KEM's gold output plunges due to blockade<\/p>\n
JAKARTA (JP): Australian based mining company Rio Tinto
\nIndonesia said on Monday that gold production of its subsidiary
\nPT Kelian Equatorial Mining (KEM) had dropped by about 400,000
\nper troy ounce since locals blocked the road to its mine in East
\nKalimantan.<\/p>\n
Rio Tinto president Noke Kiroyan said that production had
\ndropped as the road blockade shut out diesel oil fuel and camphor
\nsupplies, which were essential during production.<\/p>\n
\"Until now we are still unable to operate the mine,\" Noke told
\nreporters in a joint news conference with the Indonesian Forum
\nfor Environment (Wahli).<\/p>\n
Given fluctuating gold prices, Noke declined to say how much
\nthe production loss had cost the company. He added that the
\ncurrent gold price stood at some US$270 per troy ounce.<\/p>\n
The company, 90 percent of which belongs to Rio Tinto and 10
\npercent to local partner PT Harita Jayaraya, has an average
\nproduction output of between 13 tons to 14 tons per year.<\/p>\n
Locals have occupied the road since April 18, to pressure the
\ncompany into negotiation over land compensation payments.<\/p>\n
KEM continued to operate for 10 days until a shortage of
\nsupply led to the mine's closure.<\/p>\n
However, Noke said, the present road blockade was less tight
\nthan last month, as locals allowed some of the supply material to
\npass the blockade.<\/p>\n
\"Although it's not enough for us to restart production,\" he
\nadded.<\/p>\n
Noke expressed confidence that the mine would soon start
\noperating again.<\/p>\n
\"I hope that within a few days locals would lift the
\nblockade,\" he said.<\/p>\n
He said his optimism was based on locals' growing confidence
\nthat a solution to the land dispute was in sight.<\/p>\n
Noke said that locals and KEM agreed last week to resume
\nnegotiations over the land compensation payments.<\/p>\n
\"We want to resolve this dispute in a manner that we could be
\nproud of,\" he said.<\/p>\n
According to him, talks had come to a halt last year due to
\nchanges in KEM's management and the split of the Kutai regency --
\nwhere KEM was operating -- into three regencies.<\/p>\n
\"This stirred frustration among the locals that in the end has
\nled to this blockade,\" he explained.<\/p>\n
He said KEM was now operating in the West Kutai regency, which
\npreviously had no district head nor an office to govern the
\nregency.<\/p>\n
The local government had been a facilitator to negotiations
\nbetween both parties.<\/p>\n
The local government formed a verification team in 1998 to
\nvalidate some 6,000 claims made by locals on the land that KEM's
\noperation currently occupied.<\/p>\n
KEM said it had already paid Rp 10 million ($1,200) in 1990 to
\neach of the 444 land owners, as an incentive for leaving the land
\nwhich KEM would occupy.<\/p>\n
Noke said that the team had now completed its assessment.<\/p>\n
\"It validated that not all of the claims are true,\" Noke said.<\/p>\n
According to the company, the area which locals have claimed
\nexceeded KEM's total mining area of 1,285 hectares, some of which
\nbelonged to the government and the public.<\/p>\n
However, Noke declined to name the amount of compensation that
\nKEM offered to locals, saying that it might affect the present
\nnegotiation process.<\/p>\n
Walhi chairwoman Emmy Hafild expressed her pessimism over a
\nquick solution to the dispute, saying that negotiations thus far
\nhad already been too tedious.<\/p>\n
Previous talks, she said, only concerned the parties that were
\nallowed to represent the locals during the negotiations.<\/p>\n
She conceded that land compensation payment was therefore a
\ndifficult issue to reach an agreement on.(bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/kems-gold-output-plunges-due-to-blockade-1447893297",
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