Mining Companies Intimidate Indonesia with Immoral Threats of International Arbitration

Mining companies threaten protected forests in Indonesia

One hundred and fifty mining companies are lobbying the Indonesian government to open , 11,441,852 hectares of protected areas for mining. According to Indonesia's Director General of Geology and Mineral Resources, Wimpie S. Tjethpe, quoted in "Koran Tempo" (April 3 2002) 50 companies are conducting operations in protected forest areas.

The Koran article also states there are plans for US$3,2 billion worth of investment in the Nusa Tenggara area by four mining companies but thus far they have been hindered by the Forestry Act. These companies are PT Gag Nikel (BHP Billiton), PT Weda Bay, PT Nusa Halmahera and PT Citra Palu Mineral (Rio Tinto).

The Koran Tempo Article also had a chart of the mining companies associated with protected areas along with their multi-million dollar amounts of investment up to 2001. These companies include Freeport, Meratus Sumber Mas (Placer Dome), CPM (Rio Tinto/Newcrest), Newmont Nusa Tenggara, Galuh Cempaka (BM Diamondcorp), Inco, Barisan Tropical Mining, KEM (Rio Tinto) Meares Soputan Mining, Newmont Minahasa Raya, Nusa Halmahera, Weda Bay, Gag Nikel (BHP-Billiton), Arutmin, among others.

PRESS RELEASE, from JATAM and WALHI, Jakarta April 4 2002

Mining Companies Intimidate Indonesia with Immoral Threats of International Arbitration

The industry also claims that this situation adds to legal uncertainty of investors in the country especially foreign investors. (Koran Tempo, 3 April 2002)

The Indonesian government and people do not need to be worried about this threat at all since it is without basis, for the following reasons:

1. The contract that they signed requires them to respect effective legislation, including the Forestry Act.

2. Thus the mining companies argument that the government has ban all mining ventures in protected forest areas is without merit.

3. Indonesia must consider the importance on a global scale and not just from the economic spectrum that protects the interests of investors. At the moment the destruction of Indonesian forest has reached 2 million hectares per year, this is very alarming for Indonesia and the rest of the world. It is certain that the public will provide support for the interests of conservation of protected areas and not for mining activities that clearly destroy and bring little benefit to Indonesia.

4. All mining contracts in protected areas were signed during the authoritative government period that did not care about the environment, human rights and indigenous communities. Thus it is certain that arbitration will not gain international support, especially from the home
countries of these mining companies. Because of this, the government is urged not to allow conditions that will cause destruction only for the satisfying of mining interests.

5. Indonesia has ratified the Convention of Biodiversity (CBD), agreed to the Statement of Forest Principles, and has become part of the United Nations Forest Forum (UNFF). This means that Indonesia must be highly committed to implementing these principles. Rightfully so, other countries and international organizations value this position.

Article 7 of the CBD states that Countries are obligated to prevent negative impacts from forest exploitation activities, meanwhile Article 8 CBD states that countries must develop protected areas with the goal of conservation of those areas. As follow up, Indonesia has issued Act No. 5/1994 concerning the Ratification of the Convention on Biodiversity.

Various reasons outlined above to protect Indonesias forests are also strengthened by the current conditions of the forests of Indonesia. The closing of the remaining forests in Indonesia is needed since only 98 million hectares remain and at least half is believed to be experiencing degradation as a result of human activities.

Based on the above considerations, we hereby state that we:

1. Support the efforts of the Department of Forestry and associated groups that reject the change in status and function of protected areas into mining areas.

2. Regret statements made by Wempi S. Tjejep, from the Department of Energy and Mineral Resources (ESDM) about mining and protected areas. As a public institution, the Department of Energy and Mineral Resources must consider the interests of the community and not issue statements that support the interests of investment.

3. Demand that the government take into account the true value of local community losses and environmental destruction as a result of the mining practices that have occurred up until now. Therefore, neglect and untruth is apparent in the mining industrys position that the function of forests need to be change based on economic value that can be obtained from the mining sector.

4. For example, Canadian Fisheries Regulations issued in 1977 have the power to prohibit mining companies already in operation from disposing of their tailings into the ocean, even before these regulations were issued.

5. Will support the Government, with gathering public support and lawyers, to defend the interests of the country of Indonesia if brought to international arbitration.

For more information, please contact:
Tel: 021-7941559
Email: mai@jatam.org

Farah Sofa, WALI
Tel. 021-7941672
Email : ovi@walhi.or.id