An agreement signed yesterday in Jakarta requires Newmont Mining Company to pay 30 million to settle a civil court case that charges the Denver-based company with polluting Buyat Bay on North Sulawesi island. The out-of-court settlement in the civil case has no bearing on the ongoing criminal trial of Newmont executives in Indonesia who are charged with not taking action to prevent pollution.
The 30 million settlement is good news in the sense that the funds will be used to monitor health and environmental effects of the now-closed Newmont Minahasa Raya mine and provide health care to the affected populations. Newmont, of course, admits no guilt, but local environmental organizations feel some satisfaction that their activism, supported by Global Response and other international NGOs, forced accountability on the Indonesian government and the world;s largest gold mining company.
Sincere thanks to everyone who wrote letters to Indonesian government officials and Newmont executives on behalf of the Buyat Bay communities. We all played an important part in bringing this about!
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Newmont to Pay 30 Million to End Pollution Suit
By ZAKKI HAKIM, Associated Press Writer
Thu Feb 16, 2:07 AM ET
JAKARTA, Indonesia - Newmont Mining Corp. agreed Thursday to pay Indonesia 30 million in an out-of-court settlement, ending one of two legal battles over allegations the company dumped tons of toxic waste into a bay, sickening villagers.
The deal closes a civil suit filed by the government, but has no impact on an ongoing criminal trial of the U.S. gold mining giant's top local executive, who is accused of knowingly dumping dangerous amounts of arsenic and other heavy metals into Buyat Bay on Sulawesi Island, 1,300 miles northeast of Jakarta.
Newmont's local subsidiary said it would pay million over 10 years to fund environmental monitoring and community development around the gold mine in exchange for the government dropping the case.
"This is the best solution in solving this problem in the interests of the people of north Sulawesi," said Social Welfare Minister Aburizal Bakrie.
The Environment Ministry filed the suit last year and had been asking for 133.6 million in damages to compensate for the alleged pollution from arsenic-laced waste rock pumped onto the ocean floor. Arsenic and other heavy metals are used to separate gold from ore.
Robert Gallagher, Newmont's vice president of Indonesian operations, said the deal "reaffirmed our long term presence and investment in Indonesia and our commitment to the communities where we operate."
Newmont operates another massive gold and copper mine on Sumbawa in the far east of the country, and is planning more operations on the same island.
The company's legal troubles in Indonesia are being closely watched by foreign investors already anxious about the country's weak legal system, as well as by environmentalists eager to see if the government will punish a multinational mining company for the first time in recent history.
The criminal case against the company is being heard in Manado, the capital of north Sulawesi province. Richard Ness, the American president director of Newmont Minahasa Raya, the Denver-based company's Indonesian subsidiary, faces up to 10 years in prison if convicted. A verdict is expected later this year.
Prosecutors at the trial say Newmont violated environmental laws by dumping the waste, and allege villagers develop skin diseases and other illnesses as a result.
Newmont insists there was no pollution in the bay and the police investigation was flawed.
It says several studies have shown that the levels of mercury and arsenic in the bay are well below Indonesia's maximum allowable levels.
Newmont began operations in Sulawesi in 1996, and stopped mining two years ago after extracting all the gold it could. But it continued processing ore until Aug. 31, 2004, when the mine was permanently shut.
