Further information on the landslide at Freeport's Grasberg Mine

While Freeport-Rio Tinto continues to claim the October 9th disaster at Grasberg was a "natural event", evidence accumulates that the company ignored the dangers implicit in its voracious mining practices and failed to take even minimal steps to avert them.

Landslide at Grasberg

Tempo

November 04 - 10, 2003

THAT morning Frederik Tokan was at the wheel of his truck. Together with other members of Operation Crew IV, he was hauling tons of gold-bearing rocks to the processing plants. Frederik was experienced in the job he was doing that fatal morning for his employer PT Freeport Indonesia.

Everything was running normally. It was 5:10am when the disaster struck. From high above an avalanche of rocks, earth and mud rolled downhill sweeping away everything in its path. In an instant, Frederik and 13 other members of his work crew were buried under 2.3 million cubic meters of rocks.

Last week rescue workers found Frederick's truck, but his body and those of four other members of Operation Crew IV were yet to be recovered. The oversized truck, running on tires 3 meters high, was found 1 meter beneath the debris.

The landslide, which occurred on Thursday in the second week of October, was located at a geologic convergence formation in a weak zone at an altitude of between 3,800 and 4,000 feet above sea level. Sidharta Moersyid, Senior Manager Corporate Communications, says the disaster struck in an area south of an open-pit mine in Grasberg in the Papuan district of Mimika. Nurhidayati, of the Indonesian Forum for the Environment (Walhi), blamed the disaster on Freeport's lack of concern for the environment. She says Freeport knew Grasberg is an area prone to landslides because of the topography and the high rate of rainfall there.

Nurhidayati charged the company with operating beyond the carrying capacity of the environment. She says Freeport daily extracted a total of 240,000 tons of ore. Several years ago, a landslide occurred in Danau Wanagon when production was even lower. Sidharta took the charge lightly, saying investigation was still in progress. "The cause of the landslide has not been determined yet," he said. Insp. Gen. Budi Utomo, chief of the Papua Police, blamed heavy rains and storms for the landslide.

Sidharta denied Nurhayati's charge that his company had operated beyond the carrying capacity of the environment. He says Freeport was producing below the level of 300,000 tons per day permissible under the mining license. At all times, he added, Freeport considers environmental aspects in its operation.

Immediately after the landslide the Department of Mines & Energy dispatched a mining inspection team to the accident site. Members of the team included two geo-technical experts from Bandung Institute of Technology. Wimpy S. Tjetjep, Director-General of Geology and Mineral Resources, says the team's findings established that the landslide was caused solely by natural factors and that there was no evidence of a breach of procedure or damage to the environment.

According to Wimpy, weathered soil and rocks contributed to bringing water content in the ground to saturation point and thereby increasing soil weight which led to the landslide.

Freeport, says Wimpy, had taken anticipatory measures, including against the possibility of a landslide by preparing a location to receive materials from such an event. A technical team set up by Freeport calculated that the landslide materials would collect at mining zone P-6. Thus, a day before the landslide, all mining activities in the area had already been suspended. The team believed any landslide that might occur would not go beyond the P-6 zone. Mining activities at nearby P-5 zone continued as usual. But the team miscalculated. The landslide rolled on to P-5 where Operation Crew IV was at work on the day of the accident. The team was also proved wrong in predicting normal rainfall. Two days before the landslide, abnormally high rainfall drenched the site. "This is what we call a natural disaster," says Wimpy.

Wimpy didn't deny the possibility of mining activities at an altitude of 4,000 feet above sea level bringing on a landslide. What's more, says Wimpy, many cracks were evident in parts of the Grasberg formation. But that didn't mean that no mining could be done in such an area. He says there is no limit as to altitude where open-pit mining should stop. Masnellyati Hilman, Deputy in Charge of Environmental Management Facilities at the Department of the Environment, says mining in an area with a steep incline and high rainfall-as in Grasberg-should normally be done by terracing.

The procedures are, said a TEMPO source in Timika, that in any excavation in such an area, terraces 15 meters high and 15 meters wide should be built to reduce steepness and hold back rock materials from collapsing. But, added the source who requested anonymity for fear of being discharged, Freeport neglected to build such terraces. Any that were built measured only 1 meter wide, said the source.

Asked for confirmation, Sidharta only said: "We have done everything and followed all the mining procedures." According to the TEMPO source, the area where the landslide occurred was known to be a gold-bearing formation and was therefore mined to the limit. Dynamite was used to speed up the work. As a result, said the source, the earth shook, triggering the landslide.

"The landslide was not caused by nature, but by man's neglect," the source claimed. Sidharta denied the charge, saying: "If they say the landslide was caused by the use of dynamite, I say that is not true."

Suyartono, Technical Director for Minerals and Coal at the Department of Mines & Energy said the government wanted Freeport operation to return to normal. Each year, he said, Freeport pays US$178 million in revenues to the government, including US$145 million in taxes and US$33 million in non-tax payments. Suyartono added that the company also accounts for 97.4 percent of gross regional domestic product in Timika. Up to one-quarter of 17,000 people employed by Freeport are native Papuans.

But these figures, says Andreas Anggaibak, a native Papuan of the Amungme tribe, have been obtained at the expense of a falling quality of the environment. Thousands of hectares of land have been contaminated by Freeport tailings, he says. Not to mention the large number of flora and fauna killed in the process. Rivers which used to flow with clear water are now turbid like condensed milk. "People who used to live off products from the rivers and forests now can no longer do so," says Andreas.

Reforestation programs carried out by Freeport are not equal to the damage done to the environment. "Freeport planted casuarina trees where sago palm trees were before. We Papuans eat sago, not casuarina," says Andreas.

The man who pioneered the huge - and disastrous - expansion at the Freeport-Rio Tinto Grasberg mine has just become president of Ivanhoe Mines (chairman Robert Friedland), with a mandate to introduce similar methods to the company's major copper-gold project in Mongolia

Ivanhoe brings former Grasberg manager on board

Miningnews

November 06, 2003

Ivanhoe Mines has appointed former Freeport McMoran Copper & Gold executive John Macken as company president with a mandate to bring its Mongolian copper-gold discoveries into production.

Macken, 52, spent 19 years with Freeport, most recently based in New Orleans as senior vice-president strategic planning and development.

He also spent 13 years with Freeport.s Indonesian operating unit, ending up as executive vice-president and general manager at its massive Grasberg operation in Papua, the world's largest single copper-gold mine.

Ivanhoe chairman Robert Friedland, who has been acting as company president since February, said Macken's appointment was another indication of Ivanhoe's determination to be the builder of Turquoise Hill, and to play an active lead role in directing development of the project.

Macken headed a US$1 billion expansion of the Grasberg openpit and underground mining complex in a joint venture with Freeport and its largest shareholder, Rio Tinto.

"In Indonesia, John developed a strategy that optimised material movement that allowed ore production just in the openpit to attain levels of more than 200,000t per day and brought into production a new 25,000t per day underground block cave mine that today is operating at up to 50% above its installed capacity," Friedland said.

"He also directed the construction of a coal-fired power plant, a 120km transmission line, a 90,000tpd concentrator and other mine infrastructure.

"In Mongolia, Ivanhoe plans to use openpit and block cave mining methods, we also are evaluating an option to use coal-based electricity and we also expect to have an initial design throughput well in excess of 100,000tpd."