SIA PTNNT

P T NewmontNusa Tenggara

F I N A L

SOCIAL IMPACTSOCIAL IMPACTASSESSMENTASSESSMENT

BATU HIJAU PROJECTBATU HIJAU PROJECTSUMBAWA, INDONESIASUMBAWA, INDONESIA

J U L Y 2 0 1 0

FINAL

SOCIAL IMPACT ASSESSMENT

BATU HIJAU PROJECT Sumbawa, Indonesia

Prepared for:

PT Newmont Nusa Tenggara Sumbawa, Indonesia

Prepared by:

AMEC Geomatrix, Inc. 639 Helena Avenue, Suite 1A Helena, Montana USA 59601

July 2010

TABLE OF CONTENTS

EXECUTIVE SUMMARY ................................................................................................................ I

1.0 INTRODUCTION.................................................................................................................. 1

Project Description ........................................................................................................................ 4 1.1.1 PT Newmont Nusa Tenggara ........................................................................................................................ 4 1.1.2 Existing Mine Description ............................................................................................................................... 5 1.1.3 Project Permitting ............................................................................................................................................. 7

2.0 CORPORATE PHILOSOPHY AND INSTITUTIONAL FRAMEWORK .......................... 8

2.1 Newmont Global Management System .......................................................................... 9

2.2 Social License to Operate ................................................................................................. 9

2.3 Social Responsibility Policy ............................................................................................... 9

2.4 Global Compact ............................................................................................................... 10

2.5 International Council on Mining Metals ......................................................................... 10

2.6 Extractive Industries Transparency Initiative ............................................................... 11

2.7 Millennium Development Goals ..................................................................................... 11

2.8 IFC Performance Standards ........................................................................................... 11

2.9 Indonesian Transmigration Policy ................................................................................. 13

2.10 Female Employment Policy ............................................................................................ 13

2.11 Integration of Corporate Philosophy and Institutional Framework in Project .......... 14

3.0 APPROACH TO SOCIAL IMPACT ANALYSIS ............................................................... 15

3.1 Scope of Work for the SIA ............................................................................................. 15 3.1.1 Purpose .............................................................................................................................................................. 15 3.1.2 Rationale ............................................................................................................................................................ 15 3.1.3 Scope .................................................................................................................................................................. 15 3.1.4 Standard ............................................................................................................................................................. 16

4.0 AVAILABLE DATA SOURCES .......................................................................................... 17

4.1 Primary Sources of Information ..................................................................................... 17 4.1.1 The 1996 AMDAL / Technical Report ....................................................................................................... 17

Population and Demographics ............................................................................................................. 17 Economic Activity ................................................................................................................................... 18 Infrastructure ........................................................................................................................................... 19

4.1.2 The 2008 Poverty Mapping Questionnaire Data .................................................................................... 20 4.1.3 The 2009 Focus Group Discussions .......................................................................................................... 20

4.2 Secondary Sources of Information ................................................................................. 21

4.3 Preliminary Data Gap Analysis ...................................................................................... 22

4.4 Preliminary Impacts Identified ....................................................................................... 22

4.5 The Batu Hijau Community Development Program ................................................... 23

5.0 CONTEXT AND BASELINE INFORMATION ................................................................. 33

5.1 Overview and Demographic Profile of Indonesia ......................................................... 33 5.1.1 General Overview ........................................................................................................................................... 33 5.1.2 Demographic Profile ....................................................................................................................................... 33 5.1.3 Macro Socio-Economic and Political Setting ............................................................................................ 35

Historical and Political Settings ........................................................................................................... 35 National Politics ...................................................................................................................................... 36 Local Governance ................................................................................................................................... 36 Economy .................................................................................................................................................... 37

5.2 Nusa Tenggara Barat Province ...................................................................................... 38

5.3 Kabupaten Sumbawa Barat (West Sumbawa District) ................................................ 39

5.4 Batu Hijau Study Area .................................................................................................... 39 5.4.1 Population and Ethnicity ................................................................................................................................ 40 5.4.2 Community Cultural Background ............................................................................................................... 41 5.4.3 Religion and Culture ....................................................................................................................................... 41 5.4.4 Education ........................................................................................................................................................... 42 5.4.5 Health ................................................................................................................................................................. 43 5.4.6 Safety and Security .......................................................................................................................................... 45 5.4.7 Infrastructure.................................................................................................................................................... 45

Roads .......................................................................................................................................................... 45 Sea Port ..................................................................................................................................................... 46 Power Plant and Electricity .................................................................................................................. 46 Water ......................................................................................................................................................... 47 Other Infrastructure Projects .............................................................................................................. 47

5.4.8 Workforce ........................................................................................................................................................ 47 5.4.9 Local Business Initiative ................................................................................................................................. 52 5.4.10 Sources of Livelihood ..................................................................................................................................... 53 5.4.11 Land Utilization ................................................................................................................................................ 53 5.4.12 Farming .............................................................................................................................................................. 54 5.4.13 Animal Husbandry ........................................................................................................................................... 55 5.4.14 Fisheries ............................................................................................................................................................. 55 5.4.15 Handicraft and Home Industry .................................................................................................................... 56 5.4.16 Forest and Forest Products .......................................................................................................................... 56 5.4.17 Market and Commercial Centers ............................................................................................................... 56 5.4.18 Banking and Credit Institutions ................................................................................................................... 57 5.4.19 Tourism ............................................................................................................................................................. 57 5.4.20 Family Income .................................................................................................................................................. 57 5.4.21 PTNNT Contributions to the Government ............................................................................................ 59 5.4.22 Community Profiles in the Study Area ...................................................................................................... 60 5.4.23 Stakeholder Meetings ..................................................................................................................................... 78

6.0 ANALYSIS OF SOCIAL IMPACT ...................................................................................... 79

6.1 Population and Demographic Shift ................................................................................ 80

6.2 Change in Economic Environment ................................................................................ 83 6.2.1 Employment and Labor .................................................................................................................................. 83 6.2.2 Other Economic Opportunities .................................................................................................................. 84 6.2.3 Family Income .................................................................................................................................................. 85 6.2.4 Tax and Royalty Generation ........................................................................................................................ 87

6.3 Natural Resource Management ..................................................................................... 89

6.4 Adequacy of Social Infrastructure and Services ........................................................... 90 6.4.1 Education ........................................................................................................................................................... 90 6.4.1 Health and Medical Facilities ........................................................................................................................ 92 6.4.2 Community Health Programs ...................................................................................................................... 93 6.4.3 Water and Sanitation ..................................................................................................................................... 94 6.4.4 Electricity and Energy ..................................................................................................................................... 94 6.4.5 Transport and Communications ................................................................................................................. 94 6.4.6 Safety and Security .......................................................................................................................................... 94

6.5 Vulnerable Groups .......................................................................................................... 95

6.6 Cultural Property ............................................................................................................ 96

6.7 Social Conflict .................................................................................................................. 96

6.8 Changes in Lifestyle and Culture ................................................................................... 98

6.9 Gender Equity .................................................................................................................. 99

6.10 Closure and Reclamation ................................................................................................ 99

7.0 SOCIAL MANAGEMENT PLAN ..................................................................................... 101

7.1 PTNNT Planning Documents Reviewed ..................................................................... 102 7.1.1 Community Development Program Strategic Plan (2009-2013) ...................................................... 103

7.2 Social Impacts Mitigation Approach ............................................................................ 104

7.3 Mitigation Funding ......................................................................................................... 110

7.4 Mitigation Team Organization ..................................................................................... 110

8.0 REFERENCES .................................................................................................................... 112 TABLES: Table ES.1 - Population Summary of Communities in the Study Area (1994 and 2008) ............................................... ii Table ES.2 - Monthly Income (2008) ......................................................................................................................................... vii Table ES.3 - Summary of Potential Impacts and Mitigation Measures ............................................................................ xiii Table 1.1 - PTNNT Company Profile ........................................................................................................................................ 4 Table 1.2 - Mineral Inventory PTNNT (December 2008) ................................................................................................... 7 Table 4.1 - 1994 Population Distribution by Village in Jereweh District ........................................................................ 17 Table 4.2 - Number of Inhabitants by Sources of Drinking Water in Jereweh District ............................................. 19 Table 4.3 - Partners Involved in the PTNNT Community Development Programs ................................................... 27 Table 4.4 - Community Development (ComDev) Investments, 1998-2009 ................................................................. 29 Table 5.1 - Social and Demographic Characteristics of the Indonesian Population (2009 Estimates) .................... 35 Table 5.2 - Summary of Indonesian Economic Indicators (2008 Estimate) .................................................................... 37 Table 5.3 - Regional Coverage, Population, and Population Density in the Kabupaten Sumbawa Barat (2004) ... 40 Table 5.4 - Regional Coverage, Population, and Population Density in the Kabupaten Sumbawa Barat (2007) ... 41 Table 5.5 - Comparison of Education Facilities Around the Batu Hijau Mine, Before (1995) and Since Operations (2002, 2003 and 2004) .......................................................................................................................................... 42 Table 5.6 - Numbers of Schools, Students and Primary School Teachers* (2007) ..................................................... 43 Table 5.7 - Number of Junior High Schools, Students and Teachers* (2007) ............................................................... 43

Table 5.8 - Number of Senior High Schools, Students and Teachers * (2007) ............................................................ 43 Table 5.9 - Total Health Facilities Around the PTNNT Area (2007) .............................................................................. 44 Table 5.10 - Total Jereweh, Maluk and Sekongkang Puskesmas Workforce (2007) ................................................... 44 Table 5.11 - Ten Most Common Diseases Suffered by the Population (2004-2006) .................................................. 45 Table 5.12 - Lighting Sources in Respondent Homes in the Villages Surrounding PTNNT (2003-2006) .............. 48 Table 5.13 - West Sumbawa District Population 15 Years of Age and Over by Type of Activity to Previous Week (2007) .................................................................................................................................................................................. 49 Table 5.14 - West Sumbawa District Population 15 Years and Above by Education Level and Sex (2007)......... 49 Table 5.15 - Percentage of Overseas Workers by Completed Education (2007) ....................................................... 49 Table 5.16 - PTNNT Employees by Area of Origin (Quarter 3, 2005) .......................................................................... 50 Table 5.17 - PTNNT Contractor Employees by Area of Origin (Quarter 3, 2005) ................................................... 50 Table 5.18 - PTNNT Employees by Area of Origin (December 2008) .......................................................................... 51 Table 5.19 - Land Spread by Sub-District and Utilization in Kabupaten Sumbawa Barat (2007) ............................. 54 Table 5.20 - Development of Farming Equipment Owned by Farmers Around the PTNNT Mine Area (2003 and 2004) ........................................................................................................................................................................................ 54 Table 5.21 - Total Domestic Animals Owned in the Villages Surrounding the PTNNT mine (2002, 2003 and 2007) ................................................................................................................................................................................................ 55 Table 5.22 - Number of Boats / Fishing Equipment Owned by Jereweh Sub-District Fishermen (2002-2007) ... 56 Table 5.23 - Available Economic Infrastructure in Villages Around the Mine (2004) ................................................. 56 Table 5.24 - Hotel Infrastructure Around the PTNNT Mine ............................................................................................ 57 Table 5.25 - Indonesian Government Financial Benefits from PTNNT (1997 – 2007) .............................................. 59 Table 5.26 - Indirect Financial Benefits from PTNNT (1997 Q2 - 2005) ....................................................................... 60 Table 6.1 - Population Summary of Communities in the Study Area (1994 and 2008) .............................................. 82 Table 6.2 - Monthly Income (2008) .......................................................................................................................................... 86 Table 6.3 - Comparison of Public Education Facilities (1995 and 2007) ......................................................................... 90 Table 6.4 - Ten Most Common Diseases Suffered by the Population (2004-2006) .................................................... 92 Table 7.1 - Summary of Potential Impacts and Mitigation Measures ............................................................................. 105 FIGURES: Figure ES-1 - Historic Population Growth (1994 and 2008) Figure ES-2 - Historic Household Income (1995 - 2007) Figure ES-3 – Study Area Communities: Percent Below Poverty Level (2008) Figure 1 - General Location Map Figure 2 - Study Area Communities Figure 3 - Mine Site Features Map Figure 4 - Historic Community Development Funding (2000 - 2008) Figure 5 - Historic Donation Funding (2000 - 2009) Figure 6 - Regional Administrative Districts Figure 7 - Historic Household Income (1995 - 2007) Figure 8 - Historic Population Growth (1994 and 2008) Figure 9 - Study Area Communities: Percent Below Poverty Level (2008) Figure 10 - Historic Number of Scholarship Recipients (1998 - 2009) APPENDICES: Appendix A - Newmont Asia Pacific Social Responsibility Policy and Updated Draft Social Responsibility

Standards Appendix B - Procedure to Employ Women Workers Appendix C - Stakeholder Meeting Summary Appendix D - PTNNT Donation Policy Appendix E - Community Development (ComDev) Investments, District and Community 2000-2009

FOREWORD AMEC Geomatrix social impact assessment team members conducted a site visit of the Batu Hijau Project area from 11 – 27 August 2009. The following AMEC Geomatrix representatives participated in the site visit: Karen Lyncoln, Senior Social Scientist Richard Leferink, Project Economist The site visit focused primarily on historic (1994) and recent (2008) social and economic conditions of the study area for the purposes of conducting a social impact assessment. AMEC Geomatrix would like to take this opportunity to thank PTNNT personnel for their generous cooperation, hospitality and review comments which were incorporated into this final social impact assessment document.

Social Impact Assessment Batu Hijau Mine

PT Newmont Nusa Tenggara July 2010 i

EXECUTIVE SUMMARY

This report presents the outcome of a Social Impact Assessment (SIA) of the Batu Hijau Copper-Gold Project (the Project), an existing mine operated by PT Newmont Nusa Tenggara (PTNNT) in the southwest region of the island of Sumbawa, Indonesia. The current Project is located in the Kabupaten Sumbawa Barat (West Sumbawa District), Sumbawa Regency, Nusa Tenggara Barat (NTB) Province. Such an assessment was determined necessary by PTNNT to update existing human environment information, satisfy internal Newmont guidelines, and address Newmont’s stated commitment to implement international best practices at its facilities across the world. The SIA process is an effective and useful tool that provides key socio-economic, socio-cultural, and socio-environmental data. PTNNT prepared an Integrated Environmental Impact Assessment (called the AMDAL) for the Project in October 1996 (PTNNT 1996) prior to construction. The human resources sections initially relied upon by the AMDAL were updated in this SIA study as the environmental and human environment has changed since 1996, either directly by actual construction and operation of the mine or indirectly by other factors (i.e. Government of Indonesia Transmigration Program). This SIA meets the requirements of the 2006 International Finance Corporation (IFC) Performance Standards, the Equator Principles, the Millennium Development Goals and Newmont Asia Pacific Social Responsibility Policy and Standards. The SIA incorporates the social baseline information as available in 1994 with data developed during the PTNNT 2008 poverty mapping exercise by updating the baseline data and including the transmigration relocation communities. The SIA extends the temporal boundary of its impact analysis to 2015. PTNNT intends to make this SIA a “living document” that embodies past efforts and provides both an overview of lessons learned as well as a forward-looking perspective. The document will be revised in the future to account for additional changes to the socioeconomic conditions of the “Study Area”. In 1990, PTNNT discovered a large porphyry copper deposit, which contains small amounts of gold and silver and the Batu Hijau Project commenced in 1996. The US$1.8 billion construction project was completed in 1999, and PTNNT began full operations in March 2000 with an initial life of mine (LOM) estimated to be more than 30 years. Mining at the Batu Hijau pit is expected to continue throughout the period 2010-2022 until achievement of the final mining limit with an expected total of 1.39 billion tons of ore being mined, with an average grade of 0.49 percent for Cu and 0.34 (grams per ton - g/t) for Au. The pit will be developed radially in all directions to reach a pit diameter of between 2.4 and 3.1 km, and maximum depth at an elevation of approximately 420 m below sea level. By 2008, the Batu Hijau pit had completed the fourth mining phase with a total 678.77 million tons of mined ore and 1.28 billion tons of waste rock removed. All mining of Batu Hijau pit ore will be completed by 2022 and processing of ore from the stockpile will continue until 2027. Production scheduling and tonnage mined is based on the mining plan drawn at the end of 2008. PTNNT developed a Mine Closure Plan (PTNNT 2009) that addresses the short-, medium- and the long-term development needs in the area. The Project and its ancillary facilities cover three sub-districts, as follows:

Maluk Sub-District hosts supporting infrastructure (power plant, dock, concentrate store, warehouse, fuel tanks, etc.)

Sekongkang Sub-District houses accommodations and offices, mining, ore processing plant and mine and process infrastructure.


PT Newmont Nusa Tenggara July 2010 ii

Jereweh Sub-District hosts mine and processing infrastructure.

The assessment is organized as “issues-based” impacts, which were identified through examination of available documentation and using findings from field work conducted at the Project site, including Focus Groups Discussions with local interest groups and key stakeholders (includes local authorities and relevant organizations). CONCLUSIONS AND RECOMMENDATIONS The following conclusions and recommendations are summarized below and are presented in their entirety in Section 6 - Analysis of Social Impact and Section 7 – Social Management Plan. Key issues that emerged through the social impact assessment analysis are the following:

Population and Demographic Shift, Change in Economic Environment, Natural Resource Management, Adequacy of Social Infrastructure and Services, Vulnerable Groups, Cultural Property, Social Conflict, Changes in Lifestyle and Culture, Gender Equity, and, Closure and Rehabilitation.

Each of these key issues, conclusions and recommendations are summarized below: Population and Demographic Shift The communities in the Study Area have grown dramatically since the construction of the Project (Table ES.1). It is important to note that of the approximately 28,000 people living in the Study Area in 2008 (Figure ES-1), almost 10 percent of them live in communities developed by the Government of Indonesia as transmigration communities and have little to no relationship to the Project. Another 10 percent of the population lives in Buin Batu, the townsite PTNNT created for employee housing and administrative services. Table ES.1 - Population Summary of Communities in the Study Area (1994 and 2008)

Sub-district/Community

1994 Population

AMDAL

2008 Population

PTNNT Maluk Sub-district 124 - 200 9,148 - 10,341 Benete (1) 1,556 Mantun and Maluk Loka 124 - 200 3,837 - 3,893 Mantun -- 1,893 - 2,009 Maluk Loka -- 1,828 - 2,000 Bukit Damai (1) 1,863 - 3,000 Pasir Putih (1) 1,892 Sekongkang Sub-district 2,078 9,676 - 10,118 Sekongkang Atas 1,642 1,799 - 2,373 Sekongkang Bawah 436 901 - 1,135 Ai’ Kangkung (2) 912 - 1,014 Tongo (1) 1,270 Tatar (2) 623 Talonang Baru (2) 937 Buin Batu -- 3,000


PT Newmont Nusa Tenggara July 2010 iii

Sub-district/Community

1994 Population

AMDAL

2008 Population

PTNNT Jereweh Sub-district 7,216 7,709 Goa 2,478 1,389 Dasan Anyar (3) 1,251 Belo 2,546 2,148 Beru 2,192 2,921 Study Area 9,418 - 9,494 26,533 - 28,168

Source: (Dames & Moore 1995, PTNNT 2008 Poverty Mapping Data and Appendix C) Notes: (1) - No historical population information available. (2) - Transmigration village in development in 1994 or after 1994 - no historic population data available. (3) - Was included in the population of Goa in 1994. While population growth based on employment was substantial during Project construction and initial start-up operations, PTNNT does not anticipate any major changes to its workforce during the next five years. By assuming that the annual growth rate will remain constant at the ‘natural increase rate’ of 1.5 percent per year, it is estimated that the population of the Study Area will reach 30,000 persons by 2015. Natural increase is the number of births minus the number of deaths in each community. Since this growth is estimated to reflect natural increase, no impact on the adequacy of housing or community infrastructure/services is anticipated. It is estimated that the Study Area population will decrease sharply when mine operation ceases. Many families drawn to the area by mining opportunities will return to their place of origin or move to another mine or activity. The Indonesian government may decide to relocate other people to the area but that is beyond the scope of this analysis. PTNNT should monitor population growth during the next five years in order to evaluate this impact and determine whether the Company needs to have some input into the process, particularly with transmigration.

Change in Economic Environment Prior to mine construction and operation, the Batu Hijau Study Area was predominantly an agrarian area with about 74 percent of the entire labor force working in agricultural and related activities. The population working in commerce and services formed about 15 percent and 4 percent of the labor force respectively. The main economic activities in the Study Area included farming (crops and animal production), small-scale industrial activities, and commerce. The most immediate benefit associated with the development of the Project was employment creation, both at the national and local level. Jobs were created both directly and indirectly and each salary had a multiplier effect on the individuals, family members and within the broader community. PTNNT Human Resources Department adopted a local employment policy which aimed to give hiring preference to individuals based on their residential proximity to the Project. In 2008, the Project employed 4,150 people. Of these, 2,652 employees (64 percent) lived within the NTB Province and 1,498 reported they lived outside the Province. In April 2009, PTNNT recorded 258 vendors and suppliers were registered as living in the sub-districts of Jereweh, Maluk, Sekongkang, Taliwang, Brang Rea, Brang Ene, Seteluk and Tano. Of these, 78 were actively working for PTNNT. Active contractors employed 2,809 unskilled, semi-skilled and skill people in 2005. Of these, 1,873 were from within the NTB Province, and 936 were outside the Province. In 2009, approximately 1.5 percent (64 people) of PTNNT employees were expatriates. This overall decrease in expatriate presence at the site has created a significant number of high level jobs for Indonesian professionals and has improved the skill base for all of Indonesian mining. PTNNT has also adopted the policy governing the employment of women which requires certain conditions to be met regarding their employment (see also Section 6 - Gender Equity).

Historic Population GrowthPT Newmont Nusa Tenggara

Sumbawa, IndonesiaFIGURE ES-1

Low Range Population Growth Estimate (1994 and 2008)

High Range Population Growth Estimate (1994 and 2008)

Source: Dames & Moore 1995, PTNNT 2008 Poverty Mapping Data and Appendix C

0

2,000

4,000

6,000

8,000

10,000

12,000

1994 2008

Jereweh Sub-district

Sekongkang Sub-district

Maluk Sub-district

0

2,000

4,000

6,000

8,000

10,000

12,000

1994 2008



Maluk Sub-district


PT Newmont Nusa Tenggara July 2010 v

PTNNT does not anticipate any significant changes to its workforce and employment would remain relatively stable throughout the duration of its operations. However, in the absence of additional mine expansion, it is anticipated the work force will be reduced at the conclusion of mining in the years approaching 2022 as the Project moves into reclamation and closure. The PTNNT Purchasing and Contracts Department has developed a program called the “Local Business Initiative” or the LBI, which uses a similar contractor categorization based on their proximity to the Project. In addition, the Department, through the LBI, works with local contractors through training to improve business management and entrepreneurship, guidance on taxes, access to capital, construction and human resource management, and access to a PTNNT-sponsored Business Center facility. In April 2009, PTNNT recorded 258 vendors and suppliers were registered as “Local-Local” (suppliers registered in the sub-districts of Jereweh, Maluk, Sekongkang, Taliwang, Brang Rea, Brang Ene, Seteluk and Tano). Of these, 78 were actively working for PTNNT. Active contractors employed 2,809 unskilled, semi-skilled and skill people in 2005. Of these, 1,873 were from within the NTB Province and 936 were outside the Province. The Project created other indirect economic opportunities, not attributed to the LBI. Based on a survey of 350 households, it was reported that, other than the agricultural sector at 41.1 percent and 6.6 percent relying on fishing, approximately 12.6 percent of the heads of households worked primarily in the service industry, 8.9 percent in trade, 5.7 percent in handicraft, 12.9 percent as private sector workers (including mining), and 12 percent as government employees (PPLH Unram 2006). It is unknown how many new businesses have sprung up on Lombok and other locations in the NTB which are not part of the LBI. The increase in air traffic at Mataram’s Selagarang Airport has benefited local communities. In addition, businesses have been established at the ferry depot on the east coast of Lombok to service the number of employees and their families who live in that area. Family income levels before mine operations showed that approximately 83 percent of respondents reported a monthly income below US$22 (approx Rp.200,000) and 44 percent reported less than US$11 (approx Rp.100,000). Since mine operations, the average recorded family income was approximately US$149 (approx Rp.1,340,000) and in 2005 to 2006 average was US$254 (approx Rp.2,283,000)(Figure ES-2). Table ES.2 summarizes the monthly household income figures reported in the 2008 Poverty Mapping questionnaire. Communities adjacent to the mining activities have the highest incomes. Those communities that are still primarily dependent on agriculture have the lowest monthly family incomes. Indirect economic opportunities have also been created by the Project, including local markets trading in supplies and services have also grown in the Study Area. According to the World Bank Group (WBG) study in 2009: “Despite impressive macro-economic growth rates over the past several years, poverty remains high in Indonesia with 36 million people or 16.7 percent below the national poverty line (US$1.55/day) and almost half the population (49 percent) below US$2/day (2007)” (WBG 2009). The poverty lines expressed in US dollars by the WBG roughly equate to the first column of Table ES.2. In 2008 rupiah, US$1.55 to US$2.00 per day would equal approximately Rp.420,000 to Rp.540,000 per month or an average of Rp.480,000 per month.

