

that the baby's skin " disorder " was " caused by

malnutrition. "

 

" Now, the baby's condition is already better, " she

added.

 

When the child showed no improvement, however, the

group asked a team of public health doctors to visit

Buyat Bay.

 

About 120 villagers were waiting to be examined in

June in the ad hoc clinic set up in three local homes.

Thirty of the villagers had tumor-like growths, said

one of the doctors, Jane Pangemanan.

 

" I was shocked by what I saw, " she said in an

interview. Of the 60 people she examined, about 80

percent showed symptoms of poisoning by mercury and

arsenic, she said.

 

On a recent visit to the community, and judging from

the villagers who came to the Jakarta courthouse for

the opening of the case on Aug. 27, the health

problems were evident at almost every turn.

 

One of the babies had a cyst the size of a small pea

on the end of her tongue. A mother had two lumps on

her breasts the size of golf balls. One woman had a

large lump down her left side that made her look half

pregnant.

 

A lawyer for Newmont, Palmer Situmorang, said the

lumps and skin diseases that the villagers complained

about were the result of " poor sanitation and poor

nutrition. "

 

" They are liars because their orientation is to just

get money, " he said.

 

But an environmental scientist, Evan Edinger, who is

an assistant professor at the University of

Newfoundland in Canada and who is working with the

Indonesian environmental group Friends of the Earth,

said he believed that arsenic in the mine waste was

the main cause of the illnesses.

 

In laboratory tests in Canada, he found that about 30

percent of the arsenic in the sediment from Buyat Bay

was soluble in weak acid environments, like the

digestive tracts of worms, he said in an interview.

 

" Our hypothesis is that if you have sediment-feeding

organisms and bottom-dwelling fish eat them, then that

could be the pathway to contamination from arsenic, "

Mr. Edinger said.

 

Newmont's own laboratory results also show high levels

of arsenic in the sediment. But the company contends

that the arsenic remains inert and nonsoluble in the

ocean.

 

In a paper released to the news media, Newmont said

that " collectively, there is no scientific evidence to

suggest that mining activity at Minahasa has resulted

in arsenic contamination of Buyat Bay biological

ecosystem. "

 

The national police chief in Indonesia, Gen. Da'i

Bachtiar, released the police's own laboratory results

in August that showed mercury contamination of the

sea. The company disputed the results, saying the

police did not measure dissolved mercury.

 

But General Da'i's chief investigator in the case,

Sulistiandriatmoko, retorted: " We are not that stupid.

We measured the dissolved mercury, not the total

mercury. I think they are just trying to distort the

case. "

 

The Newmont mine above Buyat Bay is on the northern

tip of Sulawesi in Minahasa, a region where fishermen

in handmade wooden boats have been trawling for

hundreds of years. Where small vanilla, clove and

coconut plantations once prospered, Newmont carved

five pits into the brown earth.

 

With its relatively low costs and high-grade gold that

was easy to get at, it was a " little model of a mine, "

said Ali Sahami, a geologist who works as one of

Newmont's environmental advisers. At the height of

production from 1998 to 2000, the mine was producing

nearly 25 percent of the company's international

output.

 

Newmont finished mining in 2001 and has since been

processing mined ore, work it was scheduled to

complete on Aug. 31.

 

Villagers say the fish off their beach were once so

plentiful they would start a fire for grilling before

setting off to catch the evening meal. But almost

immediately after mining operations started, the fish

stocks dropped dramatically.

 

Rasit Rahman, a squat man with a thick tangle of black

hair, who had a lump removed from the back of his neck

recently, was one of the plaintiffs who appeared in

court on Aug. 27.

 

" My catch dwindled so fast after the mine came, I

could no longer afford to send my youngest son to

school, " he said. Before the mine company came to the

area in 1996, he said, he could earn $30 a day, a

substantial amount in a village without electricity

and running water. " We had to look for another place

to catch fish, " he said. " It was so much harder, and

we were getting so little. "

 

At issue is Newmont's use of a waste disposal method,

effectively banned in the United States under the

Clean Water Act, that is called submarine tailing

disposal. It involves piping treated mine waste into

the ocean.

 

Newmont uses the method not only at the mine near

Buyat Bay, but also at its far bigger copper and gold

mine on the island of Sumbawa.

 

The legal aid group, Agency for Health Law, which has

brought the suit on behalf of the villagers, charges

that the system polluted the warm equatorial waters

around the village, where people depend almost

exclusively on fish for food as well as for their

livelihoods.

 

In the interview at the company's headquarters, Mr.

Ness, the Newmont president in Indonesia, defended the

use of the waste system. He also made that case before

an Indonesian parliamentary committee in August.

 

He said it was more " responsible " to put the waste in

the sea than store it on land that could be subject to

earthquakes. Furthermore, he said, " Tailings are

nothing more than ground-up rock. "

 

Others disagree. Environmental groups vociferously

oppose the sea disposal of waste. Some mining

companies, like the Australian giant BHP Billiton, say

they would not use such a method in current projects,

even though it is cheaper than land-based waste

storage.

 

Robert E. Moran, a hydrogeologist who advises mining

companies and environmental groups, said in a

telephone interview from Colorado that " clearly

tailings are much more complex chemically than crushed

rock - or else they would not require detoxification

treatment prior to disposal. "

 

The waste from the mine being released into the sea

amounted to a potentially " toxic soup, " he said.

 

Mr. Moran, who reviewed partial analyses from the

plant made available by Newmont, said he was confident

that the waste consisted of metal-like elements like

arsenic and antimony and metals like mercury, cadmium,

lead, copper and zinc.

 

Those substances in the rock where the gold is found,

he said, are treated with sodium cyanide, and the

subsequent mixture is treated again with other

chemicals in an attempt to reduce the concentration of

cyanides.

 

In all likelihood, Mr. Moran said, some amount of

cyanide compounds and other organic chemicals remained

in the waste that was released into the ocean less

than a half mile off shore at a relatively shallow

depth of about 82 meters.

 

In tropical waters like those around Buyat Bay, the

toxic compounds often became " more mobile and more

accessible to the food chain than in temperate

waters, " Mr. Moran said.

 

Washington's political risk insurance agency, the

Overseas Private Investment Corporation, does not like

the submarine tailing disposal system, either. In the

late 1990's, the agency refused to give insurance to a

mine operated by Rio Tinto in Papua New Guinea on the

grounds that the mine's submarine tailing system would

violate United States domestic regulations.

 

Newmont will essentially leave the site near Buyat Bay

early next year, although a small skeleton staff will

be on hand for three years to complete reclamation and

oversee some community development projects, Newmont

officials said.

 

To its critics, Newmont says its mine closure plan

will leave a community better off than when the

company arrived. The plan shows photographs of a new

school and groups of happy children splashing in clean

water.

 

But the villagers at the beach say they are

uninterested. They are no longer able to sell their

fish in the local markets. In addition to the

illnesses that many now suffer, their livelihoods are

shattered, said Anwar Stirman, the brother of Mrs.

Stirman.

 

" We can no longer make money from the fish, " Mr.

Stirman said. " We're talking to the provincial

officials about our future. The whole village is

waiting to be moved to another location. "

 

In any event, Newmont contends that the sea at Buyat

Bay is in fine shape. The company ran color

advertisements saying so in 10 Indonesian newspapers

at the end of August.

 

" We find the water is in excellent condition, " said

Robert Humberson, general manager for external

relations. " I dive there myself. It's fabulous. "

 

Copyright 2004 The New York Times Company