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JAKARTA – It may be a no-go zone for big miners, but deep in the Lorentz National Park, a pristine World Heritage site on the southern flanks of Papua’s Central Highlands lies what geologists call the “Son of Grasberg,” believed to be a major copper and gold deposit lying to the east of the world’s most profitable mine.
“Every single company that has seen the data has said this is the top exploration target in the world,” says a source familiar with the results from the only holes drilled in Mamoa, a balding feature rising out of surrounding jungle. “It’s not a mine yet but it’s a playground for exploration.”
An American geologist agrees. “It has all the signs, including a very good magnetic response,” he says of Mamoa, which lies inside the park boundary about 40 kilometers from the Grasberg, the top-ranked global gold reserve and second-biggest copper mine.
Northwest of Mamoa, along the same geological trend line from the Grasberg, is another prospect called Blue Springs, named after rocks stained bluish by copper oxide, the same tell-tale sign that first drew pioneering Dutch geologist Jean Jacques Dozy to the fabulously rich mineral district in the 1930s.
It is only recently that mining firms have been taking a second look at potential strike zones around the Grasberg, which is now in the process of conversion from an open pit to a fully underground operation with an expected life extending late into this century.
The renewed interest may be due in some small part to the passage in early October of the Omnibus Job Creation Law, which hints at a further relaxation of regulations governing mining in so-called protected forest, an often misleading term that generates an outcry from environmentalists and miners alike.
The all-embracing measure appears to dispense with Article 38 of the 1999 Forestry Law in which mining in forested areas is done through the issuance of land use licenses and with due consideration to the long term protection of the environment.
Although all-important implementing regulations are still being worked on, activists are also alarmed over the removal of civil society engagement in sections of the omnibus legislation where there have been changes to the 2009 Environmental Law.
It would be hugely controversial, particularly among conservationists, but the Indonesian government could belatedly exclude Mamoa from the Lorenz while retaining the park’s prized World Heritage status. There’s another catch, however.
Under a 2003 International Council on Mining and Metals (ICMM) accord, 23 of the world’s leading miners have voluntarily agreed not to exploit World Heritage sites administered by the United Nations Education, Scientific and Cultural Organisation (UNESCO).
The list includes Phoenix-based Freeport McMoRan Copper & Gold (FCX), whose chairman, Richard Adkerson, is ICMM chairman, Glencore, BHP Billiton, Anglo American, Barrick Gold, Newmont, Rio Tinto, Mitsubishi, Sumitomo and Nippon Mining and Metals.
But it does not include Chinese multinational companies like fourth-ranked Jiangxi Copper and gold producer Zijin Mining Group, which last year bought FCX’s interest in Serbia’s Timok gold mine for US$390 million.
Although local sources are unaware of any Chinese exploration around Mamoa, they say representatives of Chinese firms are frequent visitors to Timika, the lowland town that serves as the Freeport’s logistics center and a port for its copper concentrate.
An independent prospector’s shallow drilling at Mamoa in early 2006 produced results of up to 4.4 grams of gold a ton, described by a second Indonesian-based geologist as “ridiculously high grade,” but dependent he cautions on future intersections and the width of mineralization.
While Blue Springs has never been drilled, surface prospecting has shown 0.141% of copper per ton, 0.027% of gold and 0.0017% of molybdenum, the classic porphyry suite of mineralization that hints at what the geologist says is “something big” upstream.
For the moment, the main focus is on Wabu, an estimated 4-5 million ounce gold discovery 40 kilometers north of the Grasberg which has attracted interest from Canada’s Barrick Gold, Australia’s Newcrest Mining and several unidentified Chinese mining firms.
But difficult negotiations lie ahead given the requirement for any future foreign partner to establish a $1.4 billion joint venture with state-owned gold producer PT Aneka Tambang (Antam) and the Papua administration in an area currently only accessible by air.
The cost of building an access road across the mountains from the Grasberg was always considered prohibitive, but local government contractors are nearing completion of a new 80-kilometer gravel road from Enarotali in the west to Bilogai, the dysfunctional Intan Jaya district capital in the shadow of Wabu.
Apart from access, the development of the deposit is complicated by the presence of a lower layer of heavy metals such as arsenic, thallium and cadmium that bring with it the threat of dangerous leakage that would imperil the local tribal population unless it is handled carefully.
