*** Newmont says "No crime" on eve of pollution trial ***
"No crime" Newmont says on eve of pollution trial
Tue Aug 2, 2005 07:11 AM ET By Karima Anjani and Tomi Soetjipto
JAKARTA, Aug 2 (Reuters) - U.S.-based Newmont Mining Corp denied on Tuesday any wrongdoing by an Indonesian subsidiary charged with pollution, days before it and its American boss face a trial investors and environmentalists will be watching closely.
PT Newmont Minahasa Raya and President Director Richard Ness are accused of disposal of toxic waste that polluted a bay in eastern Indonesia.
The trial begins on Friday in Sulawesi island's Manado. If found guilty, Ness, who has lived in Indonesia for decades, could be locked up for up to 10 years, and the firm could be fined.
Analysts say legal defeat for Newmont (NEM.N: Quote, Profile, Research) , the world's biggest gold miner, could send a chilling signal to investors already concerned about coping with corruption and bureaucracy in Indonesia, the world's fourth most-populous country,
Environmentalists counter that Indonesia has been too lax for too long when it comes to making companies follow the rules in the sprawling archipelago of some 17,000 islands.
Newmont itself says it is innocent.
"There has been no crime committed and (it) looks like we're going to end up in court to show that, and we anticipate that we will show that," Newmont's vice president for Indonesian operations, Robert Gallagher, told reporters.
The trial comes at a time when foreign investment has begun to revive in Indonesia, partly on promises by President Susilo Bambang Yudhoyono, who took power last October, to make the country an easier place to do business.
A guilty verdict would harm Newmont's image in a nation where it still has ambitious plans. Five years ago, Newmont started operations of Asia's second-largest copper mine, Batu Hijau, on Indonesia's Sumbawa island. That complex has a mine life of more than 20 years.
The charges against Newmont revolve around waste disposal containing mercury and arsenic in Buyat Bay, 2,200 km (1,400 miles) northeast of Jakarta, which prosecutors say polluted the waters and contaminated the food chain, causing skin disease among surrounding villagers.
Asked how he felt about the trial, Newmont's Ness said: "I guess nobody wants to be accused of committing a crime, nobody wants to be accused of hurting people, creating pollution".
The mine in North Sulawesi opened in 1996 and closed last August due to depleted reserves. Newmont has been carrying out reclamation work since then, but the pollution charges relate to when the mine was operational.
Newmont says its disposal processes at the bay were approved by the government, and several independent studies have supported the company's claim they did not pollute the bay.
However, a government-commissioned multi-agency probe and a police study found otherwise.
Some criticism of Indonesia over the case has centred less on details of the charges than on whether it was necessary to imprison several company executives while investigations were under way, and restrict their travel for a time after they were released.
Indonesia operations represent about six percent of Newmont's global sales worldwide in 2004.
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