Historic Houshold IncomePT Newmont Nusa Tenggara


Respondent Monthly Income in villages around the mine (IDR)

Respondent Monthly Income in the villages around the mine (US$)

Source: PPLH Unram, 2008

155369

10228351064980

1097306

1340161 1489000

1966000

2283000

2972000

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

1995 2000 2001 2002 2003 2004 2005 2006 2007

67.3

113.6118.3

121.9

157.7165.4

218.4

253.7

330.3

0

50

100

150

200

250

300

350

1995 2000 2001 2002 2003 2004 2005 2006 2007


PT Newmont Nusa Tenggara July 2010 vii

Table ES.2 - Monthly Income (2008)

District Community

Percentage of Respondents Earning Less Than

US$55 (Rp.500,000)

Between US$55-167

(Rp.500,000-1,500,000)

Between US$167-389

(Rp.1,500,000-3,500,000)

Greater Than US$389

(Rp.3,500,000) Maluk Sub-district Mantun Maluk Bukit Damai Benete Pasir Putah

12% 18% 5% 2% 17%

29% 40% 50% 36% 35%

22% 22% 38% 35% 25%

30% 26% 7% 27% 22%

Sekongkang Sub-district Sekongkang Bawah Sekongkang Atas Ai’ Kangkung Tongo Tatar Talonang Baru

17% 16% 55% 33% 55% 64%

47% 40% 24% 39% 36% 35%

20% 28% 11% 15% 9% 1%

16% 17% 9% 13% 0% 0%

Jereweh Sub-district Goa Dasan Anyar Belo Beru

42% 34% 39% 32%

26% 38% 36% 38%

17% 17% 19% 14%

15% 11% 13% 9%

Source: PTNNT 2008 Poverty Mapping Data With the exceptions of Mantun, Bukit Damai and Benete in the Maluk sub-district and Sekongkang Atas in the Sekongkang sub-district, the remaining Study Area communities reported incomes below the national poverty line (listed as monthly incomes Rp.500,000 or less) than in the nation as a whole (16.7 percent). And like general monthly income levels, poverty is more prevalent the further away the community is from the mine. Communities who have families with members working directly or indirectly for the mine have the lowest percentage of families living below the poverty line; communities that rely on agricultural income have the highest percentage of families living below the poverty line. The transmigration communities, Ai’ Kangkung, Tatar, and Talonang Baru have the highest percentages of families living below the poverty line (Figure ES-3). PTNNT provides community assistance in the form of revolving funds and several skill training schemes implemented by two foundations supported by PTNNT, namely, Yayasan Olat Parigi (YOP) and Yayasan Pembangunan Ekonomi Sumbawa Barat (YPESB). The presence of the Project in the Sekongkang Sub-district has significantly increased the district’s revenue through payment of royalties and taxes. Total tax and non-tax payments to the various entities within the government of Indonesia was over US$468.3 million (approx Rp.4.2 trillion) in 2008 alone. Royalties paid the government in 2008 was almost US$12.7 million (approx Rp.114.3 billion). In the absence of Project expansion, tax and non-tax revenues paid by the Project to the government of Indonesia will cease at the conclusion of mining in 2022. It is possible that government funding levels to the District, sub-districts and Study Area communities will also decrease. It is not clear how much funding is provided to Study Area communities as a result of PTNNT tax and royalty payment to the Government.

Sekongkang Bawah

Maluk Loka

Beru

JerewehSub-District

SekongkangSub-District

MalukSub-District

(64%)

(55%)

(33%)

(55%)

(17%)

(16%)

(18%)

(2%)

(17%)

(5%)

(39%)

(32%)

(42%)

(34%)

Goa

Belo

Bukit DamaiPasir

Dasan

Tongo

Benete

Tatar / SP-2

Talonang / SP-3

Sekongkang Atas

Aik Kangkung / SP-1

(35%)

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Percent Below Poverty Level (2008)PT Newmont Nusa Tenggara


I N D I A N O C E A N

B A L I S E A

L o m b o k S u m b a w a

CommunitiesAdministrative Sub-DistrictsPercentage of 2008 RespondentsWith Monthly Income Less ThanUS$55 (Rp.500,000)

Batu Hijau Project

Batu HijauProject Area


PT Newmont Nusa Tenggara July 2010 ix

At the conclusion of mining in 2022 and in the absence of mine expansion, the economies of Study Area communities will likely contract. Remaining economic opportunities will include those that were present before the Project such as collecting and utilizing forest products. In addition, other industries which PTNNT are advancing with communities include higher productivity farming, enhanced business management stills, aquaculture and recreation and tourism. It is hoped by PTNNT assistance with establishing and fostering these activities will enhance livelihoods currently and following the conclusion of the Project. Natural Resource Management The Batu Hijau Project is located in a government-designated protection forest that had been degraded to a greater or lesser degree by logging and encroachment of agriculture. PTNNT has recently renewed its forest use permit (called a pinjam pakai), which ensures that PTNNT will continue to mine until 2022. No impacts to natural resource management or access to forest land impacts have been experienced or are expected due the Batu Hijau Project. There is sufficient farm land off the mountain, and PTNNT has developed irrigation systems and educational programs to enhance crop yields. Several environmental concerns have the potential to affect the people living in the Study Area. The first is the long-term impact of the submarine tailings disposal on the marine fishery and the long-term impact of mining on the quality and quantity of groundwater and river water that may be used by residents of communities in the Study Area for bathing, washing, and drinking. PTNNT regularly monitors surface and subsurface water quality. All waters currently meet monitoring parameters for health and safety of adjacent users. In addition, the community development investments in water and sanitation facilities have reduced the use of river water for bathing, washing, and drinking significantly. Adequacy of Social Infrastructure and Services The Community Development (ComDev) community investment program has made great strides at improving infrastructure and facilities throughout the Study Area both in terms of direct inputs such as new facilities and equipment and processes such as training. PTNNT has increased the number of schools in the Jereweh, Sekongkang and Maluk sub-districts. In 2007, there were 2,987 student in primary school; 834 students in junior high; and 339 students in senior high in the Study Area. These figures do not include the number of students in the Madrasah Ibtidaiyah, Tsanawiyah, and Aliyah Islamic schools. The rapid development of educational facilities in the past 10 years has provided considerable opportunities for the people around the mine to achieve education and continue on to higher education close to their own homes. Other assistance has been provided by PTNNT in the form of school library and journal development in 24 schools. PTNNT also provides educational supports, including scholarships for high-performing students and education assistance for economically-challenged students. Prior to 1997, NTB Province was widely recognized as having some of the most unsatisfactory public and environmental health and social indicators of the Indonesian provinces (GOI-UNICEP 2000). PTNNT has built or renovated health care facilities (puskesmas) and integrated health services stations (posyandu) in each of the Study Area sub-districts of Jereweh, Maluk and Sekongkang. PTNNT has also made donations of medical equipment and provided training for 169 community health monitoring agents and 197 community health personnel.


PT Newmont Nusa Tenggara July 2010 x

PTNNT is partnered with International SOS (ISOS) and together they have contributed to the Public Health and Malaria Control Program. The program covers 27,604 inhabitants within the Study Area. The purpose of this program is to promote awareness, monitor and analyze public health conditions, particularly Malaria, TB and HIV/STIs in the Project area (ISOS 2008). Specifically the goals of the program include:

Prevent epidemics and spread of disease, Enhance disease knowledge and behavior, Respond to public health crisis and assist in recovery, Conduct health surveillance and diagnosis, Diagnose and investigate health problems and conduct health risk assessments, Provide information, education and awareness of health issues, Create policies and plans as needed to support public health, Enforce laws and regulations the protect public health and safety, Link those who need health care with heath care service, Ensure heath care workers are available to employees, and, Evaluate the effectiveness, accessibility and quality of staff and community based health

centers.

According to PTNNT Community Health Program statistics, cases of malaria in the Study Area have dropped significantly from 47 percent of the population contracting the condition in 1999 to 0.62 percent in 2008 (PTNNT 2009g). Prostitution has become more common in the Maluk area primarily because of the number of single men who work at the mine in the area. While prostitution is noted by local residents, no particular problems have arisen, save the public image of sex workers, the sex trade and the Islamic prohibitions to the practice. Internationally, mine areas are often a catalyst for increased prostitution activity. Nusa Tenggara Barat Dalam Angka 2009 reports that of the 220 HIV/AIDS cases reported in the province in 2008, half of them were in Kota Mataram and another 10 percent were in Sumbawa Barat (22 cases). Health risks related to HIV/AIDS and other sexually transmitted diseases (STDs) are communicated to mine employees and people living in the surrounding communities through a process of education, case detection and treatment strategies. ISOS has a specific monitoring and evaluation program and reports its findings to PTNNT, the district and provincial governments regularly. PTNNT has developed and made available water and sanitation services in ten Study Area communities serving more than 10,000 people. By 2006, almost all villages surrounding the mine had a domestic light source with the exception of Ai’ Kangkung and Tatar villages. Prior to mine development and operation, roads in the Study Area were quite primitive. By 2008, PTNNT had facilitated the development and improvement of up to 400 km of roads in the study area (PTNNT 2009 and 2009b) via ComDel projects. In addition to improved road connections between the communities in the Study Area, the Batu Hijau mine has dramatically improved transportation to Sumbawa via the Travira Air sea plane service between Denpasar and Mataram to Benete and the ferry service from Benete to Lombok. Study Area communities within the Maluk Police Sector rely upon the Police headquarters in Maluk for security services. In 2008, there were 89 cases reported; 63 cases had been reported for 2009 through August of that year. In general, the types of crimes reported are minor petty theft and verbal assaults.


PT Newmont Nusa Tenggara July 2010 xi

Vulnerable Groups In 2008, PTNNT administered a Poverty Mapping Questionnaire to identify the number and location of poor people within the Study Area in order to develop mitigation measures. In general, the transmigration communities of Ai’ Kangkung, Tatar, and Talonang Baru Village are considered to be the most likely places to see financially vulnerable residents because:

These residents were relocated by the Indonesian government and may not have strong local family or religious ties to others in the Study Area;

Community members at these locations are more physically isolated that other residents

(especially residents of Talonang Baru Village); and, These residents are the least likely to be employed by PTNNT or one of its contractors.

Residents of these three communities have incomes which are primarily from agriculture and are therefore lower than residents of other communities (Table ES.2). International experience is that the dominant risks of involuntary resettlement (such as that seen in the transmigration communities) are landlessness, joblessness, homelessness, economic setback, increased morbidity and mortality, food insecurity/malnutrition, social disorganization, and loss of common property. Several risks are often realized simultaneously - for example, loss of land, employment, home, in a deteriorating social structure. Fortunately, this has not been the case with the communities in the Study Area. Most transmigration families lived in the same community before they moved and received up to two hectares of land as a condition of their relocation. Most residents enjoy family/community support, and non-Muslims appear to be well-integrated into the communities. Cultural Property In many developing countries, sacred sites and cemeteries are important in terms of their linkage with the authority of the ancestors, which contributes to the ideology of affected households and communities. This is not the case in Indonesia as 99 percent of the residents of the Study Area are Muslim and do not hold these beliefs about heritage resources. Social Conflict Social systems and structures in the Study Area have been able to respond to the changing social environment. The influx of new residents as result of the Project has had both positive and negative impacts. On the negative side, the Project increased pressure on existing social infrastructure such as available accommodations, educational and health facilities, and water and sanitation facilities. An additional negative impact has been an increase is social vices such as crime, prostitution, drugs and violence. Criminal activities and prostitution is recognized as an unavoidable consequence of mining, which, aside from the health implications, tends to create conflict between spouses, sometimes with breakdowns in marriage and disruption of families and children. Representatives of the Focus Group Discussion noted that people seem to be shifting their values from social solidarity to a more individualistic, materialistic way of life (Appendix C). On the positive side, a population influx has brought some diversity to the Study Area and facilitated an expanded world-view that local people, most of whom rarely travel, would otherwise not access. PPLH Unram 2006 noted that local residents were apparently adopting many of the newcomers’ behaviours, especially relating to increased productivity.


PT Newmont Nusa Tenggara July 2010 xii

Other impacts identified include increased conflict within and between households and communities, often expressed as jealousy about the increased financial status of PTNNT and PTNNT contractor employees. PTNNT is aware of the jealousy issue and has implemented a program which assists 75 non-employee families in each community to rehabilitate and update their housing. To date, 75 houses have been completed in Tongo. There has also been some conflict between locals and ‘outsiders’ from other parts of Indonesia and between local and expatriates. The employment of ‘outsiders’ initially caused conflict with local residents because many local residents believed that jobs should have been awarded to them. PTNNT adopted a local employment policy which aims to give hiring preferences to individuals based on their residential proximity to the Project. To prevent any conflict and misunderstanding, the Company has embarked on a sensitization process to educate the communities about its job requirements and defray their thoughts from unrealistic negative impacts. The same social conflict issues are apparent on Lombok where many of the Batu Hijau workers live with their families when they are not working. Batu Hijau miners work a 4-day shift and live at company housing during their tour if they do not live in the Study Area communities. They then return to their homes on Lombok when they are not working. Shift work can be disruptive to family life and lead to stress. During the focus group discussions, several residents indicated dissatisfaction with how ComRel deals with local concerns and/or implements local ideas. It is understood that, open and ongoing communication between PTNNT and community representatives can foster an awareness of changes, conflict and promote reasonable expectations. At the same time, developing long-term planning synergies between the Company and the sub-district officials are also vital. Changes in Lifestyle and Culture The lifestyles of the residents of the Study Area have changed dramatically since the construction and operation of the mine. The area has changed from an agrarian (traditional) lifestyle to one based on industry and cash money. PPLH Unram 2007 reports that residents have become more open and cosmopolitan in their lifestyle, expressed by a more varied diet and a change in their spending priorities. Consumer spending has shifted from being primarily related to housing, food, and clothing to education and investment. Accumulation of prestigious goods such as motor bikes has increased and people are investing in their children’s future through education and starting businesses. PPLH Unram 2006 notes that local residents continue to practice traditional ceremonies and rituals such as marriage ceremonies and rites of passage although they may now have a more modern implementation. PTNNT has respected the predominantly Muslim culture of the residents of the Study Area. In addition to its modified work practices, described below, the Company has constructed mosques and madrasahas as part of its community development investments. All Company/community interactions are organized to respect Muslim holidays and cultural expectations. For example, PTNNT restructures its work assignments to accommodate Ramadan during which Muslims take no food or water from sunup to sundown. Output is reduced and workers have special safety discussions during this time. Workers are allowed time for prayer twice a day (between 15-30 minutes each) and on Fridays they receive an additional hour at noon after which most devout Muslims leave for the weekend. According to Halal dietary guidelines, no pork or pork product has been served in any PTNNT facility since 2001/2002 (private living quarters excepted).


PT Newmont Nusa Tenggara July 2010 xiii

Gender Equity The SIA examined gender issues to ensure that women, who are often more economically vulnerable than men, are not ignored in assessing both the impacts of developments and the plans to implement programs as part of PTNNT’s broader social responsibility. PTNNT has not discriminated in its hiring practices based on gender, and job opportunities provided by the Company have been equally available to both male and female applicants, provided they are suitably qualified. Residents recognize that most mine-related jobs have gone to men. Women are employed in certain jobs in accordance with Indonesian law and common practice, which restrict the ability of many women to work at night. Most women employees work in the administrative and support fields where they can work during the day light hours. To date, there has been little to no community dissatisfaction with this arrangement as it conforms to existing community standards; no additional impacts are expected to 2015. Closure and Rehabilitation Examples around the world suggest that many communities are worse off after mine closure, primarily because development programs end after mine closure; social infrastructure sometimes deteriorates and opportunities for health and education are often reduced. Poverty levels generally increase in a post-mining environment because mining salaries and the levels of service delivery collapse as the revenue and other forms of support from the mine cease. PTNNT has drafted a Mine Closure Plan which delineates the disposition of facilities, infrastructure and equipment. For example, buildings and office facilities, mess hall, and accommodation and recreation facilities in the Buin Batu townsite will be retained for use by the local community. Repairs and maintenance of the infrastructure during the first five years following mine closure will be the responsibility of PTNNT. At the end of that five year period, local communities will assume responsibility for repairs and maintenance of the remaining infrastructure. The Mine Closure Plan identifies potential impacts that will likely occur following completion of mining activities, including a phased cessation of employment between PTNNT and its employees. Additionally, mine closure can also potentially end several community development programs. PTNNT is developing an approach to prepare for the community to become economically independent and not rely on assistance from the Company. An essential element of the mitigation strategy is a philosophy to ensure that at mine closure the local institutions can effectively manage the social infrastructure using a partnership approach between the Project, government and other relevant stakeholders to ensure long-term and sustainable management. Table ES.3 summarizes the potential impacts identified, proposed mitigation measures, any additional action that may be required and the PTNNT responsible department. The majority of impacts identified will be mitigated by the continuation of existing PTNNT programs, primarily developed and implanted by the External Relations Department. These include programs include the Community Development Program and the Community Relations Program. Table ES.3 - Summary of Potential Impacts and Mitigation Measures

Potential Impacts of Batu Hijau Mine

PTNNT Mitigation Measures

PTNNT Actions Required

PTNNT Responsible Department

Population and Demographic Shift Natural population increase can be accommodated.

None required by PTNNT None required by PTNNT Not Applicable

Population will contract as the Project approaches closure and reclamation.

None required by PTNNT None required by PTNNT Not Applicable


PT Newmont Nusa Tenggara July 2010 xiv





Change in Economic Environment Need for Indonesian job creation and retention in accordance with the CoW.

Continue with strategy to replace expatriates as qualified Indonesian candidates as they become available.

Continue employment strategy

Mine Management Human Resources Department

Need for contracted services will begin to diminish as the Project approaches closure and reclamation.

Diversify suppliers, vendors and local communities to promote other economic opportunities.

Continue to work with Local Business Initiative partners and seek new opportunities to diversify.

Community Relations Community Development Contracts and Purchasing Department Mine Closure Group

Direct and indirect employment will be reduced as Project approaches closure and reclamation.

Tax and royalty payments to the government will reduce as Project approaches closure and reclamation.

Identify current amounts of local funding derived from Government based on PTNNT mining activities. Identify alternative funding sources for programs and services.

Research alternative funding schemes. May include concepts such as enhanced property ownership documentation.

Governmental Relations

PTNNT programs to provide services and foster economic development may become unfunded as the Project approaches closure and reclamation.

Identify alternative funding sources for programs and services.

Research alternative funding schemes.

Community Development Mine Closure Group

Natural Resource Management Government may change existing or apply additional regulatory constraints to the Project. PTNNT may make changes to the mine plan requiring additional regulatory review.

Continue External Relations program to ensure the government stays informed about the Project and its benefits.

Continue External Relations program.

Government Relations

Adequacy of Social Infrastructure and Services PTNNT financial support for education and health programs will reduce as Project approaches closure and reclamation.

Identify alternative funding sources for programs and services. May include PTNNT bonds or other financial commitments from PTNNT, the government or others.

Research alternative sources of funding.


Financial support for maintenance of existing infrastructure as required for farming and water delivery will reduce as Project approaches closure and reclamation.


PT Newmont Nusa Tenggara July 2010 xv





Project closure and decommissioning may bring additional opportunities (i.e.: for local power generation and sales revenue).

Identify alternative funding sources for programs and services that may use additional elements resulting from mine closure.

Continue to incorporate transitional activities into Mine Closure Plan and Community Relations Strategic Plan.

Community Development Mine Closure Group Technical Service Department Power Plant Department

Vulnerable Groups Transmigration communities may need continued assistance.

Continue to include officials of the transmigration communities in the community relations program to identify future problems.

Continue community relations program.

Community Relations Community Development

Future relocation of additional Muslim and non-Muslim transmigrants by the Government of Indonesia.

Continue to work with Indonesian government.

None required by PTNNT Government Relations

Cultural Property No PTNNT impacts identified None required by PTNNT None required by PTNNT Not Applicable Social Conflict Jealousy of PTNNT employees. Continue to rehabilitate non-

employee housing Continue community relations program.


Continue to make infrastructure investments which benefit all residents.

Outsiders coming for employment.

Continue to sensitize local residents regarding job availability and requirements.


Community Relations

Continue to sensitize employees to local culture and expectations.

Jealousy of transmigrants for receiving land.

No action available to PTNNT to respond to a government program.

None required by PTNNT Not Applicable

Increase in crime including prostitution.

Monitor crime statistics and work with local law enforcement.

Develop a partnership with local law enforcement.

Safeguards and Security

Lack of communication with local residents.

Improved communications with community residents.

Continue and strengthen community relations interactions with communities by holding community meetings each month.

Government Relations Community Relations Community Development

Consider improved staffing of PTNNT community offices through better coordination or merge of community relations and community development.

Changes in Lifestyles and Culture No PTNNT impacts identified None required by PTNNT None required by PTNNT Not Applicable


PT Newmont Nusa Tenggara July 2010 xvi





Gender Equity No PTNNT impacts identified None required by PTNNT None required by PTNNT Not Applicable Closure and Rehabilitation Post mining land use and settlements.

As listed in the Mine Closure Plan (PTNNT 2009).

Regular updates of Mine Closure Plan.

Mine Closure Group Technical Service Department Environmental Department

Maintaining sustainable development and infrastructure programs.

Community Development Plan based on health, education, community welfare and suitable infrastructure.

Regular updates and success evaluation of Community Development Plan.

Community Development

Reduced employment and economic opportunities.

Community Development Plan which focuses on a partnership approach between PTNNT, government and other relevant stakeholders.

Continue to research sustainable development activities for communities.