There are also major social and political issues resulting from conflicts between the majority 50,000-strong Moni population and the Dani, the dominant tribe across large parts of the Central Highlands which in recent years has increasingly muscled in on Intan Jaya’s politics, land and resources.
The two rival tribes fought a war in 2015, triggered by the sale of a large expanse of ancestral land to a Chinese palm oil plantation company facilitated by Dani district chief Natalis Tabuni, 43, whose two elections in 2012 and 2017 were shrouded in controversy.
Papua’s Dani governor, Lukas Enembe, 53, who played an influential role in the outcome of the Intan Jaya election campaigns, took Tabuni on a trip to Shanghai in October 2019 to explore Chinese interest in a major hydroelectric project.
In recent weeks, regular army troops have moved into the district to deal with an outbreak of lawlessness perpetrated by a group of about 200-300 outside tribesmen, some armed with modern weapons, who local sources claim are acting as Tabuni’s private militia force in terrorizing Moni villages.
Developing the Wabu mine under these circumstances could present a major challenge, particularly if draws in the West Papua National Liberation Army (TPNPB), the armed wing of the Free Papua Movement (OPM) which has been fighting for Papuan independence for decades.
Freeport’s operations have often been the target of TPNPB harassment, including regular sniping attacks on traffic negotiating the precipitous road from Timika to the company’s Tembagapura mining camp, the home for about 5,000 of its mine workers.
A unit of the TPNPB claimed responsibility for the December 2018 massacre of 24 workers on the Trans-Papua Highway near Nduga, 150 kilometers southeast of Bilogai, but Institute for Policy Analysis of Conflict director Sidney Jones says the level of central control among its groups is unclear.
In fact, it is often difficult to differentiate between the ideological and money-making motives of what the military collectively calls KKB, or “criminal armed groups.” The killing last September of a local pastor, Yeremia Zanambani, demonstrates what often happens to villagers caught in the middle.
James Robert Moffett, the legendary former chairman of Freeport McMoRan Copper & Gold, always liked to expound on his geologist’s conviction that the Grasberg and a proliferation of gold mines in Papua New Guinea pointed to the presence of other undiscovered deposits stretching across Papua.
When Freeport Indonesia began developing the Grasberg in the late 1980s, Moffett directed exploration crews to embark on an extensive search for promising stream sediments across the Central Highlands seeking to prove his so-called “trendology” theory.
It was during an aerial mapping sweep, using the same magnetic anomaly detectors (MAD) navy reconnaissance planes employ looking for submerged submarines, that Mamoa was confirmed as a prospect of more than passing interest.
However, Moffett’s “high level of enthusiasm,” as one company geologist put it, quickly disappeared when he failed in his effort to have that part of the Lorenz park included in the Freeport’s new Contract of Work Area B, which was finally granted in 1991.
In fact, when the Lorentz was converted into a national park with significantly expanded boundaries in 1997, Freeport had already been compelled to relinquish some areas along the eastern fringe of its 1,670 square-kilometer concession to avoid an overlap.
The largest protected reserve in Southeast Asia, the 25,000 square kilometer Lorenz was placed on UNESCO’s Heritage list in 1999 as a stand-out example of ecological diversity unmatched anywhere in the world.
It is the only park to stretch from a rare equatorial glacier to a tropical marine environment, with its complex geology shaped by the collision of two continental plates containing fossil sites that provide evidence of the evolution of Papuan life.
The Lorenz is home to nine tribal groups, including the wood-carving Asmat who have lived there for 5,000 years. For all that, when it was declared a “strict nature reserve” in 1978, the government forbade any human activity there other than for scientific research and education.
That puzzling anomaly was finally rectified in 1997 when the World Wildlife Fund and regional forestry officials persuaded Jakarta to change its status to that of a national park, with acknowledged community resource rights for its thousands of indigenous inhabitants.
Mining in national parks has been a major issue among Indonesian environmental groups following a July 7, 2005 Constitutional Court decision clearing the way for 13 mining companies with existing concessions to resume operations in what are classified as “protected forests.”
The court’s nine judges voted unanimously to support a parliamentary amendment passed in 2004 lifting a 1999 legislative ban on open-pit mining in protected forests, saying it did not violate the Constitution.
