Newmont Mining Corp., the world’s biggest gold producer, will hear today whether it must face its first criminal trial, on charges of polluting the sea off Sulawesi island in Indonesia.
Defense and prosecution attorneys said the hearing had been postponed from Thursday because the judges had been summoned to the capital, Jakarta, by the Supreme Court for training on environmental law.
Presiding Judge Ridwan Damanik will rule today whether the case against Denver-based Newmont and Richard Ness, head of its local unit, should proceed. The defense argues the charges have no basis in law. Ness faces as much as 10 years in prison if convicted. He denies the charges.
Indonesia has some of the world’s largest deposits of copper, gold and tin and depends on mining for 10 percent of its economic output. The Newmont case may harm the country’s attempts to attract foreign investment, said Bruce Gale, a political risk consultant at Hill & Associates in Singapore.
“High-profile cases like these involving foreign companies don’t help the country at a time when it is seeking more overseas investment,” Gale said in a phone interview.
Indonesian President Susilo Bambang Yudhoyono is scheduled to visit New York this month to garner foreign funding for Southeast Asia’s largest economy. The nation’s currency has fallen 5.4 percent since Aug. 18 on spiraling oil-import costs, the result of a drop in investment by overseas companies amid legal and contract disputes.
The country’s central bank raised its benchmark interest rates to a two-year high last week to stem a currency slump.
Seabed Environment Minister Rachmat Witoelar said in November that waste from Newmont’s unit PT Newmont Minahasa Raya caused arsenic levels on a seabed to rise to 10 times the levels allowed in the U.S.
Newmont denies wrongdoing.
The dispute centers on interpretations of pollution tests.
Villagers living near the mine complained to police in July 2004 of health issues after eating fish from the bay. Newmont has said its waste-disposal processes are in line with legal limits.
The company closed the Sulawesi mine last year after the deposit was worked out. The company employs 7,000 workers at another site in the country – a $2 billion copper and gold mine.
