Newmont denies Indonesia mine is polluting
Date: 11-Nov-04
Country: USA
Author: Steve James
Denver-based Newmont responded to a study from Jakarta showing sediment in Buyat Bay contained significant levels of arsenic and mercury. However, the study by a government-commissioned panel also found water quality met Indonesian standards, according to the New York Times, which obtained a copy of the report before its expected publication yesterday.
The Times said the report, written by technical specialists, found fish in the Sulawesi island bay near Newmont's Minahasa Raya mine, were contaminated with enough arsenic to make them dangerous for human consumption. The report recommended the Health Ministry carry out more tests on villagers who have complained of rashes, lumps, breathing difficulties and dizziness.
It also said the ministry should consider moving villagers from an area "possessing high risks for human health." Some villagers have filed a $543 million lawsuit against Newmont, charging that tailings, or waste, from the mine have caused serious illnesses and ruined the local fishing industry.
"Elevated levels of arsenic were expected in the tailings solids and were regularly measured and reported," Dave Baker, Newmont's vice president for environmental management said.
"The tailings system was designed so that the arsenic would be in a safe chemically stable form that is locked into the sediment and not released into the environment."
He said all scientific studies and Newmont's data show fish tissue contain normal levels of arsenic compared to applicable standards and fish from elsewhere in the world. "This adds further confirmation that arsenic from the tailings is not being released from the sediment or assimilated into the food chain," said Baker in a statement.
Last week, Newmont confirmed its commitment to mining in mineral-rich Indonesia despite allegations of pollution. In October it said it was vindicated by two other reports - one by the Indonesian government and one by the World Health Organization - showing that Buyat Bay was not polluted.
Newmont's stock rose 45 cents, or less than 1 percent, to $49.43 on the New York Stock Exchange. Wall Street analysts were skeptical the new report would have much impact.
Victor Flores, senior mining analyst with HSBC Securities, said removing mercury and arsenic from mine waste was standard. "To think that an 'evil corporation' would try to cut costs in disregard for the Indonesian public is ridiculous.
"To say they just dumped it shows an ignorance of the whole mining process."
He said local people in Brazil, Indonesia or Africa amalgamate ore with mercury to separate out the gold. "It's no wonder there's mercury poisoning, all the locals are doing it.
Victor Lazarovici, a mining analyst with BMO Nesbitt Burns, does not follow Newmont, but spoke in general terms about corporate attitude toward environmental issues.
"I am not sympathetic to claims that companies go out of their way to destroy the environment. It (damage) comes with the territory and it is unreasonable to believe the world can survive without mining," he said.
From an investor's perspective, "this may have an impact on the value of a company," said Lazarovici. "Operations were shut down in the '80s in the U.S. because they could not be upgraded to environmental standards and the price was prohibitive."