Court president Jimly Asshidiqie asserted that the ban would have a serious impact on the country’s investment climate, noting that in many cases where mining was affected by the ban, the areas designated as protected forest are devoid of tree cover.
That’s because in the mid-1990s, in what appears to have been an exercise in empire-building, the Forestry Ministry arbitrarily expanded the boundaries of many of the country’s reserves and national parks, without conducting surveys to determine exactly what was there.
As a result, the term “protected forest” often becomes an emotive term, creating confusion and angst among conservationists, miners and plantation developers. In many cases, it is either stunted scrub or jungle that has already been cut over by timber companies.
Indonesia’s powerful coal lobby has been the main advocate for changing the rules, but there are numerous examples of small mining companies struggling for years to secure Forestry Ministry permits for exploratory drilling.
When the Lorentz was being considered as a World Heritage site, the then-Megawati Sukarnoputri government had to address UNESCO concerns over development projects that would affect the park, including the possible expansion of Freeport’s mining activity.
Indeed, in October 1999 the World Heritage Committee was advised of an adjustment to the boundaries of the park, which specifically excluded a 150,000-hectare oil and gas concession then held by the US petroleum company Conoco in the southeast corner.
But the Forestry Ministry, the lead agency and carrying more political weight than the Mines and Energy Ministry, ignored a UNESCO suggestion that it put a “keyhole” around Mamoa, with a single river system set aside for future mine waste disposal.
Faced with a similar situation, the Australian government acted differently, key-holing Rio Tinto’s now-exhausted Ranger uranium mine, which was already in operation when the Northern Territory’s Kakadu National Park surrounding it was declared a World Heritage site in the mid-1980s.
The ICMM agreement has ensured that most miners have stayed away from Mamoa, but in 2005 Papua authorities issued a prospector’s license to British businessman Chris Williamson to explore the site, exercising their right under the 2001 Special Autonomy Law.
It wasn’t the first time then-provincial governor Jaap Solossa had invoked the autonomy law to justify his legally-suspect actions on mining and forestry permitting, one of the consequences of Indonesia’s decentralization process which began with the birth of the democratic era.
Short of finance, Williamson drilled only six holes to a depth of 200 meters, still enough to allow geologists to put together a rough assessment of the gold potential. But the drilling did not penetrate the large epithermal copper deposit which is believed to lie at a depth of 2,000-3,500 meters.
Shopping around for partners, Williamson reportedly invited geologists working either directly or indirectly for London-based Anglo American into the Hoea Valley, where they were given 40 or 50 samples from the Mamoa site.
Anglo American’s head office ordered them to leave after being reminded that their presence in the park was a breach of the 2003 agreement. In the end, the drilling produced no takers and Williamson died in Jakarta earlier this year with his dream unfulfilled.
Mining sources say there are few companies outside the big 15 with the technical and financial resources to mount the deep drilling program necessary to tap Mamoa and to overcome some of the engineering challenges if they do.
Even in the early 2000s, it was estimated it would require more than $2 billion just to build the same infrastructure that Freeport had to do in the 1970s, although at 1,000 meters Mamoa lies at a more manageable elevation than the high-altitude Grasberg.
Despite how environmentalists might feel about the impact of another mine in the Central Highlands, Freeport’s social workers maintain there will be little opposition from the 800 Amungme tribespeople who live in the Hoea Valley if it ever does become a reality.
The 8,000-strong Amungme are a relatively small tribal group who also populate much of the area around the Grasberg, where anthropologists say they settled after being driven from their ancestral lands by the Dani in the early 1900s.
They were at the center of a cultural row in the 1980s when First Lady Tien Suharto mounted a campaign to compel them to wear shorts instead of their ubiquitous penis gourds. The idea attracted so much ridicule that it was finally dropped.
Theoretically, Mamoa can be excluded from the Lorentz if the government provides a compelling economic argument and a comprehensive environmental impact study that ensures the park doesn’t lose its World Heritage status in the process.
In 2007, Oman’s Arabian Oryx Sanctuary became the first site to have its World Heritage status withdrawn after the rare antelope species dwindled to a few dozen and the government cut the park size by 90% to accommodate an oil discovery.
“There is no standard answer,” says one UNESCO official, whose organization would ultimately have to sign off on the Lorenz move under the terms of the World Heritage Convention. “It’s case by case, but usually it is very difficult because, after all, the principle of the convention is conservation.”