The history of community mining in Kelian
Local people's attempts to fight for their demands
LKMTL's involvement in the Mine Closure Steering Committee
APPENDIX 1: Human rights violations suffered by the Kelian people
APPENDIX II: The community representation's withdrawal from the Kelian mine closure process
Kelian Equatorial Mining (PT KEM) is a mining company registered under Indonesian law which is 90% owned by Anglo-Australian mining company Rio Tinto (the biggest mining company in the world) and PT Harita Jayaraya Inc (10%) – an Indonesian company. KEM signed a Contract of Work with the Indonesian government in 1985 for a 286,233.5 hectare concession. This agreement, signed by the (then) president Suharto, allows KEM to explore for and mine gold in the Kelian area of Kutai district in East Kalimantan province.
The primary gold ore deposits are on the slopes of Prampus Barat and Prampus Timur. The mineable ore is estimated at 53.5 million tons with a gold content of around 1.97 grammes/ton. KEM started production on July1st1991. At that time, the mine was thought to have a lifespan of 9-10 years (ending in August 2002) with production levels at 6 million tonnes of ore processed per year (approx 23,000 tons per day). On average, about 15 tonnes of gold and 13 tonnes of silver are produced each year.
This part of the eastern part of the island of Borneo is largely rugged hills and mountains covered with tropical rainforest. This area is the watershed for the many streams and rivers which drain into the River Mahakam – East Kalimantan's major river. The indigenous (Dayak) community have traditionally depended on clearing some forests to cultivate rice and vegetable crops. When soil fertility drops, this land is used to grow long-term crops such as rattan, various types of fruit trees and palms. After a number of years, this agroforestry system is cleared and replaced by rice farming for several seasons. Under customary law, some forest is never cleared but left intact for spiritual reasons as well as for protection of watersheds and wildlife. People collect a range of forest products for their own needs and for sale such as honey, damar resin and medicinal plants. They also used to hunt for bushmeat.
The history of community mining in Kelian
The community gold mining which is going on around the KEM mine is not the result of the recent discovery of gold in this area by the company. The local community has long known that there was gold in these hills. Stories of gold have been passed down through the generations. Even today the remains of pits and tunnels constructed hundreds of years ago can be found by local people who know where to look.
In 1949, a visiting group of Penihing Dayaks came to the village of Muara Kelian to ask Lung Bulan, the traditional leader of that community, for permission to collect rattan up the River Kelian and to put up some simple shelters at Gah Balui. It happened that when they were washing themselves in the river after a day's work, they noticed that the sand on their bodies was black and shiny like iron filings. They guessed that this sand might contain gold because they had seen local people panning for gold at Danum Biang, near Long Pahangai. So they took a metal plate from their canoe and tried panning themselves. The men soon found tiny grains of yellow metal. By the end of a week they had filled an old lemonade bottle with the yellow metal which they took down river to Long Iram. There, two Chinese goldsmiths examined their find and immediately bought the gold for Rp10 per gram.
News spread that gold had been discovered at Kelian and people rushed from surrounding areas (and eventually from neighbouring islands) to pan for gold too. A small-scale mining industry quickly grew up along the whole length of the Kelian River. Initially, all newcomers only mined with the consent of indigenous community leaders. The population of the Kelian area has obviously increased and become more ethnically mixed since the 1950s. However, families of different ethnic origins share common interests and experiences, so the Kelian community has not experienced the inter-ethnic conflicts which have afflicted other parts of Indonesia in recent years.
KEM comes to Kelian
PT Rio Tinto Indonesia first came to the area in the early 1970s and carried out explorations along the River Kelian at Prampus. The company followed this up by drilling bore holes to take further samples in the Kelian area in 1985. Rio Tinto Indonesia and Buana Jaya Raya Indonesia (a Jakarta-based company) formed PT Kelian Equatorial Mining before applying to the Indonesian government for a concession to explore further and exploit their finds.
