Newmont case 'another blow to mining'

Newmont case 'another blow to mining'

The Jakarta Post, Jakarta

Controversy over Newmont's operations, sparked by allegations
from non-governmental organizations that the firm polluted waters
in North Sulawesi, has dealt another blow to the nation's mining
industry and hurt investment in the sector, an official and
expert said on Sunday.

"The case has sent another negative signal to foreign
investors in the country's mining industry, which has long been
troubled by countless problems and uncertainty," said Simon
Sembiring, the Director General of Geology and Mineral Resources
of the ministry of mining, at a media conference on Sunday.

Simon said that mining businesses not only provided
significant revenue for the government, but also had a trickle-
down effect in remote areas, such as in creating jobs for locals
and improving their living standards.

Simon was commenting on a recent allegation that the
operations of PT Newmont Minahasa Raya, the local unit of U.S.-
based gold mining giant Newmont Mining Corporation, had polluted
waters in Buyat Bay, Minahasa regency, South Sulawesi, which led
to the spread of a disease resembling one that once affected
people in Minamata, Japan.

Minamata disease was caused by mercury disposed of by local
industrial firms.

However, according to Health Minister Achmad Sujudi, the
preliminary examination of four residents from Minahasa, who were
thought to have fallen ill due to pollution in Buyat Bay, had not
found any indication of Minamata disease.

Newmont is among the eight companies that received a "green
award" from the government this year. The firm was given the
award for its operations in West Nusa Tenggara.

The Newmont case is the latest in a series of problems
besetting the industry that have caused a significant drop in
investment in the sector.

Recently, the government and the House of Representatives
agreed to amend the forestry law to allow 13 mining companies to
resume their open-pit mining operations in protected forests. The
companies had secured contracts prior to the issuance of Forestry
Law No: 44/1999, which bans open-pit mining in protected forests.

According to data from the Ministry of Energy and Mineral
Resources, total investment in the mining sector -- which reached
US$1.15 billion in 1999 -- continued to drop in the following
years to $422.30 million in 2000, $319.73 million in 2001,
$298.12 million in 2002 and $63.93 million in 2003.

Meanwhile, PL Coutrier, an executive of the Indonesian Mining
Association (IMA) said the association regretted baseless reports
that discredited the mining industry.

"Given its highly significant contribution to the regions, it
is understandable that we cannot afford this sector to weaken,"
said Coutrier.

Elsewhere, PT Newmont Nusa Tenggara, a local unit of Newmont
in Sumbawa island, West Nusa Tenggara, said it had filed a
criminal complaint against various individuals in the area for
defamation following an allegation that its operations on the
island had caused another outbreak of Minamata disease.

Editorial - Page 6

Eyebox

Newmont environment policy

-- Newmont requires all of its operations to comply with local
laws and regulations that apply to its activities.
-- For the design and construction of new facilities, and the
modification or expansion of existing facilities, Newmont adheres
to the host country's laws and regulations. However, in some
countries, particularly developing countries, minimum design
criteria and standards for mining and milling operations either
do not exist or require a standard lesser than that which Newmont
has set as a minimum for the company. In such cases, Newmont's
own (higher) standards are applied, often based on the Nevada
Administrative Code governing the design, construction and
operation of mining facilities.
-- Similarly, when discharges to surface or ground waters are
unavoidable, Newmont is required to comply with the host
country's laws and regulations. If country laws are nonexistent,
inadequate or incomplete, the U.S. primary drinking water
standards will be deemed the appropriate standards for the
protection of human health.

Source: www.newmont.com