Habibie's support for Freeport's expansion roasted
JAKARTA (JP): Mining professionals and environmentalists have panned President B.J. Habibie's support for PT Freeport Indonesia to increase daily ore output at its Grasberg mine in Irian Jaya.
The chairman of the Indonesian Mining Professionals, Herman Afif Kusumo, lambasted the copper and gold producer for using a power approach to lobby the President to pressure Minister of Mines and Energy Kuntoro Mangkusubroto into accepting its controversial expansion plan.
"I very much support Kuntoro for his stance regarding Freeport's expansion plan. I hope Kuntoro will be consistent and strong enough to resist Freeport's pressure," Herman told The Jakarta Post on Thursday.
Freeport is seeking to raise output to 300,000 metric tons.
Herman also criticized Habibie for not involving the people of Irian Jaya in evaluating Freeport's expansion plan.
"The country is going to introduce a regulation on regency autonomy in the near future. So, why not allow the Irian Jaya administration to decide or take part in deciding the issue?"
Meanwhile, executive director of the Indonesian Forum for Environment Emmy Hafild said on Wednesday Habibie's endorsement showed he was more concerned with economic matters than the environment.
"This further strengthens our perception that the present government is not reform-minded, but simply a transitional administration. They are wearing the reform clothes, but the officials and their way of thinking are the same as that of the previous regime."
Economist Rizal Ramli deplored Habibie's failure to use his support for expansion as leverage for better contract terms.
"If Habibie really represents the nation's interests, he should bargain ... but he didn't do so. Thus, you can question whether Habibie really represents Indonesian interests."
Habibie has ordered several Cabinet members, including Kuntoro, to assist Freeport realize its expansion according to the schedule and plan agreed upon by the government, despite Kuntoro's demand for further assessment of the plan.
The President gave the instruction in response to the request from James "Jim Bob" Moffet, CEO of Freeport's holding company Freeport McMoRan Copper & Gold of the U.S.
Moffet claimed the company had all the permits necessary for the expansion.
Director general of mining Rozik B. Soetjipto earlier said the company had obtained the required environmental impact analysis certificate from the state minister of environment in December 1997, and a principal permit from his office, allowing Freeport to conduct a feasibility study and trial operation until March this year.
Kuntoro said he was reluctant to grant a definite permit for the expansion plan because he wanted to ensure Freeport's operation in Irian Jaya would help modernize the local economy.
He also doubted Freeport's technical ability to protect the environment with its expansion.
After meeting with Habibie on Monday, Kuntoro said he would license Freeport's expansion plan provided the company had the technical ability to protect the environment.
Hafild doubted Freeport's ability to protect the environment around its mining area, citing damage to the Wanagon tailing dam last year.
"The construction of the tailing dam was weak. What will happen if Freeport increased its output?" Hafild said.
Freeport is licensed to produce 160,000 tons of ore per day, but it has increased its ore output to about 200,000 tons per day as part of the trial expansion.
President of the Indonesian Mining Association Benny Wahyu said Freeport's aggressive move to obtain a license for its expansion plan was understandable because mining companies had to increase output to survive amid collapsing prices of mining products. (jsk/das)