From the start, the company claimed that there was no genuine community mining at Kelian. This was a means to avoid paying compensation for the loss of local livelihoods. KEM went on forcibly to evict local inhabitants from Muara Bayaaq to Kampung Baru in 1987. The company forbade local people from gold mining, agroforestry or cultivating fields in the area around the mine site because this was all part of KEM's concession. This ban provoked a strong response from the community (in the form of demonstrations in 1988) who opposed the company's position. KEM responded by bringing in two helicopter loads of security forces. There were a number of other serious human rights violations during the next ten years (see table – Appendix 1) The communities' grievances against KEM's operations in Kelian at that time included the following:
Local people's concerns about KEM generated the following demands:
The community have tried various means to press KEM to meet their demands including:
The negotiations were only resumed in March 2001 after a new Protocol on procedures was reached and KEM had a new chairman. This 'peace deal' was brokered by the chairman of the Indonesian Commission for Human Rights, Asmara Nababan, and Amar Inamdar of the Oxford-based consultancy Synergy. Australian High Court judge Marcus Enfield and Indonesian Supreme Court judge Artidjo Alkostar were chosen as arbitrators. The Protocol – between LKMTL representing the community and the mining company KEM - was witnessed by WALHI and Rio Tinto.
Closure of KEM mine
KEM intends to close its Kelian mine in 2004. It will rework some of the lower grade stockpiled ore and possibly some of the tailings before leaving the site in 2007. In order to prepare for this, the mining company established a Mine Closure Steering Committee (MCSC). This comprises representatives of KEM, Rio Tinto, local government and central government, academics, the local Customary Council and LKMTL (for the community).
Four Working Groups support the MCSC by more detailed planning and technical discussions on:
"In the case of the approaching closure of Kelian in Kalimantan, Rio Tinto has joined the World Bank Business Partners for Development Programme. This brings together the private sector, civil society and government under the convening authority of the World Bank. The idea is to progress situations in which all three partners have an interest but limited chance of success on their own."
This quote clearly shows that KEM was already planning for mine closure by 1998. However, the first the community knew of this was when KEM sent BPD/World Bank consultant Amar Inamdar and Ramanie Kumanayagam (from Rio Tinto London) to talk with LKMTL. It was assumed at the time that his role was to help settle the differences between KEM and the community over compensation demands and human rights abuses, since this was precisely at the time negotiations were deadlocked. They did also discuss mine closure plans.
In September 2000, LKMTL recommended (via KEM's anthropology consultant Michael Hopes) that Niel Makinuddin should be a facilitator in the Mine Closure Steering Committee. KEM also proposed Amar Inamdar as a facilitator. LKMTL hoped that the presence of these two facilitators – one from the community side and one from the company's – would maintain some equality between the two parties' struggle to promote their own interests. Nevertheless, it transpired that only the community's facilitator stuck to the agreement to be neutral. In private, he explained that he had been pressed by KEM to not be biased in favour of the community. The other facilitator did not seem to be under the same obligation and clearly favoured the company in all discussions.
The first meeting of the Mine Closure Steering Committee was held in February 2001 at the Dusit Hotel in Balikpapan. It was agreed that meetings would be held three monthly.
LKMTL chose five people to take part in the mine closure discussions: one for the Steering Committee and one for each of the Working Groups. As the process went along, LKMTL began to feel that its recommendations were not being taken seriously by the company. Local government representatives always sided with the company, so the community was usually 'outvoted'. Furthermore, LKMTL's four Working Group representatives were no longer included in meetings from March 2002 onwards with no explanation from the MCSC secretariat. Representatives from other parties on the Working Groups continued as before. So, despite the way that KEM always claims that the community is fully involved in discussions on mine closure and are equal partners, this is not the case. Eventually, on 19 March 2003, LKMTL decided to withdraw from the MCSC because it was dissatisfied with the process.
The two processes - settlement of outstanding disputes and mine closure – which should be quite distinct, are actually connected in many subtle ways. This becomes more complicated as some of the same figures (including consultants) are involved in both processes. There are suspicions that KEM has deliberately dragged out the compensation and dispute settlement process in order to make sure that the community were part of the mine closure process. Rio Tinto and KEM have tried to promote the Kelian closure plans as a model of good practice for mine closure elsewhere in Indonesia and worldwide. Obviously, they do not want any public discussion of unresolved charges of human rights abuse or environmental pollution.
