MAC/20: Mines and Communities

Freeport, Rio breaching environmental laws: Indonesian watchdog

Published by MAC on 2006-05-04

Freeport, Rio breaching environmental laws: Indonesian watchdog

Jesse Riseborough

PNG Industry News

4th May 2006

INDONESIAN environmental watchdog, Wahli, in a new report has accused owners of the Grasberg mine in the province of Papua, US-based Freeport McMoran and Rio Tinto, of knowingly breaching environmental regulations and causing more extensive toxic contamination of local water supplies due to acid rock drainage than first thought.

The 119-page report claims to have accessed internal Freeport and Rio Tinto environmental risk assessment documents as well as Indonesian Government reports not previously made available to the public.

Wahli, a member of the global Friends of the Earth organisation, claims the most serious
breach by Freeport and Rio Tinto, which hold a 40% stake in the mine, is the failure to comply with previous demands, some more than five years old, that the Indonesian Government made with regards to waste management practices.

"A key finding of this report is that Freeport-Rio Tinto has failed to comply with government orders to amend its dangerous waste management practices despite years of official findings that the company is in breach of environmental regulations."

Wahli said the largest copper-gold mine in the world has been allowed to operate "under a shroud of secrecy" and also claimed both Freeport and Rio Tinto have been able to exert a certain degree of political and financial influence over the Indonesian Government, enabling them to work around environmental regulations.

"The law is not enforced by the Ministry of Environment due to the joint venture's pervasive financial and political influence, to the degree that a Freeport-Rio Tinto proposal for circumventing water quality standards seems to be under consideration."

The mine's owners were reportedly asked to make a number of changes to waste disposal at Grasberg, including a request in 2001 and again in 2006 for the construction of a tailings pipeline to the lowlands and a tailings containment dam.

Wahli claims the Indonesian Government alerted the two companies, in both 2004 and 2006, the mine was polluting the river system and estuarine environment in breach of regulatory water quality standards.

The Indonesian Government also reportedly made the companies aware, earlier this year, that the mine was discharging acid rock drainage without a hazardous waste licence, at levels breaching industrial effluent standards, whilst failing to establish mandated monitoring points.

"Over 3 billion tonnes of tailings and up to 3 or 4 billion tonnes of waste rock will be generated throughout the life of Freeport's operations until closure around the year 2040," the watchdog said.

"In total, Freeport-Rio Tinto wastes 53,000 tonnes of copper annually, released as Acid Rock Drainage (ARD) leachate and tailings into the river. This rate of heavy metal pollution is more than a million times worse than achievable with standard mining industry pollution prevention practices.

"The wasted copper costs the Papuan provincial government substantial income from lost royalties and creates serious environmental damage in groundwater and in the rivers and estuary downstream."

The report claims more than 1 billion tonnes of tailings from the Grasberg mine has been
deposited into the Aghawagon-Otomona-Ajkwa river system since the mine began operating, "despite riverine disposal of mine tailings being expressly prohibited under the Indonesian Water Quality Management and Water Pollution Control Regulations 2001".

Wahli claims fish caught in the Ajkwa Estuary have levels of contaminated copper in their bodies 100 times higher than normal at up to 1 gram per kilogram.

Wahli called on the Indonesian Government to immediately enforce a closure of the Grasberg mine until all breaches of the country's environmental regulations are rectified and also to prosecute both Freeport and Rio Tinto for the alleged breaches.

Indigenous Papuans have staged a number of violent protests and demonstrations over the past few months at the mine site, in the provincial capital of Jayapura and in Jakarta. Papuans have long claimed economic benefits from the mine's profitability had not flowed through to the local community.

Last year, Freeport posted a full year net profit of $US934.6 million ($A1.22 billion).

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