Thu, 09 Nov 2000

Hostilities toward oil, mining firms growing: Minister

JAKARTA (JP): Minister of Energy and Mineral Resources Purnomo Yusgiantoro called on local oil and mining companies on Wednesday to improve community development in a bid to curb the escalation of hostilities against their operations.

Purnomo said that in addition to the improvement of law enforcement, promoting good relations with surrounding communities was needed to prevent further acts of hostility.

"We are cooperating with the police to prevent the problem from getting worse," Purnomo said during a break in a hearing with the House of Representative's Commission VIII for environmental, science and technological affairs here.

The minister acknowledged that acts of hostilities against oil and mining companies were escalating and could cripple the country's mining sector.

"If it (the outbursts of hostility) keeps escalating, these small incidents could accumulate to cause even bigger problems, which is what we have to look out for and prevent," he said referring to the recent burning of PT Caltex Pasific Indonesia's oil wells in Duri, Riau.

Protesting farmers burned the area around the oil and gas company's five oil wells located at Caltex's Duri oil field in the Bengkalis regency late on Monday, not in Rokan Hilir as reported in The Jakarta Post Wednesday.

The farmers were disappointed by Caltex's unwillingness to pay higher compensation for the land acquired by the company during the Soeharto era.

Purnomo said the five wells were not actually set on fire, but that the areas surrounding the wells were stacked with wood and burned.

The burnings had caused three of the wells to be temporarily shut down on Tuesday, with one well needing minor repairs due to the heat from the fires, an official at Pertamina's managing and development body of production sharing partners (BPPKA) said.

"We've now repaired the damages and all five wells are now fully operational," he told the Post.

Such acts of violence were not the first to have been directed at Caltex. As the country's largest oil producer, Caltex has recurrently been the subject of public discontent.

In a normal day, the affiliate of U.S. oil companies Chevron Corp. and Texaco Inc. produces 700,000 barrels per day (bpd) or about 80 percent of the country's total crude oil production.

Only last month the oil giant had to deal with blockades of its water treatment plant and its drilling rigs from villagers demanding jobs from the company and its contractors.

Recently villagers also blockaded East Kalimantan-based oil company PT Unocal Indonesia, demanding compensation for alleged pollution to the villagers' farmland.

Several other mining companies such as gold producer PT Newmont Minahasa Raya in North Sulawesi, coal producer PT Kaltim Prima Coal (KPC) have become the subjects of resentment from local communities.

Newmont was forced to close down its mining sites after a group of angry villagers demanding higher compensation payment for their land took over the company's mining equipment.

KPC had also been compelled to shut down its mining operations when striking workers demanding higher pay took control of its production facilities.

Other mining giants such as Freeport Indonesia have also been the target of criticism from environmental activists for allegedly causing environmental damage. (tnt)