Background Information

Indictment of PT Newmont Minahasa Raya and Rick Ness, President Director, PTNMR

Context: Newmont started operations at Minahasa Raya in 1996 and operated the mine through August 31, 2004, when the mine was closed. During closure of the mine, Newmont faced a year of sensational accusations, only to see the subsequent retractions of those accusations and exoneration by more than a dozen independent scientific studies on the allegations of pollution in Buyat Bay.

For ten years, Newmont has engaged in community development programs in approximately 15 local communities surrounding the mine, including infrastructure, such as schools, clinics, public washing and toilet facilities, as well as power and water lines. In addition, the company managed vocational training, small business development, agricultural and fisheries programs to help ensure that the economy which grew around the mine was able to sustain itself after the closing. The company continues to conduct a number of health programs in the communities which includes funding of clinics, medicines and health training for villagers.

In August 2005, Newmont was granted its second "Green" award from the Indonesian Ministry of the Environment (yes, the same ministry that is suing Newmont for environmental violations) for its success in preserving the environment at its other Indonesian mine: Newmont Nusa Tenggara's mine in Sumbawa, which began operating in 2000. This award recognizes companies that successfully implement environmental programs in Indonesia. Newmont has invested $2 billion dollars in its Indonesian operations.

SUMMARY:

Overwhelming scientific evidence, including from the government's Ministries of Health and Environment, shows there is no harm to the people from mining operations, and that Newmont has properly managed the environment of Buyat Bay.

The fish are safe to eat, and the seawater is within all Indonesian and international safety standards.

There is no pollution, thus PTNMR has committed no crime.

Trial Fact Sheet

Indictment: PTNMR and its President Director Rick Ness, a U.S. citizen, are charged with breaching Articles 41-44 of Law No. 23 of 1997 Management of the Environment. These articles, in general, make it a crime to intentionally or negligently engage in acts resulting in environmental pollution which is defined as impairing the ability of the environment to perform designated functions.

Specifics: The indictment states that 'acts' resulted in environmental pollution because 1) seawater in Buyat Bay is contaminated with arsenic and mercury; 2) marine biota in Buyat Bay is contaminated with arsenic and mercury; and 3) local residents are contaminated with arsenic and mercury and suffer from itchiness.

Trial: Began August 5, 2005. Newmont presented its “exceptions” (the lack of legal basis for the case, rather than the scientific merits) and two weeks later the prosecution responded. The court ruled against Newmont, saying the case would proceed against the company and against Rick Ness. The government began presenting its case at trial on October 7th. Trial is scheduled to occur one day each week (Friday), and is expected to last at least six months.

Timeline

• August 1995 – Six months before the mine opened, a report in the local paper, the Manado Post, quoted fishermen as saying tailings had caused a great reduction in fish catches and quoted NGOs as condemning pollution caused by tailings. Remarkably, this was six months before the mine opened and before any tailings had been placed in the sea.

• March 1996 – Newmont began mining operations, having completed construction of the $234 million Minahasa gold mine. During its peak, the mine employed 700 workers.

• 1996-2004 – Allegations from NGOs alleging disease from Newmont’s operations continued. Each allegation was investigated by appropriate authorities and found to be baseless.

• 2004 – Local NGOs published booklet entitled, “From Minahasa to Minamata,” accusing Newmont of causing Minamata (mercury poisoning) disease (later debunked by Minamata Institute of Japan).

• 2004 – Villagers were paid to travel to Berkeley, CA, for NGO-sponsored training on anti-mining activities.

• July 3, 2004 – A baby in Buyat Pantai died. Local doctor said the cause of death was malnutrition. Fueled by NGOs, mother blamed Newmont and said baby Andini was poisoned by heavy metals. Story exploded into local and national media..

• July 20, 2004 – Dr. Jane Pangemanan and four Buyat Pantai villagers filed a police complaint against PTNMR accusing the company of negligence and causing death. Police launched investigation, declaring Newmont employees “suspects,” took water samples with assistance from Newmont (Newmont, simultaneously, took duplicate samples).

• July 26, 2004 – Three villagers filed a civil claim that they had developed health problems from mine waste. They asked for $543 million in damages.

