The social and environmental impacts of the Freeport-McMoRan Copper and Gold mine in Irian Jaya (West Papua) (operated by its subsidiary P.T. Freeport Indonesia, PTFI) have come under close scrutiny over the last year. Starting in April 1995, a series of reports, released by the Australian Council for Overseas Aid (ACFOA), Bishop Munninghoff, and the Indonesian National Human Rights Commission (Komnas HAM), documented grave human rights abuses in and around the Freeport concession area. In March 1996, rioting in Timika and Tembagapura refocussed international attention on the area. Most recently, Freeport has issued statements claiming inaccurately the resolution of long-standing environmental issues and conflicts with local communities. The following concerns were raised by participants in the Tenth INFID Conference.

Human Rights Violations

INFID welcomes Freeport's public statements deploring the human rights violations in and around Freeport's concession area. However, as a result of Freeport's close relationship with the military and the military's use of Freeport's equipment and facilities, INFID believes that Freeport cannot avoid the question of corporate responsibility for the human rights violations which have occurred within its area of influence. The recent deployment of up to 1,200 additional military troops to Timika and Tembagapura has significantly aggravated the atmosphere of fear and intimidation for local people and has created an environment in which further human rights abuses by the military can easily occur. For example, local indigenous peoples are currently experiencing harassment by military and difficulty in travelling from village to village.

Freeport's top priority should be to prevent further human rights abuses in its area of influence. In order to accomplish this, Freeport should:

• immediately request the Indonesian government to reduce the military presence in Tembagapura and Timika;
• invite and fully cooperate with all human rights investigative teams, including The National Human Rights Commission (Komnas HAM); and
• encourage and facilitate the establishment of an independent human rights body in Timika to monitor the local human rights situation, including violations against women.

Recent Meetings Between Freeport and Local Indigenous Leaders

The March 10-12 riots in Tembagapura and Timika took place in a context of local indigenous groups' anger and frustration with Freeport's presence in the region. Freeport's operations have had adverse social and cultural impacts on local communities. In particular, indigenous communities' ability to exercise their rights to land and other natural resources has been compromised by resettlement, environmental degradation, and the influx of sponsored and spontaneous migrants to the area. Freeport's company towns have created expectations for employment and other opportunities for local people, many of which have not been realised. The military's role in protecting Freeport operations has also exacerbated problems between Freeport and local people.

INFID supports the efforts of local indigenous peoples to resolve disagreements and problems with the company through peaceful mediation and negotiations. Unfortunately, in the aftermath of the riots, the March 14 and April 13 meetings between local indigenous leaders and Freeport CEO James R. Moffett were conducted in the presence of heavily armed military guards in an atmosphere of intimidation and coercion. INFID condemns the heavy presence of military which clearly prevented an opportunity for serious and open dialogue and negotiation.

INFID also rejects Freeport's misrepresentation of the results of the April 13 meeting. Full-page newspaper advertisements which appeared in US newspapers on April 25 state inaccurately that "Freeport finalised an agreement with local indigenous leaders". This advertisement directly contradicts a statement by Freeport Vice President Paul Murphy, who conceded at a public forum sponsored by ACFOA and INFID on April 24 that the April 13 meeting did not result in an agreement, and was only the beginning of a process of negotiation with the Amungme and Komoro people. INFID urges Freeport to respect the decision- making processes of these peoples and give them sufficient time to properly consider proposals before them.

INFID calls upon Freeport and the Indonesian government to address the causes of the riots and make concrete efforts to improve relationships and reach just agreements with local indigenous groups, especially the Amungme and Komoro, whose traditional lands Freeport operations occupy. Freeport and the Indonesian government should promote lasting solutions to its conflict with the Amungme and Komoro through meetings conducted with an independent professional mediator and monitored by a mutually agreed independent party. Meetings between the company and indigenous groups should also be conducted without the presence of military.

In order to improve relations with local indigenous peoples, INFID encourages the reform of Freeport security, including a ban on the hiring of military or ex-military personnel. Freeport security should act with full respect for basic human rights and sensitivity to local cultural valves. The company should solicit suggestions from local people about possible reforms.

Environmental Concerns

On April 19, Freeport released the results of an environmental audit conducted by Dames and Moore, and announced the reinstatement of $100 million political risk insurance from the US Overseas Private Investment Corporation (OPIC), which had been cancelled on environmental grounds in October 1995.

Contrary to the impression left by Freeport's April 25 newspaper advertisement, INFID believes that neither the settlement with OPIC nor the environmental audit prepared by Dames and Moore provide a seal of approval of PTFI's environmental performance. The audit report makes clear that Freeport's commitment to the environment is relatively recent, and that many of the environmental management measures deemed "appropriate" by the audit team are only in the initial stages of implementation, or were only agreed to in the course of the audit itself.

Examples are provided by the report's description of PTFI's management of tailings and rock waste overburden, which are two of the most important environmental impacts of the Freeport mine. A proposed lowland tailings storage area -- which will impact some 130 square kilometres of riverine forest -- is still under construction, and until it is complete, according to the audit team, there is the risk of a large-scale flood that could severely impact additional rainforest. With respect to the rock waste, the audit team found "conclusive evidence" that overburden from the mine is leaching acids into surface water, but PTFI's plan for dealing with this problem is not yet finalised, much less implemented.

While the audit report is internally inconsistent in many respects, and appears to be the product of a negotiation between the audit team and the company, it nevertheless includes some valuable recommendations that INFID supports. In particular, INFID supports the audit's recommendation that an environmental advisory body be constituted with independent membership, and that environmental performance targets be set and the results of periodic monitoring publicly reported. Only with such mechanisms for transparency and accountability in place will the public be able to measure the degree to which PTFI complies with the commitments it has made to improve its environmental performance.

Freeport Relations With Non-Governmental Organizations

INFID is encouraged by PTFI Vice President Paul Murphy's statement on April 24 that Freeport seeks the help and cooperation of NGOs. However, NGO involvement would not be possible without Freeport reversing its previous actions related to NGOs. In particular, INFID condemns Freeport's attacks on the Indonesian Environmental Forum (WALHI), and Freeport's attempt in September 1995 to pressure USAID to withdraw financial support to WALHI.

INFID believes that the development, institutional strength, and independence of NGOs is a key element in the development of civil society. The independence of NGOs must be seen as a positive force, rather than a threat to civil society or to economic progress. Support for independent advocacy carries with it the possibility of disagreements, sometimes vociferous, which become part of the fabric of public debate and discourse in a free society.

Freeport is entitled to criticise WALHI's statements and actions. But the company should not seek to undermine or cripple WALHI by attempting to deny its funding or right to operate. USAID has recognised this by its continued support to WALHI.

INFID recognises that Freeport has made a number of commitments towards resolving longstanding disputes and serious problems in regard to its presence and operations in Irian Jaya. However, the company's misrepresentations of progress in resolving environmental problems and social conflicts raise questions about its good faith, and preclude constructive collaboration with affected groups. INFID believes that the realisation of the promise of Freeport's commitments will require a long-term effort, the success of which will depend upon mechanisms to insure transparency and accountability, and the meaningful participation of local communities, responsible government agencies, and elements of civil society, including NGOs.

26-28 April 1996, Canberra, Australia