Further key issues
There remain some major outstanding issues, from the community's perspective (apart from those explained in the March 19th letter).
Time | Incidents |
1949 | A group of Penihing Dayaks visit Muara Kelian and discover gold in the R. Kelian |
1972 | Exploration by Rio Tinto Indonesia |
1976 | Exploration by PT Buana Jaya Raya Mining Company (BJR) |
1982 | Local gold panners told to leave their sites by Long Iram sub-district head to secure the area in preparation for BJR/Rio Tinto's operations |
1982 – 1991 | Forced eviction of hundreds of local miners and burning of their shelters/homes at Gah Macan, Gah Bujang, Gunung Runtuh, Gah Panjang, Loa Tepu, Sungai Tukam, Gunung Runcing, Gah Ekong and Gah Punan |
1985 | KEM's Contract of Work signed |
1985 – 1989 |
The frequency and severity of conflicts between local miners and KEM increased. Evidence for this is: The number of complaints from local people to LKMTL and WALHI about cases of houses or shelters being burnt down, intimidation, evictions, brutality and sexual violence by company employees or local military/police. The number of cases where KEM accused local people of theft of illegal mining within the concession area. |
1990-92 | Construction of processing plant and mine site buildings |
July 1991 | KEM mine starts pilot production |
20 December 1991 | Daniel Paras and his family evicted from their home at gunpoint |
1992 | KEM mine starts commercial production |
19 December 1992 | Local people demonstrate with 7 banners |
22 December 1992 | Number of demonstrators increases to 200 |
24 December 1992 | 400 people demonstrate demanding fair land compensation |
26 December 1992 | 9 people invited to a meeting with Kutai District Administrator but were held in police custody instead |
28 December 1992 | H. Ridwan detained by police |
29 December 1992 | 5 more people held in detention |
31 December 1992 | 200 people demonstrated at Tutung and were confronted by the security forces. KEM agreed to settle compensation claims, but the local government was slow to act. |
5 January 1993 | Eduard Tarung died in police custody (aged around 80) |
1987 – 1997 | Detention, torture of local people and confiscation of their mining equipment and other belongings at Gah Macan, Gunung Runtuh, Gunung Runcing, Gunung Gundul, Muara Nakan, Camp Prampus, Gah Punan, Gah Sadiah, Rodah Lampung, Gah Donggo and Gah Ekong |
1990 – 1997 | Repeated thefts of equipment from KEM mine site |
1997 – 1998 | Inhabitants of Gah Donggo (at edge of mine site) blamed for thefts and suffer intimidation from KEM and local police |
6 February 1993 | Mukidin Anshori is drowned in Nakan tailings dam after being pursued by KEM security guards |
1989 – 1994 | 10 cases of violence against women |
1994 – 1997 | 7 more cases of violence against women |
APPENDIX II
The community representation's withdrawal from the Kelian mine closure process
From:
The Association for the Welfare of the Mining Community and Environment
(Lembaga Kesejahteraan Masyarakat Tambang dan Lingungan – LKMTL)
Re:
LKMTL'S WITHDRAWAL FROM THE MINE CLOSURE STEERING COMMITTEE (MCSC)
Melapeh Baru, Kutai Barat District, East Kalimantan, Indonesia 19th March 2003
To:
Chairman of the Mine Closure Steering Committee of Kelian Equatorial Mining
President Director, Rio Tinto Indonesia
President Director PT Kelian Equatorial Mining
Dear Sirs
As part of PT KEM's mine closure plans, LKMTL has been involved in the Mine Closure Steering Committee team, both as a member of the Steering Committee and its Working Groups, as the representative of the community around the PT KEM mine. Based on our observations gained during nearly two years of participation in meetings to discuss the post-mine phase, we are sending this letter to put forward some of the community's suggestions and requests relating to the environmental and social conditions after the mine has closed. We do not think the MCSC has given these and other points serious attention and consideration.
Thank you for your attention.
Yours sincerely
Pius Erick Nyompe
Executive Director LKMTL