Government Relations Mine Closure Group


PT Newmont Nusa Tenggara July 2010 1

1.0 INTRODUCTION

This report presents the outcome of a Social Impact Assessment (SIA) of the Batu Hijau Copper-Gold Project (the Project), an existing mine operated by PT Newmont Nusa Tenggara (PTNNT) in the southwest region of the island of Sumbawa, Indonesia (Figure 1). The current Project is located in the Kabupaten Sumbawa Barat (KSB) (West Sumbawa District), Sumbawa Regency, Nusa Tenggara Barat (NTB) Province (Figure 2). Such an assessment was determined necessary by PTNNT to update existing human environment information, satisfy internal Newmont guidelines, and address Newmont’s stated commitment to implement international best practices at its facilities across the world. The SIA process is an effective and useful tool that provides key socio-economic, socio-cultural, and socio-environmental data. International standards of environmental assessment stipulate that SIAs are necessary to understand the potential implications of a mining project on its surrounding natural and social environment. As a keystone of the Indonesian permitting process, PTNNT prepared an Integrated Environmental Impact Assessment (EIA) for the Project in October 1996 (PTNNT 1996). The EIA was prepared as part of an overall impact identification process, referred to as Analisis Mengenai Dampak Lingkungan (AMDAL). The human resources sections within the AMDAL were based upon a technical report prepared by Dames & Moore (1995). These reports required updating because the environmental and human environment has changed. Some of the changes are directly influenced by actual construction and operation of the mine while other changes occurred due to other factors (i.e. government relocation of villages). Changes to the human environment prompted completion of this SIA. One of the primary changes that occurred at the Project site since issuance of the 1996 AMDAL was construction of the village of Tatar; the relocation of this village was still being planned by the Indonesian Transmigration Program (Transmigrasi) in 1996. Now Tatar (originally referred to as SP-2) is a thriving community in which PTNNT is running multiple community development programs including infrastructure projects such as a land irrigation system, home rehabilitation, and construction of a school, clinic and community center. No formal documentation has been completed relative to quantifying the number of residents, households, occupations, or education levels in Tatar. In addition, at the time of the 1996 AMDAL, PTNNT lacked current basic demographic information on other communities in the “Area of Influence” around the Project (Study Area), particularly for the communities of Sumbawa and Lombok, which house significant numbers of company employees and their families. A major challenge of completing this SIA was securing baseline information that will serve the present and future planning processes of PTNNT relative to meeting the needs of stakeholders, authorities and communities. No social baseline information and data were available to monitor and evaluate trends or in planning future programs. In addition, no formally written Social Management Plans were available for any of the communities proximal to the Project site. Such information and plans will be used extensively in the future, particularly as closure planning matures. PTNNT intends to make this SIA a ‘living document’ that embodies past efforts and provides both an overview of lessons learned as well as a forward-looking perspective. The document will be revised in the future to account for additional changes to the socioeconomic conditions of the “Area of Influence.” It is also intended that this SIA recount PTNNT’s efforts since 1996 with regard to its investments in social programs and social and environmental responsibility, both internationally as well as locally.


I N D I A N O C E A NI N D I A N O C E A N

I N D O N E S I AJ A V A S E A

MalaysiaMalaysia

C E L E B E S S E A

T I M O R S E A

A F A U R A S E A

H:\N

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0 40Kilometers General Location MapPT Newmont Nusa Tenggara

Sumbawa, IndonesiaFIGURE 1

Lombok

Sumbawa



B a l i S e a

I n d i a n O c e a n

Approximate Mine Pit Location

Amat

TanjungMangkun

SekongkangTeluk


MadasangerTanjung Senunu

Teluk

SenutukTeluk

Teluk Maluk

Labulawah

Tanjung

Tanjung

BeneteTeluk

JelengahTanjung

Teluk Puna

Sekongkang Bawah

Maluk Loka

Beru

JerewehSub-District


MalukSub-District

Goa

Belo

Bukit DamaiPasir

Dasan

Tongo

Benete

Tatar / SP-2

Talonang / SP-3

Sekongkang Atas

Aik Kangkung / SP-1

H:\N

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0 6Kilometers Study Area CommunitiesPT Newmont Nusa Tenggara



B A L I S E A


CommunitiesAdministrative Sub-Districts



Project Description

In 1990, PTNNT discovered a large porphyry copper deposit, which contains small amounts of gold and silver. Following detailed technical and environmental studies and government approval, the Batu Hijau Project commenced in 1996. The US$1.8 billion Project was completed in 1999 and PTNNT began full operations in March 2000 with an initial life of mine (LOM) estimated to be more than 30 years.

1.1.1 PT Newmont Nusa Tenggara

PT Newmont Nusa Tenggara (PTNNT), a Foreign Capital company or Penanaman Modal Asing (PMA) registered in Indonesia, constructed its Batu Hijau open pit copper and gold mine (the Project) in 1996. Initially, PTNNT was jointly owned by Nusa Tenggara Mining Corporation (an affiliate of Sumitomo Corporation) (43.75 percent) and by Newmont Indonesia Limited (a subsidiary of Newmont Mining Corporation) (56.25 percent). Table 1.1 summarizes information germane to the profile of the Company. Table 1.1 - PTNNT Company Profile

Company name PT Newmont Nusa Tenggara (PTNNT) Type of legal entity Limited Company Address Jl. Sriwijaya 258, Mataram 83126,

Provinsi Nusa Tenggara Barat Telephone number 0372-635318 Facsimile number 0372-635319 Capital Status Foreign Capital Company Board of Directors 1. Martiono Hadianto (President Director)

2. Brian Hill 3. Rio Ogawa 4. Rudy Merukh 5. James Osterkamp

In accordance with the Contract of Work (CoW) provisions and as part of an arbitration panel decision, Newmont and Sumitomo have completed the sale of 17 percent of their combined shareholding to PT Multi Daerah Bersaing, a private Indonesian company appointed by the Regional Governments. The sale consists of a 3 percent interest in PT Newmont Nusa Tenggara as part of the divestiture obligation in 2006, 7 percent as part of the divestiture obligation in 2007 and also an additional 7 percent interest as part of the 2008 divestiture obligation. The 2009 divestiture of 7 percent was made to PT Multi Daerah Bersaing and PT Multicapital, a private company.

As a result of the divestitures, Newmont's economic ownership in Batu Hijau has been reduced from 52.44 percent to 48.50 percent, which includes a 17 percent effective economic interest obtained as collateral for a loan transaction with PT Pukuafu Indah, as well as Newmont's direct holding of 31.5 percent.

An operating agreement among Newmont, PTNNT, and PT Multi Daerah Bersaing came into effect with the closing of the 2009 divestiture obligation. Under this agreement, Newmont and Sumitomo continue to retain, so long as their combined shareholding is greater than PT Multi Daerah Bersaing's interest in PTNNT, the right to apply Newmont's operational, technical, financial, and related standards and practices to the operation and management of Batu Hijau. The operating agreement continues for as long as the Nusa Tenggara Partnership holds more shares in PTNNT than does PT Multi Daerah Bersaing.



Under the CoW, an additional, and final, 7 percent of PTNNT will be offered for sale by March 31, 2010, after which the divestiture obligations will have been met. Newmont notes that pursuant to this provision, the ownership interest in the Batu Hijau Project may be reduced to as low as 27.56 percent and the ownership interest of the Nusa Tenggara Partnership in PTNNT could be reduced to 49 percent. The operating agreement could terminate at this stage, with the result that Newmont could lose effective control over the operations of Batu Hijau.

1.1.2 Existing Mine Description

The Batu Hijau Project is located on the southwest side of the island of Sumbawa, in the Kabupaten Sumbawa Barat (KSB) (also called the West Sumbawa District) in the Province of Nusa Tenggara Batat (NTB). The Project and its ancillary facilities cover three sub-districts in the KSB, as follows:

Maluk Sub-District – hosts supporting infrastructure (power plant, dock, concentrate store, warehouse, fuel tanks, etc.)

Sekongkang Sub-District – houses accommodations and offices, mining, ore processing plant and mine and process infrastructure.

Jereweh Sub-District – hosts mine and processing infrastructure.

Accessibility to Batu Hijau from Jakarta is by airplane to Mataram, the capital of NTB situated on western Lombok, and from the Selaparang airport, at Mataram, by seaplane or helicopter to the Benete Port - a 20 to 25 minute journey. An alternative route consists of overland travel from Mataram to the Kayangan port, a trip of 90 to 120 minutes, followed by a ferry crossing of 60 to 90 minutes to the Port of Benete. The Batu Hijau mine pit is located 25 kilometers (km) from the Port of Benete and reachable by road in approximately 45 minutes. PTNNT activities and mine areas as developed in 2009 and as forecasted through 2015 are depicted on Figure 3. According to the current Mine Closure Plan (PTNNT 2009), Batu Hijau is an open pit mine 450 meters (m) above sea level. The mine produces copper concentrate containing minor amounts of gold and silver. The concentrate is sent overseas to smelters for further processing. Batu Hijau operates a conventional open cut mining system using trucks and shovels as the prime equipment to transfer rock. The mining sequence of activities involves stripping overburden and seal rock, drilling and blasting, and transport and transfer. The rock mined is transferred to several different locations according to its classification. Ore is transported directly to the crusher or stockpiled in the ore stockpiles of Sejorong and East dumps; waste rock is transported to the Tongoloka waste rock disposal facility (Figure 3). Throughout the life of mine (LOM) a total of 1.39 billion tons of ore will be mined from the Batu Hijau pit, with an average grade of 0.49 percent for Cu and 0.34 (grams per ton - g/t) for Au. Ore stockpiled in the Sejorong and East dumps is sent to the crusher when there is no ore coming directly from the mine and also at times when directly mined ore needs to be mixed to maximize crushing or processing capacity. Mining is completed in phases, or pushbacks, aimed at maximizing mining operations. Mine phases are made radially in relation to each other with a minimum distance between phases of approximately 100 m. By 2008, the Batu Hijau pit had completed the fourth mining phase with a total 678.77 million tons of mined ore and 1.28 billion tons of waste rock removed. Total mineral inventory (see Table 1.2) at the Batu Hijau mining location at the end of 2008 was 1,046 million tons of ore classified in categories of measured, indicated, and inferred mineral resources. The total reserve and resources fluctuates based on metal sale prices (copper, gold and silver) and other technical aspects (geotechnical and geological characteristics).

Amat

TanjungMangkun

SekongkangTeluk


MadasangerTanjung Senunu

Teluk

SenutukTeluk

Teluk Maluk

Labulawah

Tanjung

Tanjung

BeneteTeluk

TOWNSITE

SANTONGSEJORONG

EAST

PIT

TONGOLOKA

TONGOLOKA

DUMPDUMP

DUMP

SEA WATERINTAKESEJORONG

SEJORONG

TONGO

SEKONGKANG SEKONGKANGBAWAH ATAS

CONCENTRATOR

BUIN BATU

BENETE

BENETE

MALUK

PORT

AIK KANGKUNG/SP-1

TATAR/SP-2

BELO

BERU

GOA

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B A L I S E A


Communities

Primary Access Road

Main Road

Rivers and Streams

Barrow and Use Permit Boundary

Pit Area (Year 2015)

Dump Area (Year 2015)



Table 1.2 - Mineral Inventory PTNNT (December 2008) Type Unit Total

Ore Million tons 1,046

Content:

Cu – Copper

Au – Gold

Ag – Silver

%

g/t

g/t

0.40

0.27

0.93

Cu – Copper Million pounds 9,106

Au – Gold Thousand ounces 9,197

Ag – Silver Thousand ounces 31,325

Note: Includes Stockpile ore 265 Million ton @ 0.34 % Cu, 0.11 gpt Au, 0.52 gpt Ag.

Mining at the Batu Hijau pit is expected to continue throughout the period 2010-2022 until achievement of the final mining limit. The pit will be developed radially in all directions to reach a pit diameter of between 2.4 and 3.1 km, and maximum depth at an elevation of approximately 420 m below sea level. The pit is shaped in benches with single benches 15 m high and in some places 30 m high with inter ramp angles varying between 35-55 degrees and catch berms varying between 8-22 m. The complete development of the Batu Hijau pit will disturb an area of approximately 549.8 hectares (ha). During the 2011-2016 mining period, almost no ore will be mined from the pit as a consequence of the lateness in developing the subsequent mining phase, caused by the delay in issuance of the borrow and use or pinjam pakai permit extension. During that period, ore from the Sejorong and East Dump stockpiles shall become the prime source of material to fill the needs of the process plant. Ore from the subsequent phase shall start being stripped and sent to the processing plant in 2017 and shall continue until the end of pit mining operations in 2022. All mining of Batu Hijau pit ore is expected to be completed by 2022. Processing of ore from the stockpile will continue until 2027. Mine closure will commence in 2028 with a five year program – some civil work activities for three years followed by a two year maintenance period. A unique feature of the Batu Hijau Project is the system designed to store tailings from the processing plant. This system is referred to as Submarine Tailing Placement (STP). The STP system was designed to easily and safely transport material onto the floor of the Senunu sea canyon near the Tongo villages. The STP system has been designed to reduce contact between solid or liquid tailings and the coastal or surface water habitat. The tailings pipe base is placed at a water depth of 106 m. The tailings pipeline itself is 6.1 km long overland to the Senunu Bay. A pipeline choke station reduces the pressure in the pipeline utilizing four 6 m chokes and four 2 m chokes. Beyond the choke station, the pipeline is routed underground and reappears under the sea surface.

1.1.3 Project Permitting

PTNNT prepared an Integrated Environmental Impact Assessment (EIA) for the Project in October 1996 (PTNNT 1996), as part of an overall impact identification process, referred to as Analisis Mengenai Dampak Lingkungan (AMDAL). PTNNT and the Indonesian Government signed the Contract of Work (CoW) on 2 December 1986. The current Contract Area of 87,540 ha comprises 5 blocks located on the island of Sumbawa, as per Minister of Energy and Mineral Resources Decree No. 398.K/40.00/DJG/2005 dated 10 October 2005.



In addition to the deposit at Batu Hijau, PTNNT also holds rights to Elang, a highly prospective porphyry copper and gold deposit located 60 kilometers east of Batu Hijau, and Rinti, an area with significant exploration potential located another 20 kilometers east of Elang, both on the island of Sumbawa. PTNNT’s CoW Operating Period is effective for 30 years as of 1 March 2000 with the commencement of the Batu Hijau Mine operation, as per Director General of General Mining Decree No.148.K/20.01/DJP/2000, dated 28 April 2000. As of 2008, the Batu Hijau Project had entered its eighth full calendar year of production. In addition to the CoW, the Project also relies upon a “borrow and use” permit called ijin pinjam pakai. Pursuant to a letter from the Minister for Forestry and Plantations No. 405/Menhutbun-VII/1999 (dated 30 April 1999) to PTNNT regarding utilization of a Forest Mining Area, the Department of Forestry and Plantations agreed in principle to the usage of a Limited Production Forest (Hutan ProduksiTerbatas or known as HPT) and Protected Forest (Hutan Lindung or knows as HL) in the KSB, NTB, (an area of approximately 1,006 ha) to be used to construct water control drains, to stockpile topsoil, and as additional areas to support the Batu Hijau Project (Figure 3). A revised pinjam pakai agreement was signed between the Minister for Agriculture and Forestry and PTNNT on 5 April 2000 and was to be effective for a period of 20 years. This agreement extended the permitted area from an initial 5,149.98 ha in the previous agreement to 6,417.295 ha. The additional area of 1,267.31 ha was to be allocated as a water overflow control area, stockpiling area, and support area for the Project. The forest area or “Pinjam Pakai” is located in the Kelompok Hutan Pucuk Ngenges Selalu Legini, RTK 22, District of Sumbawa (the merging of Kelompok Hutan Pucuk Ngenges RTK 72 with Kelompok Hutan Selalu Legini RTK 59) comprising 948.71 ha of protected forest, 5,305.7153 ha of production forest and 162.87 ha of limited production forest. The revised agreement area was designated pursuant to a decree by the Minister of Forestry and Plantations No. 405/Menhutbun-VII/1999 of 30 April 1999 regarding usage of additional forest. The revised agreement replaced the old agreement (dated 12 August 1997), thus invalidating the previous agreement. In 2005, the Minister of Forestry and Plantations declared forests in the Project area as protected effectively prohibiting PTNNT from clearing additional forest land for mining purposes. PTNNT, the Department of Energy and Mineral Resources (DEMR), and the Forestry Department had been in discussions to renew its Pinjam Pakai permit until September 2009. The permit was renewed in 2009 and was made retroactively effective from 2005 through 2025. This permit renewal had taken longer than anticipated and, consequently, the delay has adversely impacted the efficient operation and financial results of the facility. In the interim period before the permit was received, PTNNT had already made the decision to keep employment at Batu Hijau at current levels and to utilize existing employees in other ways. The delay has resulted in the idling of some mine equipment and the need to re-task mine employees. The recent issuance of this permit was a key requirement to restore efficient operation of the Batu Hijau Mine.

2.0 CORPORATE PHILOSOPHY AND INSTITUTIONAL FRAMEWORK

The Batu Hijau Project is part of Newmont’s Asia Pacific (APAC) group of facilities and operations. As a subsidiary of Newmont Mining Corporation (hereafter ‘Newmont’), the mine operates in accordance with all Newmont standards and commitments as outlined below.



2.1 Newmont Global Management System

Newmont uses a Global Management System that it developed and administers to ensure compliance with international statutory and regulatory requirements. This system promotes greater performance and continual improvement in the areas of environmental and social responsibility, and health, safety and loss prevention for all its operating sites around the world. The value of this system is that it provides the foundation for achieving outstanding performance by establishing a culture of continual improvement based on plan development, execution, monitoring and timely response to correct actions that are off course. The Global Management System also provides consistency by providing a basis for development of systematic and institutionalized processes of management. Specific to this document, the Global Management System requires that any Newmont SIA be reviewed and updated every five years during the operations phase of the Project. Newmont’s stated vision is to be the most valued and respected mining company through industry-leading performance. In pursuit of this vision, Newmont seeks to demonstrate leadership in safety, stewardship of the environment, and social responsibility. This section outlines the Company’s commitment to the highest standards of community impact management.

2.2 Social License to Operate

Gaining a Social License to Operate has recently emerged as a critical success factor in mine development. It fundamentally changes the manner in which mining companies do business. A social license is earned by acquiring free, prior and informed consent from indigenous peoples, and local communities (Salim 2003). Newmont is committed to this process and a positive impact on the communities in which it operates. Newmont gauges its Social License to Operate based on the acceptance and belief by society and, specifically, the local communities in which Newmont operates, in the value creation of the Company’s activities. In doing so, the Company aims to create a mutually respected relationship around its mines and conduct its business through sound and responsible methods. One of the principle challenges is to achieve an appropriate balance between economic growth, environmental protection and social development.

2.3 Social Responsibility Policy

In August 2009, Newmont’s Asia Pacific (APAC) division formally adopted a social responsibility policy (Appendix A). Newmont has also developed and formally adopted a set of accompanying Community and External Relations (CER) standards on the following global risk areas:

Management of Sites with Cultural or Religious Significance (NEM-CER-S.020) Management of Heritage Sites (NEM-CER-S.021) Land Access and Acquisition (NEM-CER-S.022) Local Community Investment (NEM-CER-S.024) Indigenous Employment and Business Support (NEM-CER-S.025) Media Relations (NEM-CER-S.027) Staff and Contractor Behavior (NEM-CER-S.029) Government Relations (NEM-CER-S.031) Social Impact Assessments (NEM-CER-S.032) Human Rights Awareness (NEM-CER-S.033) Local Employment and Business Support (NEM-CER-S.034) Security Forces Management (NEM-CER-S.035) Closure (NEM-CER-S.036) Resettlement and/or Displacement of Peoples (NEM-CER-S.037)



Newmont adopted new and revised standards to guide its future global operations in December 2009. These updated Social Responsibility (SR) standards are also presented in their entirety in Appendix A. These new standards are listed below:

Social Baseline Studies (NEM-SR-S.01) Social Impact Assessment (NEM-SR-S.02) Stakeholder Mapping (NEM-SR-S.03) External Stakeholder Engagement (NEM-SR-S.04) Expectation and Commitment Management (NEM-SR-S.05) Complaint / Grievance Management and Resolution (NEM-SR-S.06) Monitoring and Evaluation (NEM-SR-S.07) Local Community Investment (NEM-SR-S.08) Security and Human Rights (NEM-SR-S.09) Land Access, Acquisition and Resettlement (NEM-SR-S.10) Management of Cultural and Heritage Sites (NEM-SR-S.11)

2.4 Global Compact

Newmont’s commitment to socially responsible corporate citizenship is manifested in its subscription to the Global Compact, an international initiative led by the Secretary General of the United Nations, to support the creation of a sustainable and inclusive global economy. The Global Compact brings together companies, United Nations’ agencies, labor and civil society in support of ten universal principles regarding human rights, labor, environment, and anti-corruption (see www.globalcompact.org). These ten principles are: Human Rights

Businesses should support and respect the protection of internationally proclaimed human rights; and,

Make sure that they are not complicit in human rights abuses.

Labor Businesses should uphold the freedom of association and the effective recognition of the

right to collective bargaining; The elimination of all forms of forced and compulsory labor; The effective abolition of child labor; and, The elimination of discrimination in respect of employment and occupation.

Environment Businesses are asked to support a precautionary approach to environmental challenges; Undertake initiatives to promote greater environmental responsibility; and, Encourage the development and diffusion of environmentally friendly technologies.

Anti-Corruption Businesses should work against corruption in all its forms, including extortion and bribery.

2.5 International Council on Mining Metals

The International Council on Mining and Metals (ICMM) was founded in October 2001 to represent leading international mining and metals companies (ICMM 2003). Newmont is a founding member. Newmont is also a signatory to the ICMM’s Sustainable Development Framework, which was an outgrowth from the Global Mining Initiative’s 2002 Breaking New Ground report. The principles underlying the Framework are:



Implement and maintain ethical business practices and sound systems of corporate governance;

Integrate sustainable development considerations within the corporate decision-making process;

Uphold fundamental human rights and respect cultures, customs and values in dealings with employees and others who are affected by mining activities;

Implement risk management strategies based on valid data and sound science; Seek continual improvement of environmental performance; Contribute to conservation of biodiversity and integrated approaches to land use planning; Contribute to the social, economic and institutional development of affected communities;

and, Implement effective and transparent engagement, communication, and independently verified

reporting arrangements with stakeholders.

2.6 Extractive Industries Transparency Initiative

The Extractive Industries Transparency Initiative (EITI) was launched in September 2002. The objective of this initiative is to increase transparency over revenues in the extractive sector in countries that are heavily dependent on these resources (EITI 2003). EITI is grounded in the shared belief that the potential to provide accurate information is the basis for sustainable economic growth and development. Newmont is a member of EITI.

2.7 Millennium Development Goals

Newmont subscribes to the Millennium Development Goals (MDG) established by the United Nations General Assembly in 2000 (UN 2009). The eight goals are:

Eradicate extreme poverty and hunger; Achieve universal primary education; Promote gender equality and empower women; Reduce child mortality; Improve maternal health; Combat HIV/AIDS, malaria and other diseases; Ensure environmental sustainability; and, Develop a global partnership for development.

These goals comprise a series of targets that all 195 United Nations member states have pledged to meet by 2015 (see www.un.org/millenniumgoals/). As a UN member state, Indonesia subscribes to the MDG. In turn, Newmont seeks to assist in implementing the country’s MDGs that are complementary to the Company’s social commitment. The Batu Hijau Project has been approved by the Indonesian government and is operating within the Indonesian legal and policy framework. Current activities are, and future activities will be, regulated and guided by these policies.

2.8 IFC Performance Standards

Because the International Finance Corporation (IFC 2006) social and environmental sustainability performance standards and guidelines are compatible with the Equator Principles (2006), these requirements are presented together. The IFC performance standards and guidelines are prescriptive in nature and provide specific expectations with regards to scope and methodologies. Key issues of the IFC/Equator Principles framework are:

Labor and working conditions; Biodiversity;



Pollution prevention and abatement; Indigenous peoples; Land acquisition and involuntary resettlement; Community health, safety and security; and, Cultural heritage.

