Unocal and Kelian agree to settle dispute with local residents

PT Unocal Indonesia and PT Kelian Equatorial Mining (KEM), both based in East Kalimantan have expressed their willingness to settle their disputes with the local communities, according press report.

Kompas daily reported on Friday that Unocal, which operates oil and gas field in the province, had agreed to meet the local people's demand over the alleged pollution caused by the company on the nearby rice field.

The company however said that it would only pay a "financial assistance" in the settlement deal, not the compensation as demanded by the owners of the rice fields.

"Unocal did not agree to pay compensation but financial aid because a compensation payment should be backed by a proof that the company had really caused pollution to the rice fields," local legislator Ahmad Fuad told reporters after mediating a meeting between the company and the protesting farmers.

The farmers charged the company of causing pollution in their 417.5 hectares rice fields near the company's oil and gas projects. The farmers demanded a fair compensation from the company because they said the alleged pollution had caused a failure on their rice harvest.

Separately, Kelian Equatorial Mining reported that the company had agreed to meet the local demand to pay the compensation for the land used by the company. The decision was made after several negotiations with the residents. (*)