Freeport Protection Money: Military denies, Police admits

On December 27, The New York Times published an amazing investigative report on Freeport Indonesia's operation in Papua province. The report titled The Cost of Gold, The Hidden Payroll; Below a Mountain of Wealth, a River of Waste.

Freeport, one of the world's largest mining companies, according to the Times, has dumped tons of waste into one of the world's last untouched landscapes while digging for gold in Indonesia.

That's not a brand new finding. Tons of reports about environmental problems from the company's operation have been published.

But what makes the report distinctive and valuable is the finding on US$20 million payment made by Freeport to Indonesian military and police high-ranking officers during the period of 1998-2004 alone. One field commander even got US$150,000 from Freeport.

Earlier report Global Witness titled Paying for Protection disclosed some payments appears to had been made by Freeport fo general Mahidin Simbolon (US$247,705 in the period of Mary 2001-March 2003), Colonel Mangasa Saragih (US$44,000), Colonel Togap Gultom (US$12,213), and Captain Margus Arifin (US$46,000).

Institutionally, Indonesia military denied such report. As reported by Tempointeraktif.com today, Col. Ahmad Yani Basuki, spoke person at TNI (Indonesian military) said "institutionally, TNI never received such security payment."

But Indonesian Police spoke person Anton Bahrul Alam admitted such payment. "Freeport is a vital object for the state that should be protected. It is just normal if pocket money is given for security arrangement there," Anton is quoted by Koran Tempo today.

In March 2003, The Jakarta Post published an article Freeport paid Indonesian military US$5.6 million in 'protection money' based on the company's disclosure to US Securities and Exchange Commission.

Freeport paid the TNI about US$5.6 million in 2002 to to protect employees of its giant copper and gold mine in Papua province. Sadly, no detals of whether the money went to the TNI institutionally or person in charges only.
The TNI, which is combating a sporadic and low-level separatist revolt in Papua, has been accused of widespread abuses in the province, including the killing of pro-independence leader Theys Eluay.
Freeport also said that in 2001 it paid the military $4.7 million for the employment of about 2,300 "Indonesian government security personnel".
The money covered costs for housing, fuel, travel and vehicle repairs for the military, Freeport wrote in the document. It also paid 400,000 dollars in 2002 for "associated infrastructure" in Indonesia, according to the document.

Freeport is not alone. Back in June 2001, The Indonesia Human Rights Network applauded a lawsuit filed in Washington naming the oil giant ExxonMobil Corporation as responsible for murder, torture, kidnapping and twelve other charges at its liquefied natural gas operations in Aceh, a region on the northern tip of Sumatra, Indonesia.
The suit, filed on behalf of eleven Acehnese villagers, claims that ExxonMobil hired the Indonesian military to provide security for the corporation's facilities in Aceh. These troops, under the employ of ExxonMobil, committed human rights abuses against the local population.
Troops stationed at the ExxonMobil facilities tortured villagers in buildings on ExxonMobil property, according to the filing by the International Labor Rights Fund. So, far no information available on this case.

Beyond Petroleum (BP), which has begun a liquefied natural gas project in the Bintuni Bay area of West Papua, has taken pains to avoid the problems that havedogged Freeport by advocating a community security force instead of the Indonesian military. But the future of such arrangement yet to be tested as the construction is just about to start.

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