In addition, the IFC applies Performance Standards to projects it finances. For the purposes of the Batu Hijau Project SIA, Performance Standard 1 - Social and Environmental Assessment and Management Systems, is applicable. This Performance Standard underscores the importance of managing social and environmental performance through the life of the project. The objectives of this standard are:

To identify and assess social and environment impacts, both adverse and beneficial, in a project’s area of influence;

To avoid, or where avoidance is not possible, to minimize, mitigate or compensate for adverse impacts on workers, affected communities, and the environment;

To ensure that affected communities are appropriately engaged on issues that could potentially affect them; and,

To promote improved social and environment performance of companies through the effective use of management systems.

Sections 19-23 of the Performance Standard 1 address standards for managing social and environmental risk and impacts through:

Community engagement (19) in which the proponent demonstrates that it has built and maintained a constructive relationship with affected communities.

Disclosure (20) in which the proponent provides project related information such as the EA that helps communities understand the risks, impacts and opportunities of the project.

Consultation (21) in which affected communities have an opportunity to express their views on and have constructive input into project risks, impact and mitigation measures.

Consultation on projects with significant adverse impacts (22) on affected communities must be done in a manner that ensures informed participation and that the communities’ views on mitigation measures, benefits and opportunities and implementation measures are incorporated.

Grievance procedure (23) is established to receive and facilitate resolution of affected communities’ concerns and grievances in a prompt and efficient manner that is also culturally appropriate, readily accessible to all segments of the affected communities, without cost or retribution and without prejudicing judicial or administrative actions.

The IFC/Equator Principles framework includes:

Consideration of third parties and implications; Consideration of supply chain and implications; Disclosure requirements; and, A focus on vulnerable populations.

In addition, the Principles state that an Environmental Assessment should address “participation of affected parties in the design, review and implementation of the project.” The IFC requires that its eight performance standards are met by its clients throughout the life of an IFC (or other affiliated financial institutions) investment. The aims of the eight performance standards are to manage social and environmental risks and impacts and to enhance development opportunities in its private sector financing for its member countries eligible for financing.



The Batu Hijau Project is a mature Project which has demonstrated its willingness to comply with Indonesian laws, regulations and permits applicable to the Project, even when difficult to achieve. The time required for Government permit review and the apparent lack of coordination on the part of the varied units of the Indonesian government to work effectively to review and issue such permits (see Section 1.1.3 - Project Permitting) has and will continue to impact exploration and operation at Batu Hijau. The Batu Hijau Project was initiated before the new IFC Performance Standards were promulgated but it meets the previous requirements (those in existence in 1996) with the exception of having an up to date Social and Environmental Baseline and Impact Assessment. The only EIS for the Project was written in 1996, and the surrounding area has grown dramatically since construction and operations. The Elang and Rinti Projects are not discussed in the existing EIS nor have any formal action plans been developed to guide programs.

2.9 Indonesian Transmigration Policy

An important Indonesian policy that affected the Project during the early days and continues to affect its mission is Indonesia's transmigration program (Transmigrasi), the world's largest resettlement project financed in part by the World Bank. The program was based on an earlier Dutch colonial policy that was reinstated during the Suharto regime. The program's goals were to alleviate population pressure on the islands of Java, Madura, and Bali while improving living standards and employment opportunities for the poor throughout the country. During the mid 1990s, two areas near the Batu Hijau Project were settled by transmigrants. A third area was settled after 2000. As noted in the Community Profiles (Section 5.5.21), other communities in the Study Area were settled by in-migrants during their histories, including:

Ai’ Kangkung (originally called SP-1) is a governmental transmigration community that developed in 1994 before the mining was approved. Residents came from Lombok and Bali and were granted two hectares of land per family for agricultural work. Fifty of the families are Hindus from Bali.

Tatar (originally called SP-2) is another transmigration village developed after 1994 and after mine construction was completed.

Talonang Baru Village (originally call SP-3) is a recently developed transmigration village, settled in 1995.

In August 2000, after the Asian financial crisis and the fall of the Suharto government, the Indonesian government officially cancelled the large-scale transmigration program due to a lack of funds. Under the restructured Department of Manpower and Transmigration (Departemen Tenaga Kerja dan Transmigrasi), the Indonesian government maintains the transmigration program, although on a far smaller scale than in previous decades, including the small resettlement of Talongang Baru Village (SP-3). These communities, while not settled for any Batu Hijau Project-related reason, have brought in new people who require jobs, services, and infrastructure, and who, because of some differences with the resident population, have the potential to create social disruptions. PTNNT has taken the lead in responding to the need for infrastructure and services in the various communities in the Study Area.

2.10 Female Employment Policy

Current Indonesian employment law has had a major impact on hiring practices at the Batu Hijau Mine. In March 1989, the then Minister of Manpower, issued No. Per.04/Men/1989 concerning the Procedure to Employ Women Workers for Nightwork (see Appendix B for full text of the regulation). The regulation requires:



Article 1: Any employer who employs women workers at night to make a formal written request binding in stamp tax to the local Head of Minister of Manpower Office (Kandepnaker), enclosed with:

Kind of business and nature of work of the company concerned; Reasons to employ women workers at night; and Statement letter indicating the employer’s ability to comply with the required obligations

(Article 3 of Staatsblad no. 647 year 1925). Article 2: the undertaking that employs women workers at night must comply with the following requirements:

Its type of business and the nature of work need continuous work; or A description of the need to achieve the production targets; or A description of the need to have better production quality when is performed by women

workers. Article 3: any employer who employs women at night shall give full protection on safety, health, and morality by complying with these requirements:

The women workers are not pregnant; The women workers are at least 18 years old or married; Employer provided transportation; Employer provided good nutritious meals and drinks; Employer to hold letters of permit from the husband, parents or guardian of the women

workers; and, Consider local customs.

In 2003, the Indonesia government codified its employment laws (Subsection 3, Article 76, Act No. 13, Year 2003), as presented in full in Appendix B. While the new act is not as specific as the above regulation, it does lay out some requirements for paid leave for women workers which have been included in the Collective Labor Agreement (1 January 2009 – 31 December 2010) and restates the following restrictions:

It is prohibited to employ female workers/laborers aged less than 18 (eighteen) years of age between 11 pm until 7 am.

Entrepreneurs are prohibited from employing pregnant female workers/laborers who, according to a doctor’s certificate, are at risk of damaging their health or harming their own safety or the safety of the baby that is in their womb, if they work between 11 pm and 7 am.

Entrepreneurs who employ female workers/laborers to work between 11 pm until 7 am are under an obligation:

o To provide them with nutritious food and drinks; and, o To maintain decency/ morality and security in the workplace. o To provide returned/ roundtrip transport for female workers/laborers who work

between 11 pm until 5 am.

2.11 Integration of Corporate Philosophy and Institutional Framework in Project

Third party assessments of PTNNT’s progress towards gaining and maintaining its Social License to Operate in Indonesia have been favorable. The Company was commended by the Five Star Team in 2006 for its proactive stakeholder engagement activities, capacity building, infrastructure development, donations, local hiring and procurement policies, and initiatives for health and safety (Five Star 2006).



The Batu Hijau Project directly impacts people living near the Project and indirectly impacts those in the wider constituency, including the sub-district, district, province and national levels. Consistent with Newmont’s overall corporate philosophy, the Company has undertaken to:

Ensure fair and consistent recruitment practices, including recruitment of local skilled and unskilled labor to the greatest degree possible;

Improve the welfare of mine affected communities, including levels of health, education and infrastructure;

Operate on the basis of equal opportunity, regardless of race, gender, creed, color or religious orientation;

Provide compensation that results in minimal disruption to the community and supports re-establishment of lost livelihoods; and,

Undertake properly administered land transactions defined in consultation with stakeholders.

These efforts are discussed in more detail throughout this document.

3.0 APPROACH TO SOCIAL IMPACT ANALYSIS

The approach taken to complete this Social Impact Assessment (SIA) involved completion of four general tasks:

Review Newmont’s Global Management System; Review previous surveys and studies completed in the Study Area; Review Batu Hijau Community Development Program in view of mining and other activities

completed at the site since 1994; and, Conduct Focus Group Discussions for the purposes of data verification and issue

identification.

3.1 Scope of Work for the SIA

The aim of the SIA is to document the social impacts of PTNNT on residents within its Area of Influence (the Study Area) and to provide recommendations on responses to the issues raised in the SIA process. AMEC Geomatrix developed the SIA in accordance with the Newmont Standard for Social Impact Assessments (NEM-SR-S.02) adopted in February 2010, as presented below:

3.1.1 Purpose

To provide the minimum requirements for identifying and evaluating social impacts, both adverse and beneficial, related to a site’s area of influence, in order to provide an informed analysis upon which to develop and implement effective short- and long-term mitigation and development plans.

3.1.2 Rationale

By conducting thorough and timely social impact assessments, Newmont will be able to more accurately estimate site risks and address them in a timely and cost-effective manner. Impact assessments also allow Newmont to identify opportunities for sustainable contributions to support local socio-economic development and enhance the value of the site to the local community.

3.1.3 Scope

This standard is applicable to Newmont owned and managed operations and properties at all phases of the mine life cycle, including exploration, design, construction, operation and closure.



3.1.4 Standard


1. Impacts and risks to be assessed shall include, but are not limited to: Number of people, family structure, size of households; Community health and safety; Quality, availability and use of land, natural resources and raw materials (inclusive of

flora, fauna, ecosystems and biodiversity, soil, water, air, climate and landscape; Protected areas and sites of cultural, heritage, or religious; Local and regional infrastructure and civil support services; Heritage, recreation and amenity; and Livelihoods, lifestyle, human rights, and well being of affected communities.

2. An assessment of potential positive and negative impacts that the site may bring to local, regional, and national communities shall be undertaken.

3. Impacts shall be assessed against baseline information collected according to the Social Baseline Studies Standard. Where baseline data does not exist, is outdated, or considered incomplete or compromised, Newmont will undertake studies to provide a comprehensive suite of baseline information, scaled to the level of anticipated site activity, prior to undertaking the impact assessment.

4. For properties acquired by Newmont, a review against this standard will be conducted to determine whether an impact assessment is warranted, and if necessary, be completed within 12 months of acquisition.

5. Impacts shall be analyzed in the context of the site’s area of influence.

6. Impacts shall be considered in the context of the mine life cycle, to the extent that the life cycle can be anticipated and defined. The assessment shall be inclusive of both short- and long-term impacts as well as primary and secondary impacts and adverse and beneficial impacts.

7. Special attention will be paid to ensure that the needs of community members that may be disproportionately affected by site activities (e.g., socially vulnerable community groups or specific resource-dependant groups) are identified and addressed.

8. Social impact assessments shall be conducted: Prior to initiation of a project alternatives analysis; Updated after the preferred alternative is selected; Updated five years after commencement of operations (first ore to primary crusher)

and every five years thereafter during the operations phase of a site; and Updated three years prior to decommissioning (closure focus).

9. Impact assessments shall be conducted more frequently than defined above if deemed necessary based on the risks specific to the site, or where there has been significant change to the social context or site footprint.

10. Assessments shall be undertaken by independent subject matter experts with experience in impact assessment related to the mining industry.

11. Assessments shall include an analysis of technically and financially feasible alternatives to the identified source of impacts, and the rationale for selecting a single preferred alternative.

12. An assessment report shall be prepared and will comprise: Description of the local context/environment (baseline); Site description; Identification of potential adverse and beneficial impacts;



Evaluation of alternatives including the “no go” alternative; Consideration of cumulative impacts; Recommendations for mitigating and managing impacts; and Monitoring and review systems to evaluate the effectiveness of the impact

management plans.

13. External stakeholders will be consulted throughout the assessment process. In particular, the assessment process will include the participation of affected communities. Participation will be designed to ensure that the process is inclusive, accessible, free of external manipulation, and undertaken in a culturally appropriate manner.

14. Stakeholders shall be provided with opportunities to express their views on potential site risks, impacts, and mitigation measures. Stakeholder concerns shall be documented and addressed during the assessment process and within the assessment reports in an open and transparent manner.

The information will be presented as a series of “Community Profiles” (Section 5.5.21).

15. Final assessment reports shall be made publicly available and available to local communities in a culturally appropriate manner. A copy shall be provided to site, regional, and corporate managers.

4.0 AVAILABLE DATA SOURCES

4.1 Primary Sources of Information

4.1.1 The 1996 AMDAL / Technical Report

The Study Area for the 1996 Multisector / Integrated Environmental Impact Assessment (AMDAL) for the Batu Hijau Project (PTNNT 1996), based on the Technical Report for the Socio-Economic and Socio-Cultural Environment, prepared in 1994, was originally prepared for the three NTB Districts (kecamatans) of Jereweh, Taliwang and Seteluk (Dames & Moore 1995). By the time the information in the technical report was inserted into the AMDAL, the focus was primarily on Jereweh because the majority of the components of PTNNT's mining activities were to be located within its boundaries. The Jereweh District had a population of 8,894 in 1994 and a population density of just over 10 people per square kilometer.

Population and Demographics

In 1994, the Jereweh District consisted of five villages (desa) and 13 hamlets (dusun). The southern villages of Jereweh District, those nearest the proposed mining site, were described as being more isolated, less populous, and less developed than those in the north. Table 4.1 below, reprinted from the AMDAL, presents population figures for each of the villages in the District in 1994. Table 4.1 - 1994 Population Distribution by Village in Jereweh District

Village Total Men Women Density per sq km

Households Average Members

Goa 2,478 1,218 1,260 45 585 4

Beru 2,192 1,099 1,093 10 480 5

Belo 2,546 1,139 1,107 7 476 5

Sekongkang Atas 1,642 817 825 11 342 5



Village Total Men Women Density per sq km

Households Average Members

Sekongkang Bawah 436 222 214 3 98 4

Total 8,994 4,495 4,499 10 1,981 4.5

Source: Kecamatan Jereweh in Figures, 1994

The AMDAL reported that nearly all Sumbawans, including those in Jereweh District, were Moslems (99 percent), the remaining 1 percent were Catholic or Buddhist (1993 Statistics). Social activities predominantly related to religion and included weekly recitations of the Koran and Mosque youth activities, usually conducted at Mosques or prayer houses. Seasonal laborers also come from Lombok at harvest time (especially to Beru, Belo, and Goa villages) and returned after the harvest. Social relationships within migrant communities appeared to be complementary. Rare conflicts were often related to family, economic or job problems, and were typically solved with the help of community leaders and elders. In the villages closest to the mine site (Sejorong, Sekongkang, Tongo), many migrants from Lombok had settled and become non-landowner farmers or residing farm laborers. They commonly took jobs which the local inhabitants could not or would not do because they required certain skills. The fact that the Lombok language (Sasak) is closely related to the local language makes it possible for the migrants from Lombok to be accepted well, without significant conflict. Migrants from other regions are generally civil servants or private sector employees who are stationed in the area (Dames & Moore 1995).

Economic Activity

The AMDAL reported that economic activity in southwestern Sumbawa was dominated by agriculture, including crop farming and livestock. In 1992, the Districts of Jereweh and Seteluk had the smallest labor forces (4,593 and 9,465, respectively) in the Sumbawa Regency. The Taliwang District has the second largest (20,731). Of this labor force, the majority was absorbed by the agricultural sector (58 percent), while the trade sector employed 17 percent and the industrial sector accounted for only 0.7 percent. Other activities included forestry and forest products, fishing, and small informal industries. There were some trade facilities in the Jereweh District in 1994: a traditional market (in Beru); four shops (all in Beru), and a number of small-scale shops/restaurants (26 in Beru, 22 in Goa, 16 in Belo, 9 in Sekongkang Atas; and four in Sekongkang Bawah). The District market in Beru (essentially, the District capital) began operations in early 1994. The existence of the market allowed farmers to gain additional cash income by selling their surplus crops. Outside of Beru, there were no markets. Inhabitants living in the interior usually went to Taliwang to obtain goods to satisfy their household needs. The AMDAL noted that important industries in the Jereweh District were handicrafts, especially earthenware and food preparation for retail sale or in restaurants. Of existing business enterprises, the number of small, “informal sub-sector” industries, such as handicrafts and personal goods direct sale industries was much higher than formal industries which provided goods and services to larger enterprises. The informal industries also employed a greater proportion of the workforce. A lime kiln co-operative had been operating in Beru since the mid 1970s. The manufacture of rattan furniture for sale began in Maluk in 1995. There were virtually no tourism facilities in Kecamatan Jereweh in 1994. The AMDAL reported that the most significant tourism and recreational activity within the coastal area was surfing. The coastal exposure to the southwesterly oceanic swell makes Sumbawa attractive for surfers from overseas, particularly Australia, and also the United States, Europe and other parts of Asia. A number of charter boats visit the area from time to time, using Maluk as the main anchorage. There was a small



picnic area (pondok) near the beach at Maluk for use by tourists. The small rooms (losmen) at Maluk sometimes accommodated marine tourists; however, most slept on board the charter boats.

Infrastructure

In 1994, almost every village in the Jereweh District was located close to a stream. In addition to irrigating rice fields, river water was used for bathing, cleaning and washing, bathing cattle, fishing and also for means of transportation and transporting wood/forest products. For drinking water, some inhabitants used spring water or pumped water, while a large number of those living in the interior villages used river water as shown in Table 4.2 below, reprinted from the AMDAL. Table 4.2 - Number of Inhabitants by Sources of Drinking Water in Jereweh District

Village Spring Water

Pumped Water

Well Water

Total Water

Goa 44 163 378 585

Beru 83 314 83 480

Belo 62 249 165 476

Sekongkang Atas - 10 332 342

Sekongkang Bawah - 4 94 98

Total 189 740 1052 1,981

Source: Jereweh Sub-district Statistics Office, 1994

Of 1,981 families in Jereweh District in 1994, 1,725 (87 percent) used a river, their yards or field for bodily waste disposal. There were only 252 families (13 percent) who had their own lavatories. The means of transportation used by the inhabitants in Jereweh District in 1994 were still simple and included walking, riding livestock, or riding horse-drawn carriages. The lack of motorized vehicles in the area was an indication of the low geographic mobility of the inhabitants. Load-carrying animals, such as horse carriages, were still the dominant mode of transportation for carrying goods and passengers. For long distance travel there was public transportation such as inter-city and inter-village buses; however, the frequency of inter-district public transportation was still very low. Use of electric power was minimal in Sumbawa, particularly in Jereweh District in 1994. Only 44 percent of the families in the District had electricity at that time. There was a small electric power generating station in the Jereweh District capital (dusuns Belo/Beru). Power was usually available from 15:00 to midnight. A generating station was constructed in 1994 outside the residential area of Dusun Sekongkang Atas to supply periodic electricity to local residents. According to the Technical Report, consumption of petroleum products was also minimal in Jereweh District, particularly in the southern villages closest to the proposed Project. Gasoline was used largely for motorcycles and chain saws. Kerosene was used for lamps, and to a lesser degree, for cooking stoves. In the 1994 study, kerosene was used for lighting by 56 percent of the families; only 40 families used kerosene for cooking. Firewood was a major energy source in Kecamatan Jereweh, and provided most of the energy used for cooking. In 1994, an estimated 1,917 families (97 percent) used wood for cooking (Dames & Moore 1995).

At the time the 1994 Technical Report was prepared, there were no educational facilities above lower middle school in Jereweh. The educational level of Kecamatan Jereweh inhabitants was reported to be generally low at that time. Scholastic statistic for that period included:



• 1,848 (20.8%) were illiterate • 1,761 (19.8%) did not finish primary school • 4,761 (53.5%) were primary school graduates • 308 (3.5%) were junior high school graduates • 214 (2.4%) were senior high school graduates • 11 (.1%) held a Sarjana Muda (three-year university degree) • 1 (.01%) had a Sarjana (five-year university degree)

In 1994, 1,732 students attended school in this District and 105 teachers, making the teacher to student ratio 1:17. In addition to getting a formal education, the inhabitants also acquired knowledge from various vocational schools focused on sewing, rattan craft, coconut sugar production, and shrimp hatcheries. The University of Mataram had opened a branch of its Open University in Belo. The education level of the younger generation was higher than that of the older generation. For the older generation, primary school was thought to be sufficient, and only a small portion (18 percent) acquired a secondary education. By contrast, 45 percent of the younger generation had a secondary education, and 10 percent had attended college. In 1994, health facilities were limited and sanitation was poor in Jereweh District. In 1995, there were only two physicians in Jereweh, both in the District capital. Seriously ill or injured patients in Jereweh traveled 130 to 160 kilometers, on badly surfaced roads and with inadequate vehicles, to the City of Sumbawa Besar to be treated. While the AMDAL reported that the people in Jereweh District were generally healthy, records at the Jereweh Community Public Health Center (pukesmas) in Beru indicate that the 10 most prevalent maladies treated in 1993-1994 were, in order:

1. Musculoskeletal Complaints 2. Infectious Skin Diseases 3. Upper Respiratory Tract Illnesses 4. Clinical Malaria 5. Diarrhea (suspected Cholera) 6. Bronchial Asthma 7. Gastritis 8. Conjunctivitis 9. Acute Upper Respiratory Tract Infection 10. Clinical Tuberculosis

Musculoskeletal problems are common in an agrarian society. Respiratory problems, asthma, and conjunctivitis are associated with the use of wood for cooking, and by exposure to dust common in Indonesia during the dry season.

4.1.2 The 2008 Poverty Mapping Questionnaire Data

In 2008, the PTNNT External Relations Department conducted a survey of heads of households living in the Study Area communities (Figure 2). This information describes a variety of demographic statistics including family size, income, health, building conditions and other parameters. Over 6,300 surveys were completed for the Study Area communities.

4.1.3 The 2009 Focus Group Discussions

Between 6 and 12 December 2009, four community Focus Group Discussions were conducted as part of the Social Impact Assessment for the purposes of verifying baseline data directly with community representatives and to better understand community issues and concerns. A summary of these



discussions is presented in Section 5.4.23 – Stakeholder Meetings and a complete account of these meetings is presented in Appendix C.

4.2 Secondary Sources of Information

In addition to the primary data sources above, the following documents and data packages were also reviewed;

Now and Beyond, 2002, 2004, 2005 from www.newmont.com. Beyond the Mine, 2007 from www.newmont.com. 2007 Annual Report, A new day dawning. Newmont Mining Corporation. Community Relations Report, Newmont Mining Corporation Community Relations

Advisory Committee, May 2008. Community Development Programs, Evaluation Services 2005 for PT Newmont Nusa

Tenggara, Prepared by Gemilang Consulting, December 2004. Changes of Economic, Social, Cultural, and Health of the People Around the Mine in 2006,

Executive Summary, Prepared by PT Newmont Nusa Tenggara, in cooperation with the Center for Environmental Studies of Mataram University, Mataram, 2007.

Changes of Economic, Social, Cultural, and Health of the People Around the Mine in 2005,






PT Newmont Nusa Tenggara’s Socio Economic Impacts to West Nusa Tenggara Province

and West Sumbawa Districts in 2005, Economic and Community Investigation Institution, Economics Faculty, University of Indonesia.

Kabupaten Sumbawa Dalam Angka. Sumbawa Regency in Figures for 1994, 2004, 2007, and

2009. Population, Labour Force and Transmigration. Prepared by the Government of Indonesia, Badan Pusat Statistik Kabupaten.

Community Health Assessment Study in selected sub-districts of West Sumbawa, Nusa

Tenggara Province, Indonesia, International SOS, P2KP University of Mataram, PKKLI University of Indonesia, 2009.

In addition, various presentations and raw data files were provided by numerous

departments of PTNNT.



