Hostilities toward oil, mining firms growing: Minister

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)