Newmont accused of false data on waste disposal

Government has pressed ahead with plans to prosecute U.S.-based Newmont Mining Corp. (NEM) for allegedly polluting a bay in central Indonesia, accusing the company of giving investigators incomplete information about its waste disposal method, AP reported.

But Newmont's vice president of Indonesian operations, Robert Gallagher, has denied the claim, saying the company gave the government full information.

"The Indonesian government has all the information we have. They approved our system based on that data. It is extremely sound and we see no reason to change it," he said.

Prosecutors are preparing charges against Newmont Minahasa Raya, a unit of Denver, Colorado-based Newmont Mining, for dumping arsenic, mercury and other heavy metals into Buyat Bay on Sulawesi island, causing residents to develop skin diseases and tumors.

At least five Newmont executives - including an American and an Australian - will be charged with corporate crimes in connection with the alleged pollution, prosecutors say. They could be imprisoned for 10 years.

Wednesday, Environment Ministry scientist Masnellyarti Hilman told a news conference that Newmont falsely told the government in 2000 that waste from the mine wasn't getting into the local food chain.

She said Newmont had failed to take in account Indonesia's different seasons and sea currents when it was determining the effect of its waste in the bay.

"Newmont gave incomplete information based on invalid assumptions," she said. "They also did not show the goodwill to change them when asked to review their methods."

Tests have produced conflicting results about water quality in the bay. The World Health Organization and an initial Environment Ministry report found the water unpolluted, but later tests by the police and the environment ministry found evidence of pollution in the bay.

The government's determination to press charges against Newmont has cheered activists, who have long complained that foreign mining operations skirt environmental laws.

But it risks spooking investors. Indonesia's legal system and police are notoriously inefficient and corrupt, and foreign companies regularly complain of intimidation.

Newmont stopped mining two years ago at the Sulawesi site, 2,000 kilometers (1,300 miles) northeast of the capital, Jakarta, after extracting all the gold it could, but kept processing ore there until Aug. 31, 2004, when the mine was permanently shut.(*)