4.3 Preliminary Data Gap Analysis

The social and economic data in the 1994 Technical Report and the 1996 AMDAL have not been updated since written. For example the transmigration villages of SP 1 (Ai’ Kangkung), SP 2 (Tatar) and SP 3 (Talonang Baru Village) did not yet exist. Maluk and Benete were small hamlets (sub-villages) not specifically investigated during the development of the Technical Report or the AMDAL. There is no documentation as to the number of residents, households, occupations, incomes, or education levels in the AMDAL; PTNNT lacks current basic demographic information on the communities in their Study Area. The AMDAL also does not contain any information on other communities on Sumbawa or Mataram, which house significant numbers of employees and their families (AMEC 2008). Since 1994, PTNNT has made significant contributions to community infrastructure, which needs to be accounted for in the assessment of impacts.

4.4 Preliminary Impacts Identified

Several of the documents had specific information that was required for the SIA. The Q2 2008 Safety and Environmental Excellence (SEE) Management Review for External Relations (ExRel) included the following top 10 risks, which are considered as potential impacts:

Divestiture and local politics (default notice/arbitration)(Negative press campaigning by local government leaders)(fears of PTNNT default);

Forest Issues (permit extensions);

Forest Issues (exploration – tree cutting);

Regional taxes (fuel, heavy equipment, tailings, etc);

Pressure from local job seekers (subcontractors to prioritize local job seekers, contractors wanting to have the taxi concession);

Adverse NGO campaigns against PTNNT;

Community expectations for Elang exploration restart;

High community dependence on PTNNT;

Inadequate relationship with Jakarta media; and,

Business aspirations of other companies. Risk Factors, as reported in the 2007 Annual Report, Newmont Mining Corporation:

Recession or reduced economic activity.

Cancellation or renegotiation of contracts and/or permits:

o Interest in the Batu Hijau operation may be reduced under the Contract of Work:

Under the Contract of Work, beginning in 2005 and continuing through 2010, a portion of the shares of PT Newmont Nusa Tenggara, the subsidiary that owns Batu Hijau (PTNNT) must be offered for sale, first to the Indonesia government or second to Indonesian nationals such that the ownership interest of the Newmont/Sumitomo partnership in PTNNT would be reduced to 49 percent. Shares were offered in 2006 and 2007 with no buyers. In January 2008, the Newmont/Sumitomo partnership agreed



to sell, under a carried interest arrangement, 2 percent of PTNNT’s shares to Kabupaten Sumbawa, subject to satisfaction of closing conditions. On February 11, 2008, PTNNT received notification from the Department of Energy and Mineral Resources (DEMR) alleging that PTNNT was in breach of its divestiture requirements under the Contract of Work and threatening to issue a notice to terminate the Contract of Work if PTNNT does not agree to divest the 2006 and 2007 shares, in accordance with the direction of the DEMR by February 22, 2008. In November of 2009, 10 percent of PTNNT was divested to PT Multi Daerah Bersaing, a consortium comprised of regional and local governments near the Batu Hijau mine and PT Multicapital, a private company. Additional divestitures of up to 14 percent are also scheduled to take place in 2009 (Newmont 2009). Should future divestitures be delayed once again, it could have an adverse impact on operating and financial results.

o Borrow and Use permit: subsequent to the commencement of operations, the

government purported to designate the land surrounding Batu Hijau as a protection forest, which could make operating permits more difficult to obtain. PTNNT has been in discussions to renew its borrow and use permit (called ijin pinjam pakai) for over two years. This permit is a key requirement to continue to efficiently operate the Batu Hijau mine. The permit renewal was finally approved and obtained on 1 September 2009. Should future permit requests also be delayed, it could have an adverse impact on operating and financial results.

Royalty and tax increases or claims by governmental entities, including retroactive claims.

Expropriation or nationalization of property.

Risk of loss due to civil strife, acts of war, guerrilla activities, insurrection and terrorism: Recent violence committed by radical elements in Indonesia and other countries and the presence of US forces in Iraq and Afghanistan, may increase the risk that operations owned by US companies will be the target of violence. If any Newmont operations were so targeted, it could have an adverse effect on business.

Ability to operate could be adversely impacted by accidents or events detrimental (or perceived to be detrimental) to the health and safety of employees, the environment or the communities in which we operate (AMEC 2008).

4.5 The Batu Hijau Community Development Program

Since the beginning of Batu Hijau mine production in 2000 and through 2008, PTNNT has expended US$40.63 million, of which 80 percent went to community development programs (Figure 4). Community development programs have been aimed at improving the quality of life for communities surrounding the mine. Continuous human resource and economic development activities have been completed to reduce the potential negative impacts of mining. PTNNT is committed to the communities around the mine and believes they must accrue financial benefits from the mine operations through direct employment or other ancillary beneficial activities associated with the mine. PTNNT also believes the communities should obtain these benefits even after mine closure. PTNNT has made charitable donations for natural disasters, failed crops, sport and youth events, assistance to NGOs and other activities outside of the community development program. Funds allocated for donations between 2000 and 2009 were in the order of US$7.9 million (Figure 5).

Historic Community Development FundingPT Newmont Nusa Tenggara


Community Development Expenditure(In Million USD)

0.00

2.00

4.00

6.00

8.00

USD 6.10 3.60 2.40 3.00 4.10 5.20 5.66 5.05 5.52

2000 2001 2002 2003 2004 2005 2006 2007 2008

• The programs include infrastructures, capacity building, donation, scholarship, partnership with the government and NGOs, sponsorship, village assistance, etc.

• Overheads includes wages for 33 full time permanent employees, procuremen t of materials, etc. • Total: US$ 40.63 million, with US$ 4.514 million/year on average with ratio of 80% for program cost and

20% for overhead cost.

Historic Donation FundingPT Newmont Nusa Tenggara


2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Community Development Costs 6.100 3.600 2.400 3.000 4.100 5.200 5.660 5.675 6.796 5.612

Donation Cost 987 351 354 382 631 1558 1102 1100 827 850

020040060080010001200140016001800

0.000

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

US

D (

000)

US

D (

000)

Community Development Program

• The program includes infrastructure projects and capacity development programs include activities that include sponsorship donations, help the village, sports and youth activities, natural disaster and crop failure, social activities and so forth outside the programs of community development.• Total cost up to June 2009 was USD 44.3 million, including USD 7.9 million donation• The average cost USD 4.6 million / year with a ratio of 76% and 24% program overhead



In 2008, PTNNT allocated and distributed US$600,000 on charitable donations. The company has formed a donation committee which reviews all budget items. PTNNT divides its donations into three main categories:

Recurring: including the following donations which are made each year: o Village donation program for 49 villages in the Kabupaten Sumbawa Barat (KSB): each

village gets between US$2,500 and US$7,000 for projects the villages want to fund for a total of US$180,000

o Tongo electricity: US$50,000 for fuel for the generators o Independence Day celebrations: US$60,000 divided between Kabyoateb Sumbawa (KS)

and 8 sub-districts in the KSB. o Indonesian National Sports Committee groups in NTB, KS, KSB

Proposal: which is money set aside for emergency needs like tsunami or earthquake relief.

o The amount of these donations varies each year depending on circumstances.

Scholarships: as proposed and approved by the committee.

The full donation policy is included in this report as Appendix D. The PTNNT community development program comprises four strategic objectives:

1. Infrastructure development: In partnership with the government, this program is intended to reduce PTNNT impact on local facilities by improving infrastructure and public facilities which, in turn, promote economic and social development. Since 1997, PTNNT has been involved in a comprehensive community development program focused on development in the 15 villages of the three sub-districts within its Area of Influence:

Jereweh, including the villages of Dasan Anyar, Goa, Belo, Beru; Sekongkang, including the villages of Sekongkang Atas, Sekongkang Bawah, Tongo, Ai’

Kangkung, Tatar, Talonang Baru; and, Maluk. Benete, including the villages of Maluk Loka, Mantun, Pasir Putih, Bukit Damai.

Descriptions of specific community investments are included in the community profiles in

Section 5.5.21.

2. Agriculture and small business development: This strategic objective is intended to guarantee continuous household sources of income through the development of advanced, integrated and value added agricultural practices, and through competitive business skill training to reduce unemployment and stimulate investment.

3. Public health: This development strategy aims to improve basic health standards through health education programs focused on reducing infectious diseases and children and pregnant women nutrition through the activities of the posyandu (integrated services post) and local health clinics (puskesmas).

4. Education: This strategy objective is to improve basic skills and primary formal education of the community in partnership with the government and active participation from the community.

PTNNT partnered and consulted with the government, NGOs, academic institutions, private sector, donor agencies, communities and other parties to guarantee and promote a sense of ownership among the stakeholders. In this context, PTNNT supported the establishment of two foundations, Yayasan Olat Parigi (YOP) and Yayasan Pengembangan Ekonomi Sumbawa Barat (YPESB),



Most important in the strategic implementation of the above programs is the close partnership with the local community. Community development programs are collaborated with local communities represented by a Village Delegate to develop transparent and interactive community development programs. The Village Delegates is a group of community leaders that bridge community interests with the PTNNT Community Development department. Two participative mid-term planning workshops have been held in each village as part of a joint community development program. The first workshop took place in 2003 to prepare the 2005-2009 Strategic Plan. The second workshop took place to prepare the Strategic Plan for 2009-2013. In this second workshop, an evaluation of the 2005-2009 strategic plan took place. The workshop applied a methodology of Participatory Rural Appraisal (PRA) aimed at ensuring that the expectations and the needs of the community would be fully integrated in the PTNNT community development programs. In addition to the YOP and YPESB foundations, PTNNT also cooperates with other parties in the implementation of community development activities, as shown in Table 4.3. Table 4.3 - Partners Involved in the PTNNT Community Development Programs Government Institutions and State Companies Private Sector Kimpraswil Dinas Kehutanan Dinas Kesehatan Dinas Pertanian Dinas Pendidikan Nasional Badan Perpustakaan Daerah Lembaga Penjamin Mutu Pendidikan Mataram Dinas Peternakan Dinas Koperasi Dinas Perikanan Balai Latihan Kerja Mataram Kantor Bupati/Sekretariat Daerah PDAM Sumbawa Bappeda Kantor Camat Kantor Desa

PT. Trakindo PT. Permodalan Nasional Madani CV. Marta Agung Group Mega Arafah Accommodation &

Restaurant Bisma – Maluk CV. Sekongkang Mitra Jasa CV. Rangga CV. Matano Koperasi Somil Koperasi Kemuning Jaya Koperasi Perdana Karya Mandiri UD Paradiso PKPMT Mataram Public Accountant – Salam Rauf

Civil Society Groups Universities and Schools Bina Swadaya LP3ES Jakarta Yayasan Serikat Tani Pembangunan Aspirasi Taliwang Sumbawa Barat dan Terapi Labuhan Lalar

Taliwang Sumbawa Barat (Grouper Cultivation) YKSSI NTB (public health) Koalisi untuk Sumbawa Sehat PSP-NTB (functional literacy) Yayasan Dharma Bhakti Astra Jakarta Komite Pengembangan Desa (Village Development Committee) Karange Taruna LKMD Forum for Local Agricultural Cooperative BUMDes

Universitas Mataram SLTP Buin Batu International School Batu Hijau

As a whole, community development activities (already) undertaken by PTNNT embody community empowerment and infrastructure development. Community empowerment activities involve activities in the sectors of education, health, economy, agriculture and fish farming. Infrastructure development project comprised building/provision of education, health, agriculture facilities;



community empowerment, religious, socio-cultural and sport and youth facilities. Table 4.4 summarizes the investments PTNNT has made through its Community Development program from 1998 to 2009 and indicates the relationship between these investments and the achievement of Millennium Development Goals. A complete list of investments made in each community between 2000 and 2009 is presented in Appendix E.



Table 4.4 - Community Development (ComDev) Investments, 1998-2009 Opportunity Input Process Output Outcome Impact

Roads in Study Area need improvement and on-going maintenance.

PTNNT provides US$2,545,426 capital investment for design and construction of new, upgrading of existing roads, and maintenance of roads.

PTNNT secured local contractors in partnership with the district government to implement road improvements in the Study Area.

From 1998 to 2009, road construction and maintenance conducted for 337 km of roads in the Study Area and includes: 4 Bridges 33 km of asphalt 48.14 km average/year

Improved roads allow improved transportation between communities. Improved linkages between communities.

Improved quality of life for local residents, improved transportation safety, improved economic and market development facilitated by improved transportation routes.

Lack of adequate drainage in Study Area communities leads to seasonal flooding and potential loss of life, structures, and crops.

PTNNT provides US$783,544 capital investment for design and construction of improved drainage systems.

PTNNT secured local contractors in partnership with the local government to implement drainage improvements in the Study Area.

From 1998 to 2009, drainage was improved for 70,098 meters.

Drainage improvements allow water to leave an area in a safe and efficient manner.

Improved quality of life for local residents, improved safety in homes and fields, and decreased loss of crops helping to achieve three Millennium Development Goals (MDGs): eradicate extreme poverty and hunger, ensure environmental sustainability, and combat HIV/AIDS, malaria and other diseases by reducing the amount of standing water.

Lack of potable water impacting health and productivity of local residents.

PTNNT provides US$716,012 capital investment for design and construction of water systems. PTNNT provides training to local residents to manage water systems.

PTNNT secured local contractors in partnership with local and district governments to implement clean water systems

From 1998 to 2009, potable water systems were built in seven villages serving 2,358 households.

Potable drinking water is now available in seven villages which previously relied on hand dug wells and/or river water.

Improved quality of life for local residents helping to achieve MDGs of reducing childhood mortality, improving maternal health, and combating HIV/AIDS, malaria and other diseases.

Lack of solid waste disposal facilities leading to unsanitary conditions.

PTNNT provides US$211,348 investment for provision of solid waste disposal facilities, transportation and equipment.

PTNNT secured local contractors in partnership with local and district government to implement garbage collection and disposal systems.

From 1998 to 2009, garbage collection and disposal systems were implemented consisting of: 74 Temporary Garbage Bins 3 Landfills 4 Garbage Trucks

Sanitary solid waste disposal facilities are now available throughout the communities in the Study Area.




Opportunity Input Process Output Outcome Impact

Lack of medical facilities leading to unsatisfactory health indicators and outcomes.

PTNNT provided US$755,969 capital investment for design, construction or renovation of community health facilities.

PTNNT secured local contractors in partnership with local and district government to implement medical facility program improvements.

From 1998 to 2009, medical facility systems improvements were implemented consisting of: 3 Puskesmas 6 Pustu 10 Posyandu

Community-based medical facilities are now available providing residents throughout the Study Area with improved health care.


Lack of a comprehensive educational system required local students to travel long distances for education or resulted in little or no education for many students.

PTNNT provided US$2,191,282 capital investment to design and construct or renovation of schools. PTNNT provided scholarships for high-performing students and education assistance for economically-challenged students.

PTNNT secured local contractors in partnership with local and district government to implement educational facility improvement program.

From 1998 to 2009, PTNNT built and/or improved education facilities, including: 7 Kindergartens 13 Elementary 4 Junior High 1 Senior 2 Islamic (madrassas) 24 School Libraries

Community-based educational facilities are now available throughout the Study Area. Funds are available for students to continue their education.

Improved quality of life for local residents helping to achieve the MDG of achieving universal primary education; improved the quality of education for long-term economic development/employment opportunity and personal/community satisfaction.

Lack of comprehensive irrigation system (see item 9) leading to loss of potential agricultural production

PTNNT provided US$14,661 to train members of irrigation water users association in effective irrigation techniques and maintenance programs.

PTNNT provides agricultural experts to perform the training.

From 1998 to 2009, members of four irrigation water user associations were formed and trained.

Community-based operation and maintenance of the irrigation is building the capacity of local residents.

Improved quality of life for local residents, improved efficiency in fields helping to achieve the 1 MDG of ensuring environmental sustainability

Lack of community public buildings and amenities.

PTNNT provided US$1,734,877 capital investment to design and construct a variety of public facilities.

PTNNT secured local contractors in partnership with local and district government to improve community facilities.

From 1998 to 2009, PTNNT helped to build multi-purpose halls in five communities and seven public toilets.

Multi-purpose halls provide a community center for public events. Public toilets improve sanitation and convenience as well as eliminating the use of rivers and latrines.

Improved quality of life for local residents, adding to community cohesiveness and feelings of well-being. May contribute to MDG of ensuring environmental sustainability and combating diseases.




Lack of comprehensive irrigation system (see item 7) leading to loss of potential agricultural production because of lack of irrigation during the dry season.

PTNNT provided US$4,496,065 capital investment to develop and implement a comprehensive irrigation system.

PTNNT secured local contractors in partnership with local residents and local government to implement the land irrigation program.

From 1998 to 2009, six irrigation structures were constructed which irrigate 1210 ha of rice fields with 18,766 m of channels.

Community-based operation and maintenance of the irrigation is building the capacity of local residents while allowing farmers to increase their crop yield by being able to farm during the dry season.

Improved quality of life for local residents, improved crop production helping to achieve two MDGs: eradicate extreme poverty and hunger and ensure environmental sustainability.

Lack of a diverse economy means that a community relies too heavily on the mining operations for economic activities.

PTNNT provided US$310,686 capital investment to develop two beaches in the Study Area with facilities designed to appeal to and increase tourism.

PTNNT secured local contractors in partnership with local residents and local government to implement the development of the beaches.

From 1998 to 2009, tourist facilities were developed at two beaches, including restaurants and a platform for dining.

Tourism is not a significant part of the economy on Sumbawa even though there are several world-class beaches in the area. Tourist facilities developed jobs at the beach as well as providing indirect job creation at local hotels and restaurants.

Improved quality of life for local residents who may enjoy the beaches or who may find employment at a tourist development; helping to achieve MDGs of ensuring environmental sustainability and developing a global partnership for development.

Flooding is a major problem during the rainy season and stabilizing rivers is possible to reduce the risk of flooding of adjacent communities.

PTNNT provided US$132,000 to design and construct water flow stabilization solutions for rivers in the Study Area.

PTNNT secured local contractors to execute river stabilization plans.

From 1998 to 2009, rivers that flow through three communities in the Study Area were stabilized to minimize flood potential.

River stabilization improvements allow water to leave an area in a safe and efficient manner reducing the threat of floods.

Improved quality of life for local residents, improved safety in homes and fields, and decreased threat of flood and flood-related losses helping to achieve two MDGs: ensure environmental sustainability, and combat HIV/AIDS, malaria and other diseases by reducing the amount of standing water.




Local market places are not only a cultural icon but also an important component of a balanced economy.

PTNNT provided US$254,658 to develop and/or improve local markets.

PTNNT secured local contractors in partnership with local residents and local government to develop and/or improve local market places.

From 1998 to 2009, traditional market places were developed in Sekongkang and expanded and improved in the communities of Maluk and Beru.

Development and/or expansion of traditional market places add to community cohesiveness and stability as well as providing a market for home grown produce and other products.

Improved quality of life sense of well being for local residents by providing a traditional meeting place. Markets can also help to achieve MDGs of promoting gender equality and empower women and develop a global partnership for development.

Source: Community Development (ComDev) Project Data (PTNNT 2009b).



5.0 CONTEXT AND BASELINE INFORMATION

This Section provides background national, provincial, sub-district and local information. It describes the human environment from the beginning of PTNNT operations in 2000 to the end of 2008.

5.1 Overview and Demographic Profile of Indonesia

5.1.1 General Overview

Indonesia is an archipelago of 17,508 islands, of which approximately 6,000 are inhabited (Figure 6). The archipelago straddles the equator, along strategic major sea lanes from the Indian Ocean to Pacific Ocean. Indonesia encompasses 1,904,569 sq km, of which roughly two-thirds is land (1,811,569 sq km) and 93,000 sq km is water with a coastline of 54,716 km. The entire archipelago is slightly less than three times the size of Texas. Only about 11 percent of the land is arable, of which only 7 percent is used for permanent crops (CIA 2009). Indonesia is mostly coastal lowland, although larger islands have interior mountains. The country has the largest number of historically active volcanoes (76) of its total of 1,171 (USGS 2009). The climate is tropical: hot and humid in the coastal lowlands and more moderate in the highlands. Natural resources include petroleum, tin, natural gas, nickel, timber, bauxite, copper, fertile soils, coal, gold, silver. Natural hazards common to Indonesia include occasional floods, severe droughts, tsunamis, earthquakes, volcanoes, and forest fires (FAO 2009).

5.1.2 Demographic Profile

Table 5.1 below summarizes social and demographic characteristics of the Indonesian population. According to United States Central Intelligence Agency (CIA 2009), over 240 million people lived on the archipelago in 2009. As reported in the CIA summary, the most recent estimate in 2009 reported the following breakdown of ethnic groups:

Javanese – 40.6 percent Sundanese – 15 percent Madurese – 3.3 percent Minangkabau – 2.7 percent Betawi – 2.4 percent Bugis – 2.4 percent Banten – 2 percent Banjar – 1.7 percent Other or unspecified – 29.9 percent

Common languages include Bahasa Indonesia (official, modified form of Malay), English, Dutch, and local dialects (the most widely spoken of which is Javanese). The Republic of Indonesia is primarily Muslim (86.1 percent of the population), followed by Protestant (5.7 percent), Roman Catholic (3 percent), Hindu (1.8 percent), and other or unspecified (3.4 percent).

Kalimantan Timur

Kalimantan Barat

Kalimantan Tengah

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Jawa Barat

Jawa Timur

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Sulawesi Selatan

Jawa Tengah

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Kalimantan Selatan

Nusa Tenggara Barat N

Nusa Tenggara Timur

Yogyakarta

Sumatera Selatan

Jakarta Raya


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Table 5.1 - Social and Demographic Characteristics of the Indonesian Population (2009 Estimates)

Category Data Population 240,271,522 Age structure 0-14 years: 28.1% (male 34,337,341 - female 33,162,207)

15-64 years: 66% (male 79,549,569 - female 78,918,321) 65 years and over: 6% (male 6,335,208 - female 7,968,876)

Median age Total: 27.6 years Male: 27.1 years Female: 28.1 years

Population growth rate 1.136% Birth rate 18.84 births/1,000 population Death rate 6.25 deaths/1,000 population Infant mortality rate

total: 29.97 deaths/1,000 live births male: 34.93 deaths/1,000 live births female: 24.77 deaths/1,000 live births

Life expectancy at birth

total population: 70.76 years male: 68.26 years female: 73.38 years

Total fertility rate 2.31 children born/woman Sex ratio At birth: 1.05 male(s) : female

under 15 years: 1.03 male(s) : female 15-64 years: 1.01 male(s) : female 65 years and over: 0.8 male(s) : female total population: 1 male(s) : female

HIV/AIDS - adult prevalence rate: (2007 est.) 0.2% HIV/AIDS - people living with HIV/AIDS: (2007 est.) 270,000 HIV/AIDS - deaths: (2007 est.) 8,700 Literacy: (2004 est.) definition: age 15 and over can read and write.

total population: 90.4% male: 94% female: 86.8%

Source: CIA 2009

National figures may not account for considerable regional disparities in health indicators. For example, the infant mortality rate in 1998 ranged from 27 per 1000 live births in Jakarta to 90 in West Nusa Tenggara (WHO 2009). HIV/AIDs is not yet a major health issue in Indonesia. However, significant infectious diseases in the nation include food or waterborne diseases such as bacterial diarrhea, hepatitis A and E, typhoid fever, and vector borne diseases including chikungunya, dengue fever, and malaria.

5.1.3 Macro Socio-Economic and Political Setting

Historical and Political Settings

The Dutch began to colonize Indonesia in the early 17th century. Japan occupied the islands from 1942 to 1945. Indonesia declared its independence after Japan's surrender, but it required four years of intermittent negotiations, recurring hostilities, and UN mediation before the Netherlands agreed to transfer sovereignty in 1949. Current important socioeconomic issues in Indonesia include alleviating poverty, improving education, preventing terrorism, consolidating democracy after four decades of authoritarianism, implementing economic and financial reforms, stemming corruption, holding the military and police accountable for past human rights violations, addressing climate change, and controlling avian influenza.



