Unearthing Controversy at the Ok Tedi Mine

by Polly Ghazi

(Washington, DC, July 2003) Papua New Guinea, a country of only 5 million people, is a botanical treasure island. Its relatively pristine rainforests, mountains, rivers, and reefs harbor a host of rare plants, animals, and birds, including flying foxes, river turtles, and the largest orchid, bat, and butterfly species in the world.

Yet in the 1990s, the country became a byword for state-sponsored ecological destruction. The main source of trouble has been the Ok Tedi mine, situated deep in the rainforest-covered Star Mountains of Papua New Guinea’s western province.

Since the mid-1980s, the copper and gold mine has released about 30 million tons of mine tailings and 40 million tons of waste rock into the Ok Tedi tributary of the Fly River every year. The result has been an ecological disaster, and the lives of about 50,000 people living in the 120 villages downstream from the mine have been severely disrupted.

Before the mine, taro and bananas were commonly grown in village gardens and riverside sago palms often provided the mainstay of local diets. By the early 1990s, fish were dying, turtles disappearing, and canoes running aground midstream as the increased sedimentation raised riverbeds. The build-up of sediment in the rivers and subsequent flooding of forests caused fish stocks to fall by 70 to 90 percent, forced many animal species to migrate, and killed or damaged about 1,300 square kilometers of vegetation. The destruction has forced villagers to hunt and fish over larger distances.

Papua New Guinea has some of the largest known copper and gold deposits in the world. However, digging up the deposits at Ok Tedi, which is located more than 2,000 meters high on Mount Fubilan, presented a daunting challenge. The terrain is inaccessible and prone to high rainfall, frequent earthquakes, and landslides.

But the ores presented a tantalizing prospect to Papua New Guinea’s young government, which was elected upon independence from Australia in 1975. With the startup of the Bougainville mine in 1972, which soon became world’s largest copper producer, mining's contribution to national income was substantial. A new mine at Ok Tedi promised to raise it even more.

In 1976, the state of Papua New Guinea authorized Broken Hill Proprietary (BHP), Australia’s biggest mining corporation, to prepare a development plan for the mine. Four years later, the government committed to a partnership in Ok Tedi Mining Limited with a 20 percent shareholding. The other shareholders were BHP, Amoco Minerals, and a consortium of German companies. The mine began operating in 1984 and within a decade, became one of the world's largest copper producers—extracting about 30 million tons of ore each year.

Before the project was approved, the company agreed to build a tailings dam to protect the Fly River. In January 1984, however, a landslide destroyed the dam’s foundations. Under pressure from Broken Hill not to force the expensive building of another dam, the government granted the mining company temporary permission to release mine waste into the headwaters of the Ok Tedi River. In 1988, a rebellion by indigenous landowners forced the Bougainville copper mine to close, reducing national GDP by about 20 percent. Not wanting to lose any more revenue, the government approved Ok Tedi’s controversial river disposal practices, which continue to this day.

Starting in the late 1980s, the Yonggom people and their downstream neighbors petitioned mining company and government officials to address the pollution and flooding that were destroying traditional subsistence lifestyles, forcing some villagers to relocate. One villager reported that “the animals living along the river banks—the pigs, cassowaries, pigeons and bandicoots—have all disappeared,” according to researcher Stuart Kirsch. An anthropologist working with the Wopkaimin people described the mine waste’s impact on local wildlife and people as “ecocide.”

In 1992, a group of indigenous landowners presented their grievances against Ok Tedi Mining to the International Water Tribunal in The Hague. The tribunal’s judgments lack legal force. But its 1992 ruling, that the Papua New Guinea government should either prevent further damage or close the mine, brought Ok Tedi into the international spotlight.

After the case became an international cause celebre, the indigenous peoples living along the Ok Tedi and Fly rivers launched a series of suits against BHP in the Australian courts. The “David and Goliath” legal case against one of Australia’s biggest corporations received widespread media coverage, mostly unfavorable to BHP. In 1996 the two sides reached an out-of-court settlement, which included compensation and a BHP commitment to contain mine tailings. The company agreed to pay affected villagers a total of US$28.6 million.

BHP’s shareholders wanted to close the mine in 2000. But the government and local communities viewed the possibility of the mine’s early closure as the worst of all worlds: depriving local residents of jobs and income, and the region of royalties needed to address ecological problems.

In February 2002, BHP transferred its 52 percent equity to the Papua New Guinea Sustainable Development Program Company, which was created to spend dividend income on development programs. For its part, BHP (renamed BHP Billiton after merging with UK-based Billiton in 2001), now one of the world’s largest mining corporations, received indemnity from future pollution liability.

The mine is scheduled to close in 2010. It remains to be seen whether local control and the revenue from less than a decade of operation can begin to undo the decades of damage done by the mine. (WRI Features, 919 words)