Newmont Exec, Company Found Not Guilty

Richard Ness, president of the Indonesian subsidary of the Denver-based Newmont Mining Corp., speaks during an interview with the Associated Press in Washington in this Feb. 7, 2007 file photo. Ness learns Tuesday, April 24, 2007 if he will be thrown in jail for allegedly sickening Indonesian villagers by dumping mercury and arsenic-laced waste into a bay _ wrapping up a trial closely watched by both foreign investors and environmentalists. (AP Photo/Gerald Herbert, File) (Gerald Herbert - AP)

MANADO, Indonesia -- An Indonesian court on Tuesday acquitted a U.S. executive and his company, Newmont Mining Corp., of dumping dangerous levels of toxins into a bay and sickening villagers, a verdict likely to cheer foreign investors and anger environmentalists.

Richard Ness, 57, faced a maximum 10 years in jail and a $60,000 fine.

Presiding judge Ridwan Damanik told the Manado District Court that evidence presented during the 20-month criminal trial proved waste rock dumped into the water by Denver-based company's now-defunct mine on Sulawesi island did not exceed government standards.

"There also is not enough evidence that people suffered from health problems," the judge said, drawing cheers from Newmont's supporters in the sweltering court. Defense lawyers and family members threw their arms around the smiling Ness, the president director of Newmont's local subsidiary.

Prosecutors immediately said they would appeal as hundreds of demonstrators ringing the building chanted, "Reject the verdict!"

The trial was being closely watched by foreign investors already wary about legal uncertainties in Indonesia, which boasts some of the world's largest gold, tin, copper and nickel deposits but is also considered among the most corrupt nations.

Red tape, rising prices, political instability and labor problems add to their concerns.

"A guilty verdict would of course affect the investment climate," Witoro Soelarno, of Indonesia's energy and mineral resources department, said before the verdict was announced. He noted that foreign companies have all but abandoned the mining sector since the 1997-98 Asian financial crisis.

"We would have to work ever harder to lure them back," he said, pointing also to concerns about a draft mining bill that would require companies to work with regional authorities instead of the central government.

Environmentalists had hoped the cash-strapped government would find a multinational corporation guilty of pollution charges, noting that the country's unique and rich ecosystem were steadily degrading.

About 1,000 protesters gathered outside the tightly guarded court Tuesday, some holding banners that said "Sentence Newmont!" and "Improve Indonesia's environmental laws!" Others rallied in the coastal city on motorcycles, snarling traffic.

"We want Newmont and its director to take responsibility," said protest organizer Didi Koleangan, referring to allegations villagers living near Buyat Bay complained of skin disease, lumps, breathing difficulties and dizziness.

Though evidence presented to the court was limited to a few villagers complaining of itchiness, some activists say follow-up research should be conducted for up to 30 years to make sure they are not suffering from body arsenic accumulation.

The lengthy trial was complicated by conflicting test results.

A police report showed mercury and arsenic levels in Buyat Bay, 1,300 miles northeast of Jakarta, were well beyond national standards. But tests by the World Health Organization, Indonesian government agencies and several independent groups found that pollutants in the water were well within normal limits.

"The police evidence doesn't stand up," said Damanik, who headed a panel of five judges.

Newmont, one of the world's largest gold miners, began operations in Sulawesi in 1996 and stopped mining in 2002 after extracting all the gold it could. But it continued processing ore until Aug. 31, 2004, when the mine was permanently shut.

Other large mining companies operating in Indonesia are Freeport-McMoRan Copper & Gold Inc. and Rio Tinto PLC.