National Politics

Indonesia's first free parliamentary election after decades of Suharto’s rule took place in 1999. Indonesia is now the world's third-largest democracy, the world's largest archipelagic state, and home to the world's largest Muslim population. The Executive branch of the government includes President Susilo Bambang Yudhoyono, first elected in October 2004 and reelected in July 2009 along with his Vice President Muhammad Yusuf Kalla. The president and vice president serve five-year terms (eligible for a second term) by direct vote of the citizenry. The next national election will be held in July 2014. The president appoints his own cabinet of administrative managers. The Legislative branch of the Indonesian republic includes:

House of Representatives or Dewan Perwakilan Rakyat (DPR). The DPR formulates and passes legislation at the national level and has 550 members who are elected to serve five-year terms;

House of Regional Representatives (Dewan Perwakilan Daerah or DPD). The DPD has a

constitutionally mandated role which includes providing legislative input to DPR on issues affecting regions elections; and,

People's Consultative Assembly (Majelis Permusyawaratan Rakyat or MPR). The MPR is the

upper house, consists of members of DPR and DPD, and is responsible for inaugurating and impeaching the president (if necessary) and amending the constitution. The MPR does not formulate national policy.

The Judicial branch includes:

Supreme Court or Mahkamah Agung. This court is the final court of appeal but it does not have the power of judicial review (justices are appointed by the president from a list of candidates selected by the legislature). In March 2004, the Supreme Court assumed administrative and financial responsibility for the lower court system from the Ministry of Justice and Human Rights;

Constitutional Court or Mahkamah Konstitusi. This court has the power of judicial review, jurisdiction over the results of a general election, and reviews actions to dismiss a president from office;

Labor Court. This court operates under supervision of Supreme Court and began functioning in January 2006; and,

The Anti-Corruption Court. The court has jurisdiction over corruption cases brought by the independent Corruption Eradication Commission. In 2006, the Constitutional Court declared the mechanism by which the Anti-Corruption Court was established unconstitutional and gave the parliament until the end of 2009 to pass Anti-Corruption Court legislation.

Local Governance

Indonesia is divided into 30 administrative provinces (provinsi-provinsi), two special regions* (daerah-daerah istimewa), and one special capital city district** (daerah khusus ibukota) as follows:



Aceh* Bali Banten Bengkulu Gorontalo Jakarta Raya** Jambi, Jawa Barat Jawa Tengah Jawa Timur Kalimantan Barat

Kalimantan Selatan Kalimantan Tengah Kalimantan Timur Kepulauan Bangka Belitung Kepulauan Riau Lampung Maluku Maluku Utara Nusa Tenggara Barat Nusa Tenggara Timur

Papua, Papua Barat Riau, Sulawesi Barat Sulawesi Selatan Sulawesi Tengah Sulawesi Tenggara Sulawesi Utara Sumatera Barat Sumatera Selatan Sumatera Utara Yogyakarta*

Regional districts are presented on Figure 6. Following decentralization which began on 1 January 2001, the 465 sub-districts and major municipalities have become the key administrative units responsible for providing most government services.

Economy

Indonesia, a vast multilingual nation, has made significant economic advances under the administration of President Susilo Bambang Yudhoyono, but faces challenges stemming from the global financial crisis and world economic downturn. Indonesia's debt-to-GDP (Gross Domestic Product) ratio in recent years has declined steadily because of increasingly robust GDP growth and sound fiscal stewardship. The government has introduced significant reforms in the financial sector, including reforms in the areas of tax and customs, the use of Treasury bills, and capital market supervision. Indonesia's investment law, passed in March 2007, seeks to address some of the concerns of foreign and domestic investors. Indonesia still struggles with poverty and unemployment, inadequate infrastructure, corruption, a complex regulatory environment, and unequal resource distribution among regions. The non-bank financial sector, including pension funds and insurance, remains weak, and despite efforts to broaden and deepen capital markets, remains underdeveloped. Economic difficulties in early 2008 centered on high global food and oil prices and their impact on Indonesia's poor. The onset of the global financial crisis dampened inflationary pressures, but increased risk aversion for emerging market assets resulted in large losses in the stock market, significant depreciation of the rupiah, and a difficult environment for bond issuance. As global demand has slowed and prices for Indonesia's commodity exports have fallen, Indonesia faces the prospect of growth significantly below the 6-plus percent recorded in 2007 and 2008. The rupiah has remained relatively stable against major currencies throughout 2009 and is currently averaging 9,000 rupiah (IDR) to each USD. Table 5.2 below presents a summary of economic statistics in Indonesia. Table 5.2 - Summary of Indonesian Economic Indicators (2008 Estimate) Category Data

GDP (purchasing power parity) US$915.9 billion GDP - real growth rate 6.1% GDP - per capita: Purchasing power parity US$3,900 GDP - composition by sector Agriculture: 13.5%

Industry: 45.6% Services: 40.8%

Labor force 112 million Unemployment rate 8.4% Labor force by occupation (2005 est.) Agriculture: 42.1%

Industry: 18.6% Services: 39.3%

Population below poverty line (2006 est.) 17.8%



Category Data

Household income or consumption by percentage share (2002 est.) Lowest 10 percent: 3.6% Highest 10 percent: 28.5%

Inflation rate consumer prices 11.1% Investment (gross fixed) 23.6% of GDP

Source: CIA 2009

The major food products of Indonesia include rice, cassava (tapioca), peanuts, rubber, cocoa, coffee, palm oil, copra, poultry, beef, pork and eggs. Major industries include petroleum and natural gas, textiles, apparel, footwear, mining, cement, chemical fertilizers, plywood, rubber, food, and tourism. In 2008, mining made up over 11 percent of the national economy. Indonesia is one of the world’s largest producers of tin (ranked 2nd after China), coal (ranked the 3rd largest thermal coal exporter after Australia and South Africa) and copper (ranked 3rd largest, after the USA and Chile). It also produces significant quantities of gold and nickel. Minerals and related products represented 19 percent of Indonesia’s total exports, with gold being the largest revenue earner. Indonesia is also a producer of bauxite, phosphates and iron sand, with potential for alluvial diamond production as well (Earthstone 2009).

5.2 Nusa Tenggara Barat Province

The Nusa Tenggara Barat (NTB) providence is in south-central Indonesia. It covers the western portion of the Lesser Sunda Islands, except for Bali (Figure 6). The two largest islands in the province are Lombok in the west and the larger Sumbawa in the east. Lombok and Sumbawa had a combined total population of approximately 3.3 million in 1994 (pre-project). The two islands are very different. Lombok occupies less than 24 percent of land area (4,738.7 km2) yet contained more than 61 percent of NTB’s population (2.01 million) in 1994. Sumbawa occupies more than 76 percent of land area (15,414.45 km2) and contained less than 39 percent of NTB’s population (1.29 million) in 1994 (PTNNT 1996). According to the 2000 census, the population of the province was 3,821,134 and 71 percent of the population lived on Lombok. The population grew steadily from 2000 reaching 4,076,040 in 2004 and 4,257,306 in 2006. In 2008, the population of the province had growth to 4,363,756 people (NTB 2009), with an average annual growth rate of 1.8 percent per year (Kabupaten Sumbawa Dalam Angka 2009). As presented in the AMDAL, NTB straddles the demographic divide between overpopulated “inner” Indonesia and “population deficient” outer Indonesia. Lombok is mainly inhabited by the Sasak ethnic group, with a minority Balinese population, and Sumbawa is inhabited by Sumbawa and Bima ethnic groups. Each of these groups has a local language associated with it as well. The western part of Sumbawa Island is populated by people migrating into Sumbawa in addition to the indigenous Sumbawa people. The Sumbawa ethnic group generally exhibits more affinity in language and culture (and more mixing of populations) with the Sasaks than with the Bima ethnic group of eastern Sumbawa Island (PTNNT 1996). The province is administratively divided into eight regencies (kabupaten) and two municipalities (kotamadya, as follows):

Bima Dompu West Lombok Central Lombok East Lombok

North Lombok Sumbawa West Sumbawa Bima (municipality) Mataram (municipality)



Mataram (Kota Mataram) is an independent city carved out of the Kabupaten Lombok Regency on the west side of the island of Lombok. It is the capital and largest city of the NTB province, and had a population of around 342,896, as estimated in 2005. The 2008 population was estimated to be 362,243 (Kabupaten Sumbawa Dalam Angka 2009), indicating the same average growth rate of 1.8 percent per year experienced by the province as a whole. Three towns constitute the Mataram area. From west to east, these are Ampenan, Mataram, and Cakranegara. They are distinct towns, but overlap physically and culturally. In general, Ampenan is an aging port city, Mataram is the governmental and office center for the province, and Cakranegara is the major commercial center on the island. There are six sub-districts of Mataram, namely Ampenan, Cakranegara, Mataram, Pejanggik, Selaparang, and Sekarbela. The city is served by the Selaparang Airport and Lembar Harbour. Mataram is located near the west coast of Lombok, so it is very close to Senggigi beach, which is in the neighboring regency. Mataram was also the seat of power for the king of Mataram (Seraja), which was sometimes controlled through neighboring Singaraja.

5.3 Kabupaten Sumbawa Barat (West Sumbawa District)

The Batu Hijau Study Area lies within the Kabupaten Sumbawa Barat (KSB), also called the West Sumbawa District (WSD), which is one of eight regencies in the NTB province and which occupies the western and larger “lobe” of the Island of Sumbawa. The Regent or head of the District (Bupati) is elected to office and resides in the capital of Taliwang. The population of KSB was estimated to be 99,056 people in 2008 (Kabupaten Sumbawa Dalam Angka 2009). The administrative region where the Batu Hijau area is located has undergone an administrative division since the inception of the mine. In 2003, the original Sumbawa District was divided into two Districts, Kabupaten Sumbawa (KS) and Kabupaten Sumbawa Barat (KSB). The mining area is in the KSB. In 2003, the Jereweh sub-district (within the KSB) was divided into the Jereweh and Sekongkang sub-districts; and in 2007 the Jereweh sub-district was further divided creating two sub-districts Jereweh and Maluk. The current sub-districts in the region are Pototano, Seteluk, Taliwang, Brang Rea, Brang Ene, Jereweh, Maluk and Sekongkang. The Study Area sub-districts of Maluk, Sekongkang and Jereweh are shown on Figure 2 (PTNNT 2009).

5.4 Batu Hijau Study Area

The Study Area for the Batu Hijau Project has changed since the AMDAL was written in 1996. The AMDAL contained socioeconomic information for the Jereweh, Seteluk, and Taliwang districts, but the Project did not impact those areas as anticipated. Since mining began the majority of the people affected reside in the Jereweh District. The second change was the creation of the KSB which in 2008 had the following sub-districts, all of which have communities in the Batu Hijau Study Area:

Jereweh sub-district – in 1994 this was the only district in the Study Area Sekongkang sub-district – created in 2004 divided from the Jereweh District Maluk sub-district – created in 2007 divided from the Jereweh Sub-district

In the last 15 years, several demographic changes have occurred in the sub-districts making up the Batu Hijau Study Area. In 1994, the Jereweh sub-district contained the villages of Goa, Beru, Belo, Maluk, and Sekongkang. In 2004, the Jereweh sub-district contained Goa, Beru, Belo, Maluk, and Benete and the Sekongkang sub-district contained Sekongkang Atas, Sekongkang Bawah, Tongo, Ai’ Kangkung (SP-1), and Tatar (SP-2). In 2007, the Jereweh sub-district contained Goa, Dasan Anyar (formerly a hamlet of Goa), Beru, and Belo; the Sekongkang sub-district contained Sekongkang Atas, Sekongkang Bawah, Tongo, Ai’ Kangkung, Tatar, and Talonang Baru Village (SP-3); and the Maluk sub-district contained Maluk (including Mantun, Maluk Loka, Bukit Damai, and Pasir Putih) and Benete.



The new sub-districts were created to reduce the distance from population centers to service providers and to reformat the distribution of taxes. The Camat (Head) of the sub-districts were appointed by the Bupati. In 1996, before mine construction, there was one Camat and 10 village heads. There are now three Camat and 15 village heads. Profiles of each of the communities in the Study Area are presented in Section 5.5.21 - Community Profiles in the Study Area.

5.4.1 Population and Ethnicity

The population of the Jereweh, Sekongkang and Maluk sub-districts also underwent several notable changes prior to and over the 14 years of the Batu Hijau mine construction and operation. From 1994-2004, the growth rate in the original Jereweh sub-district averaged 13.9 percent per year. In contrast, the population growth rate decreased to 2.7 percent per year between 2004 and 2007 (PTNNT 2009). The initial surge in the population growth rate in the area surrounding the mine is likely due to a large in-migration of people from other areas in the KSB and the NTB. When the Batu Hijau Project commenced operations a large workforce could not be available locally from the communities surrounding the mine. The subsequent decrease in population growth rate from 2004-2007, as compared to the previous 10 years, suggests that in-migration of workers to the area surrounding the mine has slowed as positions were filled at the mine or creation of jobs supporting the mine dwindled. Table 5.3 - Regional Coverage, Population, and Population Density in the Kabupaten Sumbawa Barat (2004)

Area

Extension

(km2)

No. of

Families

Population

(individual)

Average

family

members

Density

(per km2)

male female total

Kec. Sekongkang 305.13 2,033 4,524 3,876 8,400 4.1 27.5

Kec. Jereweh* 574.67 3,745 6,952 6,169 13,121 3.5 22.8

Subtotal 879.8 5,775 11,476 10,045 21,521 3.7 24.5

Kab. Sumbawa Barat 1,849.02 22,352 47,344 45,061 92,405 4.1 50.1

Source: Sumbawa Barat Dalam Angka, 2004 * - including the current Maluk sub-district

The population increase and population growth for the period 1994-2004 in the mine area differed from other areas of Indonesia over the same time period. In this period, the growth rate in the original Jereweh sub-district averaged 13.9 percent per year. From 1990-2000, the population growth in the original Sumbawa District (outside the mine area) averaged 1.7 percent and 1.2 percent in the West Nusa Tenggara province. Data on what has now become the KSB shows that from1994-2004, the population growth rate peaked at 3.5 percent per year falling to 1.6 percent per year from 2004-2007. Before mining began, the sex ratio in the Jereweh sub-district was nearly 1:1 (male to female). As mining progressed, the ratio subsequently became uneven (1.26:1in 2000). This change indicates that in-migration to the mine area brought more males to the area than females. The sex ratio has continued to change, as evidenced by a ratio of 1.14:1 in 2004 and 1.01:1 in 2007 (calculations based on Tables 5.3 and 5.4). This change in the ratio of males to females with time may be related to the completion of major contracted work at the mine, an increase in employment opportunities for women, and/or the movement of women and families following their husbands who worked in the mine. Regardless of the reason, the sex ratio has become relatively even again by 2007.



Table 5.4 - Regional Coverage, Population, and Population Density in the Kabupaten Sumbawa Barat (2007)

Area

Extension

(km2)

No. of

Families

Population

(individual)

Average

family

members

Density

(per km2)

male female total

Kec. Sekongkang* 372.42 1,640 3,511 3,415 6,926 4.2 18.6

Kec. Jereweh* 260.19 1,754 3,231 3,552 6,783 3.9 26.1

Kec. Maluk* 92.42 2,685 5,003 4,573 9,576 3.6 103.6

Subtotal 725.03 6,079 11,745 11,540 23,285 3.8 32.2

Kab. Sumbawa Barat 1849.02 25,889 48,323 48,690 97,013 3.8 52.5

Source: Sumbawa Barat Dalam Angka, 2007 * - in 1994, the three sub-districts were part of the Jereweh sub-district in the district of Sumbawa The data presented in Tables 5.3 and 5.4 above also show that the Maluk sub-district has seen a significant increase in population density. In 1994, the village of Maluk was a hamlet of the Benete village with less than 200 families. With the in-migration of workers to the mine, Maluk has developed rapidly and has become a village and sub-district in its own right.

5.4.2 Community Cultural Background

The pre-mine operation inhabitants of the area surrounding the Batu Hijau mine originated from the Sumbawa ethnic group (Tau Samawa) which, within certain limits, has been impacted by the Bugis culture. Since mine operations, cultural backgrounds in the population surrounding the mine area have become more diverse likely due to an in-migration of diversified cultures from outside the NTB and KSB. For example, newcomers arrived from the islands of Java (Java and Sunda cultural background), Sulawesi (Bugis and Minahasa culture), etc.

5.4.3 Religion and Culture

Based on the 2000 census, approximately 86.1 percent of Indonesians were Muslims, 5.7 percent were Protestant, followed by Catholic (3 percent), Hindu (3.4 percent) and Buddhist and other unspecific religions (CIA 2009). The number of places of worship in the NTB Province has increased with population growth. Islam is the religion of a majority of the population. In 2008, as many as 5,522 residents of NTB Province set out as hajj pilgrims. A reported 4,510 had returned and 12 had died in the Holy Land of Mecca (NTB 2009b). While specific information on religion is not available for each community in the Study Area, it has been estimated that approximately 99 percent of the residents in the Study Area are Muslim. Local Muslims consider themselves to be moderate Muslims adhering to the traditional form. Recently adherents of the stricter Saudi Wahhabi sect (from Saudi Arabia) have moved to the area, rejecting local cultural mores where girls have a choice about wearing the head scarf. There are no churches or temples in KSB, although there are Christians and Hindus living in the area. PTNNT reports that an estimated 90 percent of the PTNNT workforce is Muslim, with between 10 and 20 percent being devout. PTNNT provides a mosque in Buin Batu and praying rooms (known as musholla) in most work facilities for prayer, including at the mine. Workers are allowed time for prayer twice a day (between 15-30 minutes each) for Dzuhur (mid-day prayer between 12:00 – 15:00) and Adazar (afternoon prayer between 15:20 – 18:30). On Fridays they receive an additional hour at noon after which most devout Muslims leave for the weekend.



In addition, no pork or pork products has been served in any PTNNT facility since 2001/2002 (private living quarters excluded). Muslims do not eat reptiles, amphibians, turtles, or eagles. Alcohol is available at the club and the commissary. No alcohol is available at the employee cooperative food store. PTNNT restructures its work assignments to accommodate Ramadan during which Muslims take no food or water from sunup to sundown. Mine output is reduced and workers have special safety training during this time. Hobbies of local people include sports such as soccer, badminton, and volleyball for men or for women at mosque clubs that focus on maternal health and exercise. Local fashion is dictated by religion. Women wear head scarves known as jibab (more and more often being decorated with sequins or pins or unique folds). Women also cover their necks, shoulders, and arms when in public. Men wear beards to symbolize masculinity and hats to protect their body energy from leaking out. A white hat indicates that the wearer has been on a Hajj.

5.4.4 Education

Education levels within the Batu Hijau Study Area have shown significant changes since mine operations (Table 5.5). Local availability of educational opportunities has increased where PTNNT has contributed to their development. Table 5.5 - Comparison of Education Facilities Around the Batu Hijau Mine, Before (1995) and Since Operations (2002, 2003 and 2004)

Education Facility

Number of Facilities

1995 2002 2003 2004

Kindergarten 1 8 9 10

Primary school 13 13 15 16

Junior high school 1 4 4 5

Senior high school - 1 1 1

Total 15 26 29 32

Source: Education, Youth and Sport Regional office West Sumbawa district

PTNNT has directly increased the number of schools in the Jereweh, Sekongkang and Maluk sub-districts. In 2007, there were 2,987 students of primary schools (Table 5.6), 834 students of junior high (Table 5.7), and 339 students of senior high schools (Table 5.8) in the Study Area. These figures do not include the number of students in the Madrasah Ibtidaiyah, Tsanawiyah, and Aliyah Islamic schools. The rapid development of schools in the past 10 years has provided considerable opportunities for the people around the mine to achieve higher education close to their own homes. Tables 5.6, 5.7 and 5.8 also show that the student-school ratio and student-teacher ratio in the Study Area are relatively similar to and in some cases exceed the ratio of the KSB. Except for the Maluk sub-district, the primary school student ratio in the Sekongkang and Jereweh sub-districts is relatively similar to the district level. For the junior and senior high, the student-school, student-teacher ratio is lower compared to district figures, except for the Maluk sub-district where the figures are much higher, due to the high population in the area (PTNNT 2009).



Table 5.6 - Numbers of Schools, Students and Primary School Teachers* (2007)

Areas

Number

of

schools

Student Teacher Student

- school

ratio

Student

- teacher

ratio male female total male female total

Kec. Sekongkang 7 505 487 992 41 38 79 142 13

Kec. Jereweh 6 498 440 938 32 35 67 156 14

Kec. Maluk 4 537 520 1,057 20 23 43 264 25

Kabupaten Sumbawa Barat 84 6,509 5,927 12,436 423 429 852 148 15

Source: Education, Youth and Sport Regional office West Sumbawa district * = not including Madrasah Ibtidaiyah

Table 5.7 - Number of Junior High Schools, Students and Teachers* (2007)

Areas

Number

of

schools


- school

ratio

Student

- teacher


Kec. Sekongkang 3 162 119 281 22 15 37 94 8

Kec. Jereweh 2 148 155 303 13 14 27 152 11

Kec. Maluk 1 146 104 250 8 11 19 250 13

Kabupaten Sumbawa Barat 21 2,229 2,048 4,277 223 188 411 204 10


Table 5.8 - Number of Senior High Schools, Students and Teachers * (2007)

Areas

Number

of

schools


- school

ratio

Student

- teacher


Kec. Sekongkang 1 38 18 56 7 8 15 56 4

Kec. Jereweh 1 171 112 283 12 19 31 283 9

Kec. Maluk - - - - - - - - -

Kabupaten Sumbawa Barat 8 742 671 1,413 107 103 210 750 27


5.4.5 Health

Health service buildings and infrastructure built in the area surrounding the mine have increased since mine construction and operation (Table 5.9). In addition to adequate health service facilities, paramedics are also available in relatively sufficient numbers (Table 5.10). These increases correlate to improved community health quality/conditions, as demonstrated by disease trend data (Table 5.11). In this context, malaria was the most prevalent disease in the community before mine operations. In 2004 and 2006, malaria incidence decreased in the Jereweh puskesmas (health center), while in the Maluk puskesmas the pattern is unclear. The Sekongkang puskesmas, which began operating in 2006, has provided improved health access to the local population who, in the past, had to go to the Maluk puskesmas. Not surprising, the Sekongkang puskesmas has reduced the number of patient visits to the Maluk puskesmas.



