DTE questions at BHP Billiton AGM

Shifting coal in Kalimantan (JATAM)

The following is extracted from 'Killing me softly with his song: inside another BHP Billiton AGM', October 25, 2012. Reflection by Richard Solly, Co-ordinator, London Mining Network.

Andrew Hickman of Down to Earth spoke of the destructiveness of the company’s coal project in Kalimantan, Indonesia. He was told that the company was still studying possibilities and would not go ahead with any major project during the coming year...

...Andrew Hickman asked about BHP Billiton’s activities in Indonesia, and particularly IndoMet in Kalimantan. He said that there was nothing about the project in the Customer Group section of the annual report. Jac Nasser said that there was information on page 37, under ‘Development Projects’.

Andrew continued: “In the context of recent developments with regards Bumi plc, another UK-connected coal operation in Kalimantan, I wanted to ask about this project, which I think we can categorize as the ‘ultimate green-field site’, overlapping conservation areas, being developed by BHPB that is opening up a whole new region of Kalimantan for coal exploitation.  The context of these operations and its impacts for the people of Kalimantan and Indonesia were highlighted recently by a report of the Indonesian government’s Anti-corruption Commission (BPK) which sets out some of the social, environmental and economic risks of coal mining in Kalimantan.

  • Over 1,000 mining companies that fail to comply with environmental requirements.
  • 329 companies evading royalties
  • 43 not fulfilling reclamation and rehabilitation guarantees
  • and 5 miners in East Barito region of Central Kalimantan operating without a licence.

“Into this environment, BHPB is developing its Indomet operations.  The chairman has talked about its social and environmental responsibilities and of being a leader in this field.  I would suggest that BHPB is acting as a kind of Trojan Horse in the development of mining activities in Central Kalimantan.

“I would like to read something that the company has said in a past Sustainability report:   ‘By starting small, our aim is to develop further understanding of and experience in how to manage the environmental and biodiversity impacts within the region before large scale operations commence.’

“News of BHPB’s signing of a new Public Private Partnership Agreement with the Indonesian government and others to build an trans-Kalimantan coal railway, we understand that the company is building roads and ports and beginning its operations.  This is a project that reportedly is involving billions of dollars of investment.

“My question is the following:   Does BHPB still consider that it is starting ‘small’?  If so, what exactly is it that BHPB has learnt in the years of developing the project?”

 Jac Nasser [BHP Billiton Chairman] replied that, on corporate fraud, BHP Billiton simply did not work in that way. The other issues mentioned were important. BHP Billiton had been looking at this project for some time and is progressing certain elements such as the railway which would aid in the initial stages of mining. The company understands the significance of the Heart of Borneo and is engaging with all stakeholders. He said he looked forward to discussing specific issues.

Marius Kloppers [BHP Billiton CEO] added that the project did not yet involve a mine, and that there were many complexities. There are oil palm plantations and other mining companies in the area, and not all of them were perfect in their conduct. BHP Billiton wants to do things correctly. The company does not expect any major new project sanction within the coming year, which means that no funding will be released, including for the railway – though a study of a possible railway is being conducted. He repeated that the project would not go ahead during the coming year.

Go to the full report by LMN, which includes questions and answers on climate change, Cerrejon Coal and Cerro Matoso (Colombia), Free Prior and Informed Consent for Indigenous Peoples, biodiversity and labour rights.


See also LMN & War on Want press release October 25th, 2012: World’s biggest mining company, BHP Billiton, holds its annual meeting.