WALHI welcomes strong criminal indictment of Newmont

WALHI welcomes strong criminal indictment of Newmont

Indonesian Forum for Environment (WALHI) Media Release

5 Aug 2005

Jakarta (Indonesia), Aug 5 2005 -- The Indonesian Forum for Environment (WALHI), Indonesia's largest grassroots based environment organisation today welcomed the indictment prepared by the Public Prosecutors Office. The indictment names two accused in the Buyat Bay pollution case: PT Newmont Minahasa Raya; and President Director of PT Newmont Minahasa Raya Director Richard Bruce Ness personally. The indictment was read today in Manado District Court, North Sulawesi province.

P Raja Siregar, spokesperson for WALHI said: "For 30 years giant mining companies have operated in Indonesia with impunity despite shocking environmental practices. They have taken advantage of a failure in law enforcement by the government."

"The evidence shows that from when Newmont began tailings disposal into Buyat Bay in 1997, until the mine closed in 2004, Newmont breached not just international standards, but specific Indonesian laws. This prosecution will succeed if the trial is conducted fairly, and all evidence is submitted, inculding for example the government-convened Joint Technical Team report."

"This sends a clear message to investors. If mining companies run their businesses properly, they won't face legal action. But if their operations adversely impact the environment, they will be sued: by the community through class actions, by NGOs in the public interest and by the government to enforce the law", concluded Siregar. [ends]

Contact for Comment:
P. Raja Siregar, WALHI +62 8111 53349

For technical briefing:
Igor O'Neill, WALHI +62 812 861 2286

Please see attached documents:
• An English language summary of the Criminal Indictment read today in Manado supreme court; and
• background information showing that Newmont's defence, which refers to the CSIRO and WHO reports, is on shaky ground
• The key conclusions of the government-convened Joint Technical Team report.

Media Briefing 5 Aug 2005
Indonesian Forum for Environment (WALHI)

According to the Criminal Indictment of Newmont / Ness :

• The Accused: The indictment from the Public Prosecutors Office names two accused: (1) PT Newmont Minahasa Raya; (2) Richard Bruce Ness personally. According to the indictment, Ness is indicted because:
o as President Director of PT Newmont Minahasa Raya, Richard Ness had the responsibility to supervise and direct staff below him so that they carried out their duties according to requirements set by laws and regulations which apply in Indonesia.
o as President Director of PT Newmont Minahasa Raya, Richard Ness did not in fact take steps to prevent numerous (listed) breaches of applicable water quality limits.
o Richard Ness did not take concerted steps so that PT Newmont Minahasa Raya could gain a toxic waste disposal permit, even although he knew PT NMR did not hold a license to dump tailings into the sea; but instead he continued to allow the tailings dumping.

• The accused broke the law through deliberate action by causing pollution and/or environmental damage including a decline in sea water quality:
The indictment states that the accused disposed of tailings into the sea, not below the Thermocline layer but instead into the mixed layer, so that:
o The liquid portion of the tailings were immediately mixed by wave action, currents and tides so that the heavy metals contained in the tailings liquor were spread both vertically and horizontally;
o The solid portion of the tailings were also churned by wave action, currents and tides so that the heavy metals contained in the solids so agitated were also able to dissolve and thus were likewise spread around;

• Newmont disposed of Dangerous and Toxic Waste into the sea ("B3 waste") without a permit from 2001 to 2004:
Newmont's mine is deemed to produce Dangerous and Toxic Waste ("B3 waste"), in part because chemicals used by the accused include Cyanide (CN), and the waste produced contains Mercury (Hg) and Arsenic (As); Meanwhile Government Regulation Controlling Pollution or Damage to the Sea states that disposal of dangerous or toxic (B3) waste requires a special permit from the Minister. A letter from Environment Minister Sonny Keraf on 11 Jan 2001 required Newmont to submit a valid Ecological Risk Assessment (ERA) for the tailings disposal into Buyat Bay in order to qualify for a permit. Newmont did submit an ERA but it was deemed unsatisfactory due to sub-standard study protocols, data quantity and quality and a lack of expert and public consultation. This failure to fulfill the requirement of a valid ERA meant that the Environment Minister acting as head of the Environment Protection Agency did not issue a permit for ocean disposal of tailings, but that the accused, Newmont, continued to conduct the disposal after 2001 until 2004 without holding a permit.

• Newmont's tailings detoxification was unreliable and breached specific emission and water quality standards on 125 occasions:
The indictment includes a list almost 4 pages long of 125 occasions between 1997 and 2004 when Newmont's tailings breached Indonesian emissions and water quality standards for:
o Arsenic (As); eg. August 1999: 2.42mg/l, approx 5 times over limit of 0.5mg/l
o Cyanide (CN); eg. May 1998: 1.53mg/l, approx 3 times over limit of 0.5mg/l
o Mercury (Hg); eg. August 2000: 132.8µg/l, approx 16 times over limit of 8µg/l
o Iron (Fe); eg. July 2001: 101.8mg/l, approx 33 times over limit of 3.0mg/l
o Copper (Cu); eg. Jan 2004: 2.42mg/l, approx 2.5 times over limit of 1.0mg/l

• Sampling by the Police Forensic Laboratory found Buyat River water and Buyat Bay seawater contaminated:
Samples of seawater from Buyat Bay exceed the quality limits set out in Environment Minister Regulation no. 51 2004 regarding Seawater Quality for Marine Biota. Sampling by the Police Forensic Laboratory also indicated sludge from the accused's sediment pond has reduced the water quality of Buyat River

• Sampling by the Police Forensic Laboratory found Buyat Residents and Buyat Bay marine biota contaminated with metals Mercury (Hg) and Arsenic (As);
And that the environmental condition meant the Buyat area was no longer an adequate place to reside, so that Buyat Pante village residents were relocated in late 2004.

The specific Laws and Regulations relied upon in the indictment:

• Failing to undertake management of the wastes of its business or activities as required in order to avoid environmental damage or pollution as set out in clause 21(1) of the Industrial Law no.5 1994.

• Breaching water quality limits set by the 1995 Environmental Ministerial Regulations (Kep-51/menlh/10/1995) attachment C

• Contravening Environment Law no.23 (1997):
o clause 14 (1) which states:
"To ensure the protection of environmental functions, all businesses or activities are prohibited to breach quality standards and environmental impact standards";
o and clause 16 (1) which states:
"persons responsible for businesses or activities are required to undertake management of the waste of that business or activity"
o The acts (pollution and environmental damage) of the accused are classed as a crime according to clauses 41(1), 45, 46(1) and 47.

• Contravening Government Regulation Controlling Pollution or Damage to the Sea (no. 19 of 1999), clause 18.

• Breaching water quality standards set out in the 2000 Environmental Protection Agency Regulations (b1456/bapedal/07/2000)

• Police Forensic testing showed Buyat Bay waters exceeded standards in Environment Minister Regulation no. 51 2004 regarding Seawater Quality for Marine Biota.