Improved health conditions and services in the area surrounding the mine are connected to the contributions by the District Health Office Kabupaten and PTNNT. To improve maternal and infant health, for example, PTNNT has worked with the Yayasan Keluarga Sejahtera Seluruh Indonesia (YKSSI) foundation (later on took over by Lakmus) to facilitate health education seminars, provided additional food through the Center for Maternal and Infant Health as well as established an observation group focused on mother and infant health (PTNNT 2009). Table 5.9 - Total Health Facilities Around the PTNNT Area (2007)

Sub-district Puskesmas Pustu Pustu Polindes Poskestren

Sekongkang 1 5 13 5 1

Jereweh 1 1 15 2 -

Maluk 1 1 9 - 1

Total 3 7 37 7 2

Source: West Sumbawa District health Office, 2007

Table 5.10 - Total Jereweh, Maluk and Sekongkang Puskesmas Workforce (2007) Paramedics Puskesmas

Jereweh Maluk Sekongkang Total

General practitioner 3 3 2 8

Dentist 0 1 0 1

Midwife 11 11 5 27

Hygienist 1 3 3 7

Nurse 17 19 17 53

Pharmacy 1 1 1 3

Nutrition assistant 2 2 1 5

Health analyst 0 1 0 1

Administrative staff 2 6 3 11

Total 37 47 32 116

Source: West Sumbawa District Health Office, 2007



Table 5.11 - Ten Most Common Diseases Suffered by the Population (2004-2006) Puskesmas Jereweh Puskesmas Maluk Puskesmas Sekongkang

Type of Disease Patients Type of diseases Patient Type of Disease Patient

2004 2006 2004 2006 2006*

1. Other Diseases 1,494 1,234 1. ISPA 1,037 822 ISPA 561

2. Upper Tract

Respiratory

Infection (ISPA)

1,239 1,121 2. Diarrhea 915 293 Clinical malaria 488

3. Skin Infection 303 332 3. Skin Infection 689 158 rheumatism 233

4. Rheumatoid

Arthritis

281 293 4. Skin Allergy 638 121 Skin infection 213

5. Diarrhea 234 238 5. Muscle Pain 630 63 Diarrhea 199

6. Allergy 203 221 6. Clinical Malaria 623 129 Skin allergy 143

7. Hypertension 197 197 7. Other Diseases 368 304 accident 146

8. Asthma 195 185 8. Bronchitis 178 69 Conjunctivitis 40

9. Laryngitis 173 153 9. Accidents 95 79 Fungal infection 9

10. Malaria 159 129 10. Gingivitis and

Periodontal

82 41 Others 243

Total 4,478 4,103 Total 5,273 2,079 Total 2,275

Source: Jereweh and Maluk Puskesmas Activity Reports, 2004, 2007

* - Started operation in 2006.

5.4.6 Safety and Security

Study Area communities within the Maluk Police Sector rely upon the Police headquarters in Maluk for security services. In 2008 there were 89 cases reported. This number was reported to be at 63 cases as of August 2009. Of these, 16 cases in 2008 and 5 cases in 2009 were reported to have involved PTNNT. There were no incidents of murder during the periods (Maluk Sector Police 2009).

5.4.7 Infrastructure

Roads

Prior to mine operations, roads connecting the Jereweh sub-district to other areas in the Sumbawa district were, as a whole, inadequate. Similarly, the modes of transportation and number of passengers and goods were limited. The limit on transportation was a prime hurdle to district development, given that much of the population lived in relatively remote areas. Much of the farming produce was taken by horse and cart from several areas into Jereweh. In 1990, there were only 112 motorized bicycles and 4 motor vehicles in the Jereweh sub-district. There was only one outboard motorboat. Buses did transport people between the large cities, but the frequency of bus trips was low. To reach certain areas such as remote Tongo and Sejorong and the south of the sub-district capital, transportation operated only during the dry season.



In 1994, the main road between Jereweh and Alas, the district’s commercial center, was 25 km and paved with "hot mix". Three close villages (Goa, Beru and Belo) were connected by 7 km of asphalted road. Sekongkang Atas and Sekongkang Bawah, being relatively remote, could be reached from the sub-district town of Jereweh through a partially asphalted 17 km road. The 51 km road connecting other villages was still an earth road. At the time of the study (1994), the road was being asphalted to the south of the sub-district capital and it was expected that by late 1995 the asphalted road would reach Sejorong and the Ai’ Kangkung. The quality and number of the roads was improved after mine commencement. A 23 km main access road connects the port of Benete to the mine site and additional road networks in the area include routes to the concentrator, sea water intake system and the townsite (Buin Batu). From 1996 (with the commencement of the Batu Hijau Project) to 2008, PTNNT had facilitated the development and improvement of up to 400 km of roads in the Study Area. In addition, two bus terminals were developed in 2008 within the Study Area (PTNNT 2009 and 2009b).

Sea Port

The sea port at Benete Bay has been constructed by PTNNT to faclicate a number of uses including; concentrate dewatering, filtering and storage, consumable and fuel storage, equipment maintenance, truck assembly and the loading and unloading of equipment and supplies. There are four docks in the Benete port. Two are used as main tethers for the loading of concentrate and off-loading supplies. The other two floating tether docks are used for unloading additional materials such as coal and fuel. The port also serves as a embarking and departure point for the sea plane and the ferry boat servicing the mine area. The government of Indonesia operates a Port of Entry in Benete.

Power Plant and Electricity

As was the case in many other areas in the Sumbawa district in 1994, electricity in the Jereweh sub-district before the mine was very limited. There was a small power station in the capital city of the Jereweh sub-district at the time the mine began. Usually, electricity was switched on at 15:00 until late at night. Only 44 percent of the Jereweh population used electricity at that time. In 1994, a power station was built in Sekongkang Atas to provide electricity for that area. Until the end of 1995, areas such as Sejorong, Tongo, Maluk, Tatar, Singa and the S-1 transmigration settlement had no electricity. In 2006, almost all villages surrounding the mine had a domestic light sources with the exception of Ai’ Kangkung and Tatar villages. In these two villages, some of the inhabitants use generators (Table 5.12). In some villages, electrical generator operations have been assisted by PTNNT. For example, in Tongo, assistance has taken the form of subsidizing monthly operational costs. Every month PTNNT provides free fuel (200 liter per month) for the electric generator in that village (PTNNT 2009). This represents a current monthly subsidy of over US$4,000 (approximately Rp.38,400,000) per month in 2010. The current power station commissioned by PTNNT in the southern portion of Benete Bay is close to the port and concentrate loading dock. The power station consists of four coal-fired, steam turbine generators each capable of providing 28 MW with an additional nine diesel powered generators. Coal is provided to the power plant from the port and is transported from the dock to a stockpile area which is then transported to the power station silo. The power plant provides electricity to the concentrator through a 150 kV transmission network. The transmission system is composed of a 14.4 km long line which runs parallel to the main access road and consists of 39 towers placed at a distances of approximately 300 meters with several



termination structures 10 m in height. A switchyard at each concentrator reduces voltage to 33 kV and 11 kV. The electrical power is the distributed to the mine completed and townsite (Buin Batu).

Water

PTNNT has assisted in the development of a clean water system (piped). In 2005, the PPLH Unram (2007) survey showed that approximately 17 percent of the respondents in 10 villages around the mine used piped water for their daily needs. This percentage increased to 28 percent of respondents in nine villages in 2006. As a result of increased piped water usage, well water usage decreased from 64.8 percent of respondents in 2005 to 56.6 percent of the respondents in 2006. Also, the use of river water has decreased from 1.4 percent of respondents to 0.2 percent during the same year. Several respondents reportedly use bottled water (gallon) as drinking water (PTNNT 2009).

Other Infrastructure Projects

As of 2008, PTNNT had facilitated the development and improvement of various other infrastructure projects including the construction of 13 places of worship, four beach improvement projects, four multi-purposes buildings, and various sporting ground improvements in communities throughout the Study Area (PTNNT 2009b).

5.4.8 Workforce

The workforce in KSB and sub-districts surrounding the Batu Hijau mine area has undergone changes, primarily since 2000. As presented in Table 5.13, the KSB workforce in 2007 comprised 43,037 individuals of which 12,587 (29.2 percent) have senior high school as minimal education level (Table 5.14). These data show that the education level of this workforce has generally increased compared to 1990-1994 conditions. The increased level of workforce education also shown in the increase of the number of workers employed overseas. Data in Table 5.15 show that 53 percent of overseas workers originating from the West Sumbawa District have at least a senior high school level of education, where as approximately 73.6 percent of overseas workers originating from the Sekongkang, Jereweh and Maluk sub-districts have senior high school as their minimum education level (PTNNT 2009).



Table 5.12 - Lighting Sources in Respondent Homes in the Villages Surrounding PTNNT (2003-2006)

Village

Household Lighting

2003 2004 2005 2006

Electricity P’max Oil Lamps Electricity P’max Oil Lamps Electricity P’max Oil Lamps Electricity P’max Oil Lamps

Benete 31 3 3 32 4 1 32 4 1 33 4 1

Maluk 61 5 2 63 0 0 63 4 1 63 4 1

Sekongkang A 50 0 0 50 0 0 50 0 0 50 0 0

Sekongkang B 19 0 0 19 0 0 19 0 0 19 0 0

Tongo Sejorong 23 1 0 23 1 0 23 1 0 23 1 0

SP-I 5* 6 14 5* 10 8 5* 10 8 9* 10 5

SP-II 8* 5 12 8* 7 9 8* 7 9 8* 7 6

Goa 39 0 0 39 0 0 39 0 0 39 0 0

Beru 32 0 0 2 1 0 32 1 0 33 1 0

Belo 31 2 0 31 2 0 31 2 0 31 2 0

Total 296 22 31 302 29 19 302 29 19 308 29 13

Percentage 84.5 6.2 8.8 86.2 8.2 5.4 86.2 8.2 5.4 88.0 8.2 3.8

Source: PPLH Unram, 2003, 2004, 2005, 2006 * Generator



Table 5.13 - West Sumbawa District Population 15 Years of Age and Over by Type of Activity to Previous Week (2007)

Activity

Individuals

Male Female Total

I. Workforce 28,217 14,820 43,037

1. working 28,088 14,273 42,361

2. have worked 39 266 305

3. never worked 90 281 371

II. Non-workforce 5,988 18,150 24,138

school 3,414 2,869 6,283

home duties 1,096 14,329 15,425

others 1,478 952 2,430

Total 35,312 33,327 68,639

Source: Sumbawa Barat Dalam Angka, 2007

Table 5.14 - West Sumbawa District Population 15 Years and Above by Education Level and Sex (2007)

Education Male female Total

Not yet/never been to school 1,108 1,114 2,222

Did not/has not yet graduated primary school 1,927 1,847 3,774

Primary school 11,945 6,105 18,050

Junior high 4,295 2,109 6,404

Senior high 7,856 2,611 10,467

Diploma I/II/III 1,086 1,034 2,120

Total 28,217 14,820 43,037


Table 5.15 - Percentage of Overseas Workers by Completed Education (2007)

Areas Education

Total Primary Junior high Senior high+

Sekongkang - 9 12 21

Jereweh - 45 136 181

Maluk - 23 67 90

Kabupaten Sumbawa Barat 29 1,445 1,670 3,144


In relation to workforce aspects, Batu Hijau mine operations have increased opportunities for the people living around the mine and for the people of KSB and NTB in general (Table 5.16). In the third quarter of 2005, for example, out of 2,775 Indonesian nationals working in PTNNT, 55.3 percent originated from the West Nusa Tenggara province, (20.8 percent from Lombok and 34.5 percent from Sumbawa). The remainder was from outside the province. In addition to PTNNT workers, there were also PTNNT contract workers (Table 5.17): 36.4 percent originated from the



KSB and 30.2 percent from the NTB province. This data is relatively consistent with PTNNT policy which stipulates that some 60 percent of PTNNT or contractor employees must originate from the NTB province with priority given to KSB people, in particular from the three sub-districts close to the mine. The number of PTNNT and contractor employees in quarter 3 of 2005 amounted to 5,584. Table 5.16 - PTNNT Employees by Area of Origin (Quarter 3, 2005) No. Area of Origin Subtotal Total

I Outside NTB 1,240

II NTB province: Lombok: Mataram 322

West Lombok 116

Central Lombok 66

East Lombok 73

577

Sumbawa: Moyo Hilir 8

Ropang 9

Alas 36

Seteluk 37

Taliwang 274

Jereweh/Sekongkang/Maluk 270

Sumbawa Besar 164

Bima 69

Dompu 13

Others 78

958

Total 2,775

Table 5.17 - PTNNT Contractor Employees by Area of Origin (Quarter 3, 2005) Employee Origin Unskilled Semi-skilled Skilled Total

Sumbawa Barat district

Jereweh-Sekongkang 415 94 349 858

Taliwang-Brang Rea-Seteluk 68 35 62 165

Subtotal KSB 483 129 411 1,023

Other areas in NTB

East Sumbawa 235 91 111 437

Lombok 171 51 191 413

Subtotal NTB 889 271 713 1,873

Outside NTB 98 122 716 936

Total 987 393 1,429 2,809



Table 5.18 - PTNNT Employees by Area of Origin (December 2008) No. Area of Origin Subtotal Total

I Outside NTB 1,498

II NTB province: Brang Rea: Sapugara 2

Tepas 24

26

Jereweh: Belo 148

Beru 152

Goa 283

583

Sekongkang: Atas 121

Bawah 54

Sejorong 17

SP I 12

SP II 8

Tongo 54

266

Seteluk: Air Suning 16

Atas 13

Meraran 10

Rempe Bru 2

Rempe Loka 2

Senayan 5

Tengah 33

81

Taliwang: Bangkat M 1

Beru 18

Bugis 41

Dalam 168

Kalimantong 6

Kuang 61

Labuan Llr 18

Menala 77

Mura 13

Sampir 43

446

III KSB Sumbawa: Alas 52

Besar 290

Moyo Hilir 12



No. Area of Origin Subtotal Total

Ropang 4

358

Lombok: Barat 165

Kodya Mat 313

Tengah 86

Timur 112

676

Sumbawa Other:

Bima 98

Dompu 33

Other 85

Total 4,150

Source: Human Resources Data (PTNNT 2009c)

Along with the increase of mining and related activities, PTNNT and contract workforce numbers have increased sharply. In December 2008, PTNNT had 4,212 employees comprising 4,150 nationals and 62 foreigners (Table 5.18). Approximately 64 percent of the workforce originated from NTB (34 percent from the area surrounding the mine). In addition to the above figures, PTNNT contractors employ 4,278 nationals and 65 foreigners, with the largest proportion originating from the local area. With this amount, the total workforce absorbed by the Batu Hijau Project to December 2008 was 8,555 people. It is expected that the total workforce will remain stable throughout operations. As might be expected given the employment numbers above, the unemployment rate in KSB has decreased. In 2002 the unemployment rate was 10.7 percent and in 2006 the unemployment rate was 9 percent.

5.4.9 Local Business Initiative

In addition to direct and contractor employment with the mine, PTNNT developed a Local Business Initiative (LBI) in 2007 with the intention to assist in developing sustainable business with local vendors and businesses and to maximize the opportunity to obtain goods and materials through local sources to benefit the local community. According to the Local Business Initiative (Prakarsa usaha Lokal) procedure (NNT-PUR-000-P022), there are four categories of businesses covered in the LBI program.

Local-Local Business (LLB) is a business that is properly licensed and registered (including for taxation) in Sumbawa with principal business management and supervision carried out by people:

o Who were born in, or who are ethnic inhabitants of, the district of West Sumbawa; o Who possess a current district of West Sumbawa identity card (KTP); and o Who have resided in the sub-districts of Jerewah, Taliwang, Sekongkang, Brang Bea

or Setuluk for a period exceeding three years and whose employees were born in or who are predominately ethnic inhabitants of these sub-districts. These sub-districts now include the Maluk sub-district.



Local Business (LB) is a business properly licensed and registered (including taxation) in NTB with business management and supervision carried out by persons possessing a current NTB KTP and who have resided in the NTB for a period exceeding one year and whose employees were born in or who are predominately ethnic inhabitants of NTB.

National (Indonesian) Business (NB) is a business properly licensed and registered (including

for taxes) in Indonesia with business management and supervision carried out by persons possessing a current Indonesian KTP who reside in Indonesia and whose employees were born in Indonesia.

General Business is a business properly licensed and registered (including for taxes) in

Indonesia or other country of origin with business management and supervision carried out by persons possessing citizenship of the business country of origin.

At the end of 2008, PTNNT had 142 contracts in place in the LBI program. Forty-six (46) percent of those contracts were with Local Local business and accounted for 1,129 employees (26 percent of the total number of LBI employment). Local businesses accounted for 17 percent of the contracts and eight percent of the employment. Indonesian businesses accounted for 52 percent of the contracts awarded and 65 percent of the employment generated by LBI contracts. Less than one percent of the contracts were awarded to General Businesses.

5.4.10 Sources of Livelihood

Sources of livelihood for the population surrounding the mine of Batu Hijau comprise dry field farming (vegetable gardens/fields) and animal husbandry. Fishing and gathering of forest produce are additional sources of income for some of the locals. Mining operations did not only increase employment opportunities in the mine but also increased many opportunities for businesses in the surrounding community. The PPLH Unram (2006) survey report shows that the community work structure around the mine area is quite diverse. Based on a survey of 350 households, it was reported that other than the agricultural sector at 41.1 percent and 6.6 percent relying on fishing, approximately 12.6 percent of the heads of households worked primarily in the service industry, 8.9 percent in trade, 5.7 percent in handicraft, 12.9 percent as private sector workers (including mining), and 12 percent as government employees (PTNNT 2009).

5.4.11 Land Utilization

A report issued by the West Sumbawa District administration states that in 2007 there were 1,308 ha of rice fields in the districts of Jereweh, Sekongkang and Maluk (Table 5.19). Between 2002 and 2006, PTNNT built two reservoirs and four dams which, together, are expected to irrigate 1,310 ha of rice fields in the sub-districts of Jereweh, Maluk and Sekongkang. More of these structures were installed in 2009 to irrigate the 200 ha Murus or impounded system in the sub-district of Jereweh. In order to build these irrigation structures and other community facilities such as health centers, schools, mosques, and community centers. PTNNT has cleared almost 600 ha in the Study Area since 2001, including 98 ha in Jerewah sub-district, 98 ha in Maluk sub-district, and 394 ha in Sekongkang Sub-district. This land is no longer available for agriculture or residential expansion, but the improvements in agricultural production and community facilities has been significant. The construction of reservoirs and dams has increased rice field production to allow for an average of two crops per year. Before irrigation, only one crop was possible because irrigation depended on rainfall. In addition to increasing farming income, the construction of reservoirs and dams has increased land productivity by planting irrigated fields using models of rice-rice-rice, rice-rice-mixed crop or rice-mixed crop (PTNNT 2009).



Table 5.19 - Land Spread by Sub-District and Utilization in Kabupaten Sumbawa Barat (2007)

Areas Land Utilization

Rice field (ha) % Dry land (ha)* % Total (ha)

Kec. Sekongkang 520 1.70 29,983 98,30 30,503

Kec. Jereweh 694 1.58 43,111 98,42 43,805

Kec. Maluk 94 0.66 14,211 99,34 14,305

Sub total 1,308 87,305 88,613

Kab. Sumbawa Barat 9,090 4.92 175,812 95,08 184,902

Source: Sumbawa Barat Dalam Angka, 2007 * = including yards, terraces, fields, grass fields, community forest, state forest, plantations, fish farming ponds.

5.4.12 Farming

PPLH Unram (2006) reported a rice planting increase. In 2005/2006, rice planting activities could only be undertaken in the dry season (third planting season). Sufficient water availability by building reservoirs and dams has increased farming productivity around the mine area. Additionally, rice productivity has been promoted by the development of new techniques and farming systems. In this case, PTNNT has introduced a rice farming system called System of Rice Intensification (SRI) which allows farmers to plant rice even with limited water availability. Although this system has opened opportunities for higher rice production, it has been reported that not many farmers are applying it because of its perceived complicated implementation. Along with the construction of infrastructure that improves farming, PTNNT has also facilitated government activities to develop more commercially oriented agricultural activities. More advanced agricultural technologies have been applied, for example, the use of hand-tractors for land preparation, hand-sprayers to control pests, or other technologies related to harvest processing. Table 5.20 presents farming equipment owned by farmers in the Batu Hijau mine area. Table 5.20 - Development of Farming Equipment Owned by Farmers Around the PTNNT Mine Area (2003 and 2004) Equipment Type Total Equipment Changes

2003 2004 unit %

Hand-tractor 53 135 82 155

Hand-sprayer 215 361 146 68

Huller/RMU 7 9 2 29

Source: Mine Closure Plan (PTNNT 2009)

In addition to rice production and other types of mixed crops, plantation production of coconut and coffee is very important for the NTB province economy, particularly in Sumbawa. While important in Sumbawa, these two commodities have not become important crops generated in the area around the Batu Hijau mine. In 2003, coconut production from around the mine area was 101 ton from a total harvest area of 206 ha. In 2007, coconut production reached 116 ton from a total harvest area of 223 ha. A diversity of plantation crops can be found in the mine area including cassava, creeping beans, chili, pepper, tomatoes, spinach, soy beans, pumpkin etc. Some families plant trees in their courtyards (clove, cocoa, mango, coconut, sour sop, custard apple and lime), and medicinal crops and decorative plants, (including puril, orchids, cordili, ferns, sikas, basil, castor and ginger). Given



Sumbawa’s environmental conditions and soil fertility, the island has a good potential for growing soy bean, peanut, corn, cassava and red chili crops. Village homes’ courtyards are planted with subsistence crops, medicinal and decorative plants, as well as hard wood and fruit trees. Farming activities in the past few years have diversified with the planting of commercial crops such as melons, seedless water melon, mustard greens, mustard white, cabbage, chilies, pepper, tomatoes etc. These types of commercial crops have become important in the agricultural system undertaken by farmers around the mine area. The original PPLH Unram audit discussed the need for PTNNT to provide marketing assistance to farmers so they could maximize their sales; PTNNT responded by providing three community markets within the Study Area. The community surrounding the Project is known for using natural resources from the forest for their timber. The keruwing, kelicung, ipil, rimas, binong, majak, bungur, sauh and sentul trees are the prime source of timber used as raw material for house construction, furniture and other household needs. The former planted area is subsequently turned into a cultivation area, such as fields and mixed crop gardens with hard wood vegetation, such as rattan, which is collected from the forest and sold. The rattan species growing along the rivers is considered to be of higher quality. Gaharu and kelicung are forest trees with high economic potential. “Kayu Api”, firewood, is used as a poison for catching fish and occasionally as a stomachache remedy. These are all endemic species. Specific trees found in these plantations, in addition to coconut and bananas, also include jackfruit, mango, pawpaw, candlenut, aren and coffee. Planting patterns in cleared forest fields usually require intensive care (PTNNT 2009).

5.4.13 Animal Husbandry

Animal husbandry in the original Sumbawa District is still classified as a potential development activity. During the period 1999-2002, PTNNT assisted locals with the provision of 373 cows, 1,848 goats, 6,350 chickens and 4,345 ducks. Table 5.21 shows data of domestic animals owned by locals around the mine in 2002, 2003, and 2007. Data show a substantial increase between 2003 and 2007 in cows, goats/sheep (PTNNT 2009). Table 5.21 - Total Domestic Animals Owned in the Villages Surrounding the PTNNT mine (2002, 2003 and 2007)

Type of Animal 2002 2003 2007

Cow 2,503 2,472 4,307

Buffalo 1,177 1,267 1,061

Goat / Sheep 4,027 4,141 13,789

Horse 684 735 673

Sources: Sumbawa Dalam Angka, 2002, 2003 Sumbawa Barat Dalam Angka, 2007

5.4.14 Fisheries

Sea fishing is still a relatively small scale business in Indonesia. Nonetheless, data in Table 5.22 below shows changes in the number of boats and fishing equipment owned by the fisherman in the Jereweh sub-district since 2001. Following the start of mine operations, locals started fresh water and brackish water fish ponds. Data show that in 2002 in the Jereweh sub-district (which then included the villages in the Maluk sub-district and the Sekongkang Sub-district), there were 24.5 ha of ponds which increased to 30 ha by 2003 (PTNNT 2009).



Table 5.22 - Number of Boats / Fishing Equipment Owned by Jereweh Sub-District Fishermen (2002-2007)

Types of fishing equipment 2001* 2002* 2007**

Boat / Canoe 42 57 13

Outboard Motorboat 28 41 104

Motorboat - - 2

Catching Equipment*** 218 225 213

Sources: * - fishery census, PPLH Unram 2001-2002 ** - Sumbawa Barat Dalam Angka, 2007 *** - Tasik net, flag net, jute, rintak, ulur/ladung, nylon net, spear and tokek.

