Coal blight in South Kalimantan

Down to Earth No. 43, November 1999

In South Kalimantan province, coal mining - involving Australian companies - is continuing to disrupt the lives of local communities. In Hulu Sungai Utara district, the district head, Suhailin Muchtar said that both legal and illegal coal mining activities had damaged the environment. PT Adaro Indonesia's coal mine (part-owned by Australia's New Hope) operates in this district. Muchtar said dredging had created large "artificial lakes", as well as water and dust pollution. The royalties of Rp 2-3 billion were not enough to cover the environmental damage, he said.

In August a deputation of Dayaks from the district protested against the activities of PT Bantala Coal Mining at the South Kalimantan local assembly in Banjarmasin. For three years the company had polluted their rice-fields, destroyed their irrigation channels and polluted their rivers. The protestors demanded compensation and threatened more action if the problems were not addressed within a month.

The same month, the Indonesian Mining Association (IMA) called for greater effort to deal with illegal mining, which was causing environmental damage and affecting legal operations. The IMA, which represents the industry's interests, said that 22 instances of illegal coal mining had been found in South and East Kalimantan where organised operations with good financial backing used 4,000 dump trucks and even had their own ports to ship coal to other islands and abroad.

In September WALHI South Kalimantan called for a halt to all coal mining in the province at a protest rally involving hundreds of environmental activists and students, outside the governor's office and the local assembly. They said coal mining brought suffering to local people and destroyed the environment. They said the industry was riddled with corruption and was protected by government officials. (Antara 5/7/99; Banjarmasin Post 11/8/99; Indonesian Observer 11/8/99; Kompas 24/9/99)


Promises of reform

Five issues will have to be dealt with by mining companies in the future: human rights, the environment, democracy, intellectual property rights and the free trade era. This was the pronouncement of Mines and Energy Minister Kuntoro Mangkusubroto in September. He said the issues had to be considered in drawing up the new mining law, which is "currently underway".

Like some of Indonesia's other basic laws affecting resources, the Basic Mining Law of 1967 is in the process of being replaced. The new Forestry Law was passed amid much protest (see article above), but the law on oil and gas has been delayed because parliament could not agree on reforms which affect the monopoly of state oil company Pertamina.

On another occasion Kuntoro said that mining companies should not assume Indonesia's government and military will come to their aid if they upset local communities where they operate. He admitted that it was "very easy" for companies to ask for this kind of support in the past but said that this kind of approach "should be left behind."

It remains to be seen how the new government under President Wahid will handle the mining industry. Promises to address community needs have been made before - with little result to date.

(Indonesian Observer 21/9/99; Reuters 24/8/99)