Press Release: KEM ceased production
Friday, February 11 2005 - 01:39 AM WIB
KEM has been operating in Kelian, Linggang Bignug Sub-district, Kutai Barat Regency, East Kalimatnan Province, since 1992. The company?s Contract of Work was signed in 1985, and was then improved into a lease agreement. Mining activities in its open pit were stopped in May 2003 after gold ore deposit in the location had been exhausted. Processing of the remaining ore stockpile continued until KEM ceased its production last Monday (7/2).
Mine closure is carried out with reference to the recommendation made by the Mine Closure Steering Committee (MCSC). The document has been approved by the Government and is used as the basis for the implementation of mine closure. The committee was established in 1999 and started work in 2001 and completed its tasks in June 2003. It was co-chaired by KEM?s President Director and Kutai Barat Regent. MCSC?s membership represented the involvement of stakeholders, i.e. Government (central, provincial and regional), legislative institution (Regional House of Representative or DPRD), community (non-governmental organisations and customary institutions), academicians and companies.
Model
KEM?s mine closure is implemented beyond compliance and in a comprehensive and sustainable manner. The mine closure is implemented in a technically, environmentally and socially thorough manner so that sustainable benefits for the community can be achieved optimally.
The pattern of the mine closure implemented by KEM constitutes a benchmark both in Indonesia and in the international level. It is used as a model of business partnership for development by World Bank.
The Kelian mine is located in an area regulated by the Department of Forestry. The area used is 1,192 hectares out of the 6,670-hectare lease area. Out of the 1,192 hectare area used for mining activities, 1,016 hectares (85%) had been rehabilitated up to December 2004. KEM will continue to carry out reclamation and rehabilitation (2005 ? 2008) and post closure monitoring (2008 ? 2013).
KEM?s mine site rehabilitation is a part of its mine closure programmes, which refer to sustainable environmental management. The forest, which used to be a mine site, will be handed over to the Government in 2013. Sustainable monitoring (2013 onwards) will be carried out by PT Hutan Lindung Kelian Lestari, a non-profit company employing local people. This non-profit company will be funded through a trust fund, which will be available as long as the ex-mine site is converted into a protection forest.
Further Works
During its operation period, KEM produced an average of 14 tonnes of gold per year and approximately 10 tonnes of silver per year as a by-product. At the peak of its operation, KEM employed around 1,200 employees, 80 percent of them coming from East Kalimantan. KEM started its redundancy programme in December 2001. Up to early 2005, KEM has gradually made more than 800 employees redundant. This redundancy programme is accompanied with the provision of a redundancy package amounting to approximately 43 to 60 times of each respective employee?s current salary.
Approximately 400 KEM employees who still remain will receive a redundancy package simultaneously late February 2005. A part of the 400 remaining employees will be reemployed as contract employees during the period of 2005 ? 2007. They will be assigned to continue jobs related to the mine closure process. KEM received a national bipartite award as a company that has not experienced any employee strike over the past five years and that has managed to reduce more than 800 employees without unrest.
Following cessation of its production, KEM will continue to implement its mine closure programmes, such as reclamation and rehabilitation (February 2005 ? 2008) and sustainable monitoring (2008 ? 2013). (end of release)
For further information, please contact:
Ali Ahmid, Manager Employee and Community Relations
Phone: +(62-542) 765 861, ext. 504
Fax: +(62-542) 761 818
Email: ali.ahmid@ptkem.co.id
Website: www.keliangold.com