• July 2004 – A local NGO accused Newmont of causing over a hundred local residents to suffer from Minamata disease, which is caused by mercury contamination.

• July 2004 – Following the initial accusations and a public campaign against the company, the Indonesian Ministry of Health said there was no Minamata disease, based on on-site testing and assessment by the Minamata Institute of Japan. The Indonesian State Minister of Environment said the water and fish in Buyat Bay were not contaminated with either mercury or arsenic.

• August 2004 – The Indonesian National Police announced their water tests, conducted by their own laboratory, showed Buyat Bay had been polluted with high levels of mercury and arsenic. Newmont had an independent laboratory test duplicate samples (simultaneously collected). The lab’s results disagreed with police lab results and found all levels of heavy metals within all international clean water standards. Indonesian Police never explained why their tests results were the only tests to find levels vastly different from all other scientific studies to date.

• September 8, 2004 – The New York Times published a front page story implicating Newmont in death of baby Andini and in an alleged decline in fish stocks. Story leapt onto international scene. NYT ombudsman would later criticize this story in his report.

• September 2004 – PTNMR, Rick Ness, and five other Newmont employees were arrested and detained by police. Five of the six were put in jail for 32 days and were never questioned. Due to health reasons, Newmont’s President Director, Rick Ness, was not incarcerated but was prohibited from leaving Indonesia (even for the funeral of his only granddaughter). Police refused to follow Indonesian law -- which requires that investigators speak to both sides, including to experts who could have exonerated Newmont employees.

• October 2004 – The World Health Organization and the Japanese Minamata Disease Institute released a study finding mercury levels in villagers to be within normal range, thus no Minamata disease. Two additional studies [by the Indonesian Ministry for Environmental Affairs and the Australian Commonwealth Scientific and Industrial Research Organization (CSIRO)] confirmed Newmont’s own studies – Buyat Bay is not polluted. [Charts are available to show scientific data gathered on Buyat Bay arsenic and mercury levels in both seawater and fish.]

• December 21, 2004 – Buyat Bay community leaders wrote to government officials stating that “the issues that have been reported in various mass media prove to be very contradictory to the true situation and condition on the ground. The issues have been blown out of proportion.”

• December 22, 2004 – Villagers withdrew their civil lawsuit against Newmont, stating their accusations against the company were “baseless.”

• December 23, 2004 – Newmont won Habeas Corpus appeal; Jakarta District Court ruled that the police investigation was illegal. Police refuse to follow Habeas Corpus decision.

• February 14, 2005 – Dr. Jane Pangemanan retracted police complaint with formal letter, saying her accusations against Newmont were never based on any evidence. All accusations against Newmont now dropped, but police continued their investigation which resulted in criminal indictment of Newmont and Rick Ness.

• March 2005 – Supreme Court reviewed and overturned Habeas Corpus decision despite Indonesian law barring its appeal. The Supreme Court Chief Justice said: “Sometimes when handing down judgments we must refer only to the law. However, other times we must evaluate the law based on social interests.”

• March 9, 2005 – Indonesian Ministry of Environment filed a $133 million dollar civil suit against company. Later, the Government announced it would settle suit out of court.

• May 6, 2005 – Ministry of Health released comprehensive testing of Buyat Pantai villagers and concluded there was no evidence to find health problems in village caused by heavy metals.

• August 2005 – Newmont won a defamation suit against a local NGO leader. The court fined the NGO leader $750,000 for falsely claiming Newmont polluted Buyat Bay and killed villagers.

• September 20, 2005 – A panel of five Manado District Court judges rejected Newmont’s separate set of legal “exceptions” to the criminal case against Newmont President Director, Rick Ness and the company. In The Manado Post, the day before the hearing, the article stated that 3 of the 5 judges had decided the case should have been sent back to the prosecutor. After the decision, news coverage from Agence France Presse, Reuters, and Bloomberg News questioned whether the judges’ decision was further evidence of a weak Indonesian legal system.

• October 7, 2005 – Evidentiary stage of criminal trial against President Director Rick Ness and Newmont commences.

• November 16, 2005 – Court dismisses civil suit against Newmont.

• Present – The hearings continue please see trial logs for more details.