Asia Times: BHP Billiton leaves the scene of the crime


	January 5, 2002	atimes.com

Oceania

BHP Billiton leave the scene of the crime
By Danielle Knight

WASHINGTON - For over a decade, Papua New Guinea's Ok Tedi mine has been the subject of environmental complaints. In the latest development, its Australian-majority owner is finally pulling out - but not without generating fresh controversy.

Watchdog groups and activists assert that Melbourne-based Broken Hill Properties (BHP) Billiton is avoiding responsibility for years of dumping toxic waste in nearby rivers, among other environmental offenses. Mine executives counter that the company is merely seeking to shield itself from liability arising from any future incidents.

BHP Billiton is in the final stages of selling its 52 percent stake in Ok Tedi, located in the mountains 18 kilometers east of the Indonesia-Papua New Guinea border. Papua New Guinea Sustainable Development Program, a newly created Singapore-based company, is the buyer. The Papua New Guinea government remains a 30-percent owner and Inmet Corp of Canada retains the remaining 18 percent.

The Papua New Guinea parliament approved the deal earlier this month but prominent citizens, some landowners near the mine, and environmental groups worldwide say that BHP Billiton has admitted to contamination of local rivers and rainforest but is walking away with a guarantee of immunity against any claims for these damages.

Roger Higgins, managing director of Ok Tedi Mining Ltd, disputes this interpretation of the agreement, saying that it only protects BHP against lawsuits stemming from incidents that occur after it gives up the mine. "The indemnity is for actions that are consequential after BHP leaves and does not cover anything that has consequence of the operations while BHP was the manager," Higgins told ABC News.

BHP Billiton originally had sought to close the mine rather than face environmental litigation. The World Bank recommended in 2000 that Ok Tedi be closed because of environmental damage caused by mine waste, also known as tailings.

Papua New Guinea Prime Minister Mekere Morauta and local communities economically dependent on the mine, however, strongly oppose closing Ok Tedi. Morauta has said that he regards the mine as a national asset and fears that closing it would devastate the national economy. Ok Tedi accounts for 10 percent of gross national product and 20 percent of exports. The 16-year-old mine is one of the richest in the Southern Hemisphere, yielding some 600,000 tonnes of high-grade copper concentrate and 15 tonnes of gold per year.

The Mine Continuation Agreement proposed by BHP Billiton and approved by Papua New Guinea lawmakers prohibits the state from pursuing or supporting any environmental claim against the company. "The new law will leave Ok Tedi's environmental and social problems for local people and an impoverished Papua New Guinea government to fix up, while BHP Billiton - the world's largest mining corporation - will walk away," said Geoff Evans, director of the Australia-based Mineral Policy Institute.

Former Papua New Guinea prime minister Michael Somare agrees and on Tuesday submitted a constitutional challenge to the agreement. "This law will now prevent any landowner from taking any court action against a developer," said Somare.

Environmentalists estimate that the mine dumped 80,000 tonnes of waste into nearby rivers every day, devastating fisheries and drinking water supplies. BHP Billiton has acknowledged that the waste will kill more than 2,000 square kilometers of the forest along nearby rivers. "Nothing should cloud BHP's full responsibility for these problems," said Stephen D'Esposito, president of the Washington-based Mineral Policy Center, an environmental advocacy group.

In 1996, Ok Tedi Mining paid US$39 million in an out-of-court settlement to 30,000 villagers whose livelihood relies on fishing the nearby rivers. As part of the agreement, the company committed to stop dumping its waste. But in April 2000, villagers were in court arguing that the waste was still being dumped.

Landowners are now seeking to extend an interim injunction to prevent the mine's owners from collecting signatures to approve a Community Mine Continuation Agreement. This accord, an adjunct to the main agreement penned by BHP Billiton, would also shield the company from litigation, including the April 2000 lawsuit, according to critics.

In order to become law, the agreement must be signed by a representative of communities living near the mine. Matilda Koma, an activist with Papua New Guinea-based Environmental Watch Group, said that she worries that the agreement will be given legal force no matter who signs it on behalf of the community. She points to part of the agreement that states that it must be signed by a member of the community even if "there is no express authority for that person to sign or execute the Community Mine Continuation Agreement on behalf of the members of the community or clan concerned". The agreement, said Koma, "deprives a whole community or clan of their rights".

(Inter Press Service)