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Newmont case a test of Indonesia's environmental law

A star government witness in a criminal trial against the US mining giant Newmont told a court on Friday that waste from the company's mine near here was deposited in the sea at too shallow a depth, causing the contamination of fish.

The witness, Masnellyarti Hilman, a deputy environment minister, said elevated levels of arsenic in the fish and the "reduced biodiversity" in the bay near the gold mine demonstrated pollution.

The company vigorously denies the Indonesian government's accusations of pollution and contends that the waste from the mine, near Buyat Bay on the island of Sulawesi, was safely disposed of through a pipe that ran about 800m from the shore into the equatorial waters.

As soon as Hilman mentioned pollution, the lead lawyer for the corporation, Palmer Situmorang, protested to the judge, who ruled that the word should not be used until there was a verdict.

The president of Newmont in Indonesia, Richard Ness, who has been charged along with the company, said he rejected Hilman's argument on the impact of the mine waste.

The trial, a rare case of a major US corporation facing criminal charges in a developing country, pits one of Indonesia's valued foreign investors against the nation's little-tested environmental laws. The government took action in 2004 after villagers near the mine complained of tumors, skin rashes and dizziness, for which they blamed the company.

Newmont, a Denver-based firm and the world's biggest gold producer, has said the illnesses are common to poor coastal communities, and denies responsibility. Most of the villagers, citing fears for their health, moved to another area in Sulawesi last June.

The deputy minister did not make any connection between the contaminated fish and the people's health. She said only that the villagers ate the fish. Experts have said it would be virtually impossible to prove that the mine caused the illnesses.

The chief environmental issue in the trial involves the disposal of the waste, known as tailings, by a method called submarine tailing disposal, which is essentially banned in the US.

Hilman testified that Newmont's 1993 operational license for the mine called for the company to place the waste below the thermocline, a layer below which water is colder and has less oxygen.

In 1999, she said, a study by the Environment Ministry and the University of Sam Ratulangi in Manado found that the thermocline was at a depth of 110m. But the company, she said, released the waste from the pipe at a depth of 82m, where the waters were still warm. At that depth the heavy metals in the tailings -- arsenic, for one -- were able to enter the food chain, she said.

Newmont has consistently argued that the arsenic remained inert and insoluble in the ocean.

Another issue in the trial is the government's accusation that the company did not have the proper permit to dispose of its waste.

Hilman, who has a degree from a prominent mining school in the US, the Colorado School of Mines, and is known among the foreign mining firms in Indonesia for being a stickler on pollution, argued that the company had failed to obtain the right permits for toxic waste.

"You can dump waste if you follow the standards and have the permit," Hilman said.
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