MAC: Mines and Communities

A cold reception

Published by MAC on 2001-05-01

A cold reception

A Down to Earth representative went briefly to the company reception, after the AGM, in order to fulfil a promise made to Pak Pius Nyompe of LKMTL, the community organisation at the Kelian gold mine, East Kalimantan (PT KEM). This was that the British group would give Rio Tinto's Chairman a letter from LKMTL explaining why it had withdrawn from PT KEM's mine closure committee and working groups. The DTE representaive asked Robert Wilson who would be taking responsibility for the mine closure and ongoing social and environmental issues now that he was leaving (and his replacement would not have the same status). Also, since Rio Tinto had reorganised its group operatins, there was no longer a specific Gold Division. Wilson claimed that LKMTL had only withdrawn from one meeting and that the Indonesian Commission for Human Rights had set up a mechanism to address any outstanding issues (Both these claims according to DTE are not true).

Ed Matthew of Friends of the Earth (England, Wales and Northern Ireland) then presented Wilson with a highly critical report on Rio Tinto’s operations in Indonesia, carried out by WALHI (Friends of the Earth, Indoensia). Wilson politely thanked him and said he would contact FoE for discussions after he'd read it . He also commented that he regretted that FoE's website contained information which was out of date and/or wrong. For instance, NGOs were completely wrong "to keep going on about Poboya, as Rio Tinto had no involvement there since 1999". DTE corrected him, pointing out that technically Rio Tinto still owned the concession and therefore was indeed responsible. Wilson snapped back: "What another company does with the land is none of Rio Tinto's business". DTE replied that, signing a 'farm in’ agreement with Newcrest - or any other company - did not absolve Rio Tinto of responsibility. Wilson's parting shot was to the effect that|: "Well, if you can't accept that, there's nothing to discuss".

The following are the questions on KELIAN which DTE were unable to ask before shareholders at the 2003 Tio Tinto AGM:

The Kelian gold mine in East Kalimantan, Indonesia is 90% owned by Rio Tinto, through PT KEM. In this year's Annual Review (p26), it is stated that Rio Tinto's net earnings from this mine in 2002 were US$17 million - a substantial increase on 2001 due to an increase in production to 485,000oz/yr.

The Kelian mine has a long history of social and environmental problems, including documented cases of human rights abuses, violence against women and pollution from cyanide and acid rock drainage. It is due to close next year.

Sir Robert Wilson has told Rio Tinto shareholders in previous years with pride about the Kelian mine closure programme initiated through the World Bank's Business Partners for Development. This was intended to bring together the company, local government, academics and community representatives. Rio Tinto wants to promote Kelian's closure as a model of good practice.

Far from rehabilitating the concession area, KEM will not fill in the main pit or waste dumps then reforest the whole area. It will flood them to create artificial lakes and an artificial swamp. Sludge containing cyanides, heavy metal and other toxics will remain untreated. These could contaminate water supplies and enter the food chain. · The euphemistically named 'wet cover' and 'wetlands' methods are still experimental. Their long-term safety has not been proven scientifically. · Ground and surface water from these areas eventually drains into local rivers used by thousands of local people. · Dams can fail or flood, again releasing polluted water into local rivers. · The existing acid rock drainage problem will not be solved solely by covering other waste heaps with soil.

The community organisation LKMTL has repeatedly asked Rio Tinto and KEM - both through the Mine Closure Steering Committee and direct to senior management - to take responsibility for the long-term environmental security and protection of the community's health and livelihoods. They have asked for guarantees, independent environmental monitoring and free hospital facilities.

LKMTL withdrew from KEM's Mine Closure Committee and Working Groups on March 19th, because the committee was only a token gesture and did not take community concerns and solutions seriously (English translation of letter available from DTE).

Rio Tinto's new 'Way We Work' booklet says (p7): "We recognise that excellence in managing Rio Tinto's health, safety & environment and community responsibilities is essential. We also show that good working relations are fundamental to success".

1. How is Rio Tinto genuinely going to meet the Kelian community's needs after mine closure?
2. How does Rio Tinto intend to deal with the outstanding human rights, social and environmental problems extant before mine closure?
3. How will the Kelian experience influence Rio Tinto's other mine closure plans?

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