Govt must stop protest against mines, IMA says

The government must stop protests against overseas-run mining and oil companies from escalating or production and future investment may be. affected, the country?s mining association says, The Jakarta Post reported on Wednesday.

Protests in the past week against Newmont Mining Corp., Freeport-McMoRan Copper & Gold Inc. and Exxon Mobil Corp. have prompted two Cabinet meetings in two days. The disruption appears coordinated, the government said Monday.

The government wants to raise economic growth above 6 percent annually to generate jobs for the country?s population of 238.5 million people. Keeping the mines running, and attracting more foreign investment, is vital as Indonesia?s mining industry revenue almost doubled to Rp 17.68 trillion (US$1.9 billion) in 2005.

?The government must overcome this situation or the country cannot survive,? Jeffrey Mulyono, chairman of the Indonesian Mining Association (IMA), said by telephone Tuesday. The government must be firm.?

Protests on Sunday against an agreement giving Exxon Mobil the operating rights to a $2.6 billion oil field in Central Java were counterproductive because the state oil company PT Pertamina and central and provincial governments owned 93.25 percent of it, said Energy and Mineral Resources Minister Purnomo Yusgiantoro.

?Indonesia is the biggest shareholder in the project and any disruption to the operation means it is disrupting the country,? Purnomo said at a House of Representatives hearing late Monday.

The March 15 agreement ended a four-year dispute over the field that contains 600 million barrels of oil and 1.7 trillion cubic feet of gas. Crude oil prices hit records and Indonesia?s fuel imports reached as much as $1.6 billion a month during the dispute.

About 1,500 protesters who tried to enter the site to protest the agreement on Sunday were stopped, Purnomo said.

?It seems every policy decision must be followed by having demonstrations,? Jeffrey said.

Coordinating Minister for Political, Legal and Security Affairs Widodo Adi Sucipto on March 19 dismissed demands that Freeport?s Grasberg mine, the world?s second-biggest copper and largest gold mine, be closed after four men were killed in March 16 protests.

The government owns a 9.36 percent stake in the mine in eastern Indonesia. Freeport?s share of reserves as of Dec. 31 was 40.3 billion pounds of copper and 43.9 million ounces of gold.

?That was a good, strong statement from Widodo that there will be no stoppage of the mine, and there will be no renegotiation of the contract,? Jeffrey said.

Widodo also said Monday that the Rp 400 billion that Freeport contributed for community development last year had been mishandled.

Freeport has paid Indonesia about $1 billion since 2004 in taxes, royalties and for security, Chief Executive Officer Richard Adkerson said in January.

The government just wants more transparency in the utilization of the funds the mining companies, have contributed for the public,? Jeffrey said. ?This is happening more and more in a freer society.?

Freeport spokesman Siddharta Moersjid said Tuesday that output has not been affected. The March 16 protests happened in the provincial capital of Jayapura, several hundred kilometers from the mine. (*)