5.4.15 Handicraft and Home Industry

Before mining operations began in the area, handicraft and home industry were not very visible activities, given their limited marketing power. However, since the mine these activities have increased significantly to 182 households, as compared to 88 in 1995. Household industries have been developing, especially the industries of palm sugar, furniture, bricks and limestone processing. With respect to handicraft and home industries, PTNNT has facilitated the development of several types of home industry products such as the oil industry from Jereweh, tofu making, rattan crafts, etc. PTNNT support has helped to increase the market of these products (PTNNT 2009).

5.4.16 Forest and Forest Products

Before the mine began operations, collection of forest produce represented a small portion of the community economic activities, sufficient only to provide for their subsistence needs. However, since PTNNT mining operations, forest resource utilization activities have decreased. PPLH Unram (2007) reported that 8 individuals identified themselves as forest produce gatherers in 2006. This number has not changed from the previous year. Additionally, locals only engage in forest produce gathering as a secondary activity in their spare time (PTNNT 2009).

5.4.17 Market and Commercial Centers

Prior to mine operations, market activities and commercial trade were relatively minimal. However, since mining began, market and commercial activities have increased in number and frequency. In 2004, there were three traditional markets in Beru, Maluk and Sekongkang Atas, comprising 237 stalls and 67 small shops (Table 5.23) (PTNNT 2009). Table 5.23 - Available Economic Infrastructure in Villages Around the Mine (2004)

Economic Infrastructure Goa Beru Belo Benete Maluk SKK A SKK B Tongo Aik K Tatar

Market - 1 - - 1 1 - - - -

Stall 2 8 3 4 55 7 3 1 1 -

Small shop 23 25 17 10 47 13 10 10 7 7

Bank/credit institutions 1 1 1 - 2 - - - - -

Hotel/lodging - 1 - 2 10 5 4 1 - -

Restaurants/Eating places 1 4 - 2 10 5 4 1 - -

Home industry - 10 2 - 11 4 2 5 - -

Source: Mine Closure Plan (PTNNT 2009)



5.4.18 Banking and Credit Institutions

Community access to banking and formal credit facilities was very limited before PTNNT started to operate in the area. In the past, people borrowed informally from individuals also known locally as “bank rontok” applying interest rates much higher than those applied by formal credit institutions. As compared to formal banking institutions, bank rontoks were easier to access and often lent without collateral requirements. PTNNT has developed a plan of community assistance in the form of revolving funds and several skill training schemes implemented by two foundations supported by PTNNT, namely, Yayasan Olat Parigi (YOP) and Yayasan Pembangunan Ekonomi Sumbawa Barat (YPESB) (PTNNT 2009).

5.4.19 Tourism

Tourism in the sub-districts surrounding the mine does not show any reported increase although the development of the Maluk beach and other places have started to show increased tourist movement, particularly at weekends. To fulfill tourism needs, a number of hotels/lodgings have been developed in the sub-districts of Maluk, Sekongkang and Jereweh (Table 5.24) (PTNNT 2009). Table 5.24 - Hotel Infrastructure Around the PTNNT Mine

Sub-district 2004 2007

Jereweh - 2

Sekongkang 4 3

Maluk 4 4

Source : Sumbawa Barat Dalam Angka, 2004, 2007

5.4.20 Family Income

Family income levels before mine operations showed that approximately 83 percent of respondents reported a monthly income below US$22 (approx Rp.200,000) and 44 percent reported less than US$11 (approx Rp.100,000). Since mine operations, a study of economic, social and cultural development and public health undertaken by PPLH Unram between 2001 and 2007, shows an increase in family income (Figure 7). From 2002 to 2003, for example, the average recorded family income was approximately US$149 (approx Rp.1,340,000) and in 2005 to 2006 average was US$254 (approx Rp.2,283,000). The jobs at the mine and those created ancillary to the mine have improved local incomes. In general terms, improved locals’ income has increased their purchasing power and their welfare. This is reflected, for example, in the consumption and living patterns of the community. Much of locals’ expenditures involve home renovation or home building, purchase of household furniture and motorcycles for transportation. In connection to motorcycle ownership, survey data show that 11 percent of respondents owned a motorcycle by 2006 (PPLH Unram 2007). In relation to local economic development, PTNNT has initiated a Local Business Initiative program to help locals to develop businesses, particularly in the sectors of commerce and services, as described in Section 5.4.9 – Local Business Initiative.

Historic Houshold IncomePT Newmont Nusa Tenggara


Respondent Monthly Income in villages around the mine (IDR)

Respondent Monthly Income in the villages around the mine (US$)

Source: PPLH Unram, 2008

155369

10228351064980

1097306

1340161 1489000

1966000

2283000

2972000

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

1995 2000 2001 2002 2003 2004 2005 2006 2007

67.3

113.6118.3

121.9

157.7165.4

218.4

253.7

330.3

0

50

100

150

200

250

300

350

1995 2000 2001 2002 2003 2004 2005 2006 2007



5.4.21 PTNNT Contributions to the Government

PTNNT activities in Batu Hijau, NTB, both in social and economic terms, have positively contributed to the government and community surrounding the mine. As detailed above, these direct and indirect contributions have been a catalyst for several social changes. The contribution of the PTNNT mine to the government of Indonesia has been in the form of rent on the contract area, corporate income tax, staff income tax (PPH 21), royalty from mineral production, withholding taxes, added value taxes and custom duties. A large portion of the state revenue from taxation is returned to the NTB provincial government and the district of West Sumbawa (approximately 80 percent). Direct corporate contribution to the regional government is in the form of land and building tax, land compensation, and motor vehicle taxes. As presented in Table 5.25 from 1997 to 2007 and throughout 2008, the amount paid by PTNNT to the Indonesian government is estimated at approximately US$855.5 million (1997-2007 / calculated in 2008 US$) and US$468.3 million in 2008 (approx Rp.7.027 and Rp.4.215 trillion). Of these amounts, US$160.9 million (approx Rp.1.448 trillion) have been generated by royalties from the Batu Hijau mineral production from 2000 to 2008 (calculated in 2008 US$). Table 5.25 - Indonesian Government Financial Benefits from PTNNT (1997 – 2007) Type of payment 1997 - 2007 (IDR) 2008 (IDR) 2008 (US$)

Income tax on any kind of benefits:

articles 4,15,23

569,946,874,697 91,945,951,174 10,216,217

Individual income tax – PPh (Income

tax) Psl 21, 26

1,023,260,786,396 168,213,918,925 18,690,435

PPh body - PPh 22 atas Master List

Consumables

216,235,744,258 59,043,694,720 6,560,411

PPh body - PPh 25 2,806,055,842,934 3,570,401,940,299 396,711,327

PPh on interests, dividends and

royalties - pph 26

698,622,506,411 155,347,386,940 17,260,821

PPN payment 197,428,463,489 28,382,229,633 3,153,581

Total Tax Payments: 5,511,550,218,185 4,073,335,121,691 452,592,791

Deadrent 22,540,165,390 2,363,580,000 262,620

Government royalties

(2000- 2008)

1,334,782,976,260 114,112,008,350 12,679,112

PBB 87,005,292,028 19,103,915,093 2,122,657

IMB 7,475,019,805 - -

Underground water 1,822,030,002 193,585,000 21,509

type C mining material 3,718,531,063 - -

Pinjam Pakai forest, IHH, DR, PSDH 16,018,731,294 - -

Port surface water lease 5,600,000,000 700,000,000 77,778

Motorcycle vehicles: PJK, BBNKB 37,470,759,484 5,539,618,900 615,513

Total Non-Tax Payments: 1,516,433,505,326 142,012,707,343 15,779,190

Total Payments 7,027,983,723,511 4,215,347,829,034 468,371,981



In addition to the above benefits, other indirect benefits are realized in the form of salaries, contractors’ payments, purchase of goods and other forms of assistance to the Indonesian government. Between 1997 and 2005, for example, indirect benefits were in the order of US$2.24 billion in 2008 US$ (approx Rp.20.2 trillion) (Table 5.26). Table 5.26 - Indirect Financial Benefits from PTNNT (1997 Q2 - 2005)

Indirect benefits Total (US$) Total (IDR)

wage, salary and other benefits paid to the population

‐ outside NTB 30,891,163 371,203,819,686

‐ NTB 46,336,745 556,805,729,529

‐ KSB 180,198,453 2,165,355,614,835

Payments to Indonesian contractors

‐ outside NTB 1,023,497,456 12,298,862,334,816

‐ NTB 140,730,900 1,691,093,571,037

‐ KSB 115,143,464 1,383,622,012,666

Goods purchase in Indonesia

‐ outside NTB 59,543,034 715,499,169,588

‐ NTB 29,771,517 357,749,584,794

‐ KSB 9,923,839 119,249,861,598

Training and education 23,155,750 278,251,189,290

Regional development/charitable contributions 23,266,660 279,583,938,000

Total 1,682,458,982 20,217,276,825,839

In relation to contributions from PTNNT to the government, LPEM-FEUI (2006) reported that PTNNT activities generated fiscal impacts not only to the KSB but also to the NTB province and the national economy. From 1997-2006, PTNNT contributed some US$402.6 million (approx Rp.4.838 trillion) to the State. Of this total, 45.4 percent (US$182.8 million, Rp.2.197 trillion) were redistributed to the region in the form of transfer. From these transfers, 56.6 percent, or US$103.5 million (approx Rp.1.244 trillion) have been enjoyed by other areas within the NTB province. LPEM-FEUI (2006) also reports that PTNNT dominates the economy of the KSB. With a Gross Domestic Product (GDP) of US$349.5 million (approx Rp.3.32 trillion) in 2000, approximately US$312.7 million (approx Rp.2.97 trillion), or 91.8 percent originated from PTNNT. In 2004, PTNNT contribution reached US$843.8 million (approx Rp.7.58 trillion), or 94.9 percent of the total budget.

5.4.22 Community Profiles in the Study Area

Long-term statistics are difficult to obtain because of the creation of the new administrative areas. Several of the areas did not exist at all when the AMDAL was written, others have grown from hamlets. Following are brief demographic summaries of the main villages in the Study Area based on the 2008 PTNNT Poverty Mapping Survey. These profiles were presented to the communities in December 2009 for validation. In several instances, the participants in the Focus Group Discussion meetings offered alternative values for the parameters measured and presented in the Poverty Mapping Survey. These alternative values and other information obtained from these meetings are presented in the following sections and identified by the citation for Appendix C. The summary of the public meetings is presented in Appendix C in its entirety and summarized in Section 5.5.22.



Maluk sub-district: Benete is the village adjacent to the public port facilities on Benete Bay. The town was not included in the 1994 technical report although it has been a settlement for many years. Folklore is that the Tatarlokas are descendants of the Chinese army that lost the war against Majapahit. The Tatarlokas came down from the mountains in 1974 to Labuan Senutuk, which was a plantation rotation area. In 1977, the village of the Tatarloka people was hit by a tsunami, which caused them to resettle in the Benete area. The area around Labuan Senutuk is now the site of Ai’ Kangkung (SP-I). The Singalokas came down from Arajulu Mountain in 1970. They are currently settled in and around Benete. The Nangkalanungs came down from the mountains in 1979 and settled in Benete. According to a resident, they were the last group to leave the mountains and be resettled by the government (PTNNT 1996). While no population figures for Benete are available pre-mine construction and operation, the 2008 PTNNT Poverty Mapping Questionnaire recorded 396 households in the village with a total population of 1,556 people, almost 4 persons in an average household. The average age of the heads of household was just over 40 years old. In 2008, almost 70 percent of the residences in Benete were classified as permanent because they were constructed of pulverized bricks; just over 8 percent of the homes were classified as ‘emergency.’ Almost 82 percent of the homes were occupied by their owners. None of the residents reported using public sanitation, and over 92 percent of the homes had sanitary facilities in them. Almost three-quarters of the residents received potable water from PDAM/BUMDs and another 25 percent got drinking water from an artesian well. The majority of the survey respondents received medical care from puskesmas (46.7 percent) or private doctors (43.3 percent). According to the 2008 survey, none of the respondents had visited a shaman for health care. According to attendees of the Focus group Discussions, an unknown but substantial number of the residents had visited a shaman for medical care (Appendix C). Benete is now the capital of the Maluk Sub-district and home to the National Port Authority infrastructure. PTNNT built a successful irrigation dam which has increased rice production in the area and manages a nursery for local farmers. Livelihoods in the community vary from being government employees, working at small business concerns, and agriculture to being employees of a mining company. The number of residents who work for PTNNT was combined with Belo and was estimated to be 144 people in the 2008 Survey. Focus Group participants estimated PTNNT employees for this community at 83 people (Appendix C). According to the 2008 Survey, average monthly per capita income also varies but in general is higher than in communities further away from the mine. Of the 383 households that responded to the question on monthly income, over 26 percent earned more than US$389 (approx Rp.3,500,000) and only 2 percent earned less than US$55 (approx Rp.500,000). Sixty percent of the respondents earned between US$55 and US$222 (approx Rp.500,000 and Rp.2,000,000) per month per household. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Benete from 1998 to 2009 by PTNNT included: Road investments: Port road, drainage quick fix - Completed April 1999 Benete-Jereweh road, drainage quick fix / Maintenance - Completed June 1999 Road Realignment - Completed November 1999 Maluk-Benete Boundary Road Paving (3.17 km) - Completed February 2000 Benete-Jereweh Road Paving (10.35 km) - Completed March 2000 Benete Road Paving (2.616 km) - Completed April 2000 Govt. Road Maintenance, Maintenance and Repair Road Jereweh (12.816 km) - Completed

December 2001



Govt. Road Maintenance, Maintenance and Repair Road Jereweh (10.2 km) - Completed October 2002

Benete-Jereweh Road Maintenance (34 km) - Completed July 2004 Benete-Jereweh Road Improvement - Completed July 2005 Light street lamps - Completed December 2005 Road asphalting Benete cross section until police Maluk and Maluk Side Health Center -

Completed July 2008 Tongo Village Road asphalting and road segment Benete, Maluk Sekongkang - Completed

October 2008 Drainage investments: Irrigation Way Sirtu - Completed July 2008 Public Work Phase I (4,092 m) - Completed December 2000 Channels / Drainage Way (3,050 m) - Completed January 2000 Public Work Phase II (2,600 m) - Completed November 2001 Public Work Phase III (1,154 m) - Completed December 2002 Irrigation (Survey and Investigation) - Completed June 2004 Irrigation - Completed September 2005 Irrigation, Phase II - Completed October 2006 Drainage Clearing - Completed February 2007 Irrigation, Phase III (Maintenance) - Completed May 2007 Irrigation Maintenance - Completed March 2008

Other ComDev investments and projects: Water System - Drilling - Completed August 1997 Development of integrated health - Completed June 2000 Water System - Road Access & Tank Pad Site Prep. - Completed September 2001 Elementary School Renovation SDN - Completed October 2001 Water System - Water Tank Construction - Completed January 2002 Water System - Pipe Installation - Started October 2002 Water Reticulation - Completed August 2003 Stage roof at Soccer Field - Completed July 2004 Benete Assessment (River Stabilization) - Completed August 2004 Water Reticulastion - Completed August 2004 Puskesmas Benete Up Grade - Completed September 2004 Beach Facilities - Completed December 2004 Street Lighting Install - April 2005 Electricity PLN, Benete Street Lighting, Soccer Stage - Completed June 2005 Posyandu Benete maintenance - Completed August 2005 Construction of waste disposal landfill Maluk & Benete - Completed September 2005 Kinder Garden - Completed October 2005 New Building SLTP2 - Completed October 2005 Public Kiosk Station Rehabilitation - Completed January 2006 Mosque Renovation - Completed July 2006 Junior Benete (Library + Laboratory), Phase II - Completed September 2006 Floating Dock Development - Completed November 2006 SLTP Benete (New Class Building), Phase III - Completed February 2007 TK Paving - Completed June 2007 SDN Paving - Completed July 2007 Beach Facilities - Completed December 2007 Beach Facilities - Completed September 2008 Junior Development Phase III - Completed December 2008 Clean Water treatment - Completed April 2009



Maluk Loka was not specifically included in the 1994 Technical Report because the whole Maluk area (Maluk Loka and Maluk Mantun) was estimated to contain less than 200 residences. In the course of community Focus Group Discussions, participants indicated that in 1994 Maluk was a hamlet within the Jereweh sub-district with a total population of 124 residents (Appendix C). According to the AMDAL, the original Maluk People came from Perigi Mountain (PTNNT 1996). According to participants in Focus Group Discussions, Maluk settlers were people from Goa, the Sasaks from Lombok and Javanese transmigrants (Appendix C). Little was reported about the economy of Maluk in either the technical report or the AMDAL. The manufacture of rattan furniture for sale began in Maluk in 1995. At least two households were involved in this activity, which was very small scale in nature. In 1994, there was a small pondok or picnic area, in the village of Maluk, as well as a losmen (a hostel). A Jakarta-based company in mid-1995 presented a proposal to the provincial and regency governments to develop a resort in Maluk where the beach area is zoned for tourism development. The most important single tourist attraction is the reputation the southwest corner of Sumbawa Island enjoys as a world-class surfing area. However, because of the virtual absence of visitor facilities, the majority of tourists stay aboard vessels cruising the south coasts of Lombok and Sumbawa. The vessels are based in Benoa (Bali). The normal anchorage in Southwest Sumbawa is Tano Maluk (PTNNT 1996). The Maluk area has grown to be the largest community in the Study Area. According to the 2008 Poverty Mapping survey, Maluk Loka had 512 households with 1,828 people living within them for an average of 3.6 people per household. The average head of household age in 2008 was 39.2. However, according to participants in the Community Focus Groups, Maluk Loka reported 617 households with 2,000 residents with an average household comprised of 4 persons. The average age of the heads of household is 35 years old in Maluk Loka (Appendix C). According to the 2008 Survey, almost 70 percent of the residential structures were classified as semi permanent or permanent; over 30 percent of the housing stock was classified as ‘emergency.’ Unlike the other communities in the Study Area where home ownership was extremely high in 2008, almost 37 percent of Maluk’s residents either rent or board. According to the Focus Group Discussion sources this was thought to be as high as 40 percent (Appendix C). Maluk is a well developed community with over 96 percent of the respondents having private sanitary facilities; all respondents had access to either well water, some of which was provided by a water organization. Over 95 percent of the respondents received medical care from a health center, a doctor or a hospital. Maluk is the economic center of the Study Area with several industrial and manufacturing enterprises. There are two banks in the community and multiple small retail shops and restaurants. PTNNT rebuilt the Maluk market which is open every morning. It is uncertain how many residents or what percentage of the population work for PTNNT. According to the 2008 Survey, almost 50 percent of the households had incomes of less than US$167 (approx Rp.1,500,000). Approximately 22 percent earned between US$167 and US$389 (approx Rp.1,500,000 and Rp.3,500,000) per household per month, and over 28 percent of the respondents earned more than US$389 (approx Rp.3,500,000) per household per month. However, community members attending the Focus Group Discussions reported almost 60 percent of the households have incomes of less than US$167 (approx Rp.1,500,000) per month per household. Approximately 20 percent earn between US$167 and US$389 (approx Rp.1,500,000 and Rp.3,500,000) per household per month, and 20 percent of the respondents earn more than US$389 (approx Rp.3,500,000) per household per month (Appendix C).



According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Maluk from 1998 to 2009 by PTNNT included: Road investments: Maluk Road Penetration Phase I - Completed October 1998 Govt Road Improvement Maluk Hill Realignment (0.3 km) - Completed April 1999 Sekongkang - Maluk Road Paving (7.877 km) - Completed January 2000 Maluk-Benete Boundary Road Paving (3.17 km) - Completed February 2000 Security Jobs Edge Road Sekongkang-Maluk I (Road Barrier)- Completed October 2000 Security Jobs Edge Road Sekongkang-Maluk II (Road Barrier) - Completed January 2001 Sekongkang-Maluk Govt. Road Cut Back - Completed February 2001* Maluk-Sekongkang Brush Trimming - Completed February 2001 Maluk-Sekongkang Road Maintenance (7.5 km) - Completed December 2003 Road Improvement between government Sekongkang Atlas- Maluk (8 km) - Completed April

2003 * - This improvement was noted during community focus group discussions as being a government funded project and not a PTNNT investment. Drainage investments: Main Govt. Road (3,150 m) - Completed October 1999 Public Work Phase I (4,590 m) - Completed December 2000 Public Work Phase II (5,425 m) - Completed October 2001 Public Work Phase III (3,603 m) - Completed June 2002

Other ComDev investments and projects: Elementary School 02 / Rehabilitation SDN 02 - Completed February 1999 Police Station / Development Maluk police - Completed August 1999 Old Police Station (police)- Completed April 2000 Settlement Health Center - Completed May 2000 Elementary School Renovation 01 - Completed June 2000 Temporary Landfill - Completed May 2001 Water System - Drilling - Completed July 2001 Water System - Road Access & Tank Pad Site Prep. - Completed July 2001 Water System - Water Tank Construction - Completed January 2002 Traditional Market - Completed June 2002 Water System - Pipe Installation - Completed December 2002 Water Recirculation - Completed August 2003 Irrigation Feasibility Study, Phase I - Completed November 2004 Maluk Beach, Phase I - Completed December 2004 School Maintenance SD1 & SD2 - Completed June 2005 Puskesmas Maluk Maintenance - Completed September 2005 Maluk Beach, Phase II - Completed September 2005 Lab & Library Building SD02 - Completed October 2005 Landfill Interim Relocation - Completed November 2000

Maluk Mantun was not specifically included in the 1994 Technical Report because the whole Maluk area (Maluk Loka and Maluk Mantun) was estimated to contain less than 200 residences. In the course or community Focus Group Discussions, participants indicated in 1994 Maluk was a hamlet within the Jereweh sub-district with a total population of 124 residents (Appendix C). According to the AMDAL, the original Maluk People came from Perigi Mountain (PTNNT 1996). Maluk settlers were people from Goa, the Sasaks from Lombok and Javanese transmigrants (Appendix C).



The Maluk area has grown to be the largest community in the Study Area. According to the 2008 Poverty Mapping Survey, in Maluk Mantun there were 544 households with 2,009 people in 2008 and the average age of the head of household was 36.3. According to participants in the community Focus Group Discussions, Maluk Mantun had 598 households with 1,893 inhabitants. The average household was comprised of 3.2 persons and the average age of the heads of household is 37 years old in Maluk Mantun (Appendix C). According to the 2008 Poverty Mapping Survey, just over 58 percent of the houses in the community were classified as permanent or semi permanent over 41 percent of the housing was classified as ‘emergency’. However, participants in the Focus Group Discussions indicated that approximately 55 percent of the residential structures are classified as semi permanent or permanent; over 30 percent of the housing stock is classified as ‘emergency’ (Appendix C). Unlike the other communities in the Study Area where home ownership is extremely high, almost 40 percent of Maluk’s residents either rented or boarded according to PTNNT 2008 data. Maluk Mantun is a well developed community with over 90 percent of the respondents having private sanitary facilities; all residents have access to either well water, some of which is provided by a water organization. It is uncertain how many residents or what percentage of the population work for PTNNT. According to PTNNT Survey data, over 46 percent of households had incomes less than US$167 (approx Rp.1,500,000) and almost 22 percent earned between US$167 and US$389 (approx Rp.1,500,000 and Rp.3,500,000). Over 26 percent of households earned more than US$389 (approx Rp.3,500,000) per month. According to participants in the community Focus Group Discussions, almost 60 percent of the households have incomes of less than US$167 (approx Rp.1,500,000) per month per household. Approximately 20 percent earn between US$167 and US$389 (approx Rp.1,500,000 and Rp.3,500,000) per household per month, and 20 percent of the respondents earn more than US$389 (approx Rp.3,500,000) per household per month (Appendix C). PTNNT ComDev investments in this area are present in community profiles for Maluk and Bukit Damai. Bukit Damai is a hamlet of Maluk village which was not specifically included in the 1994 technical report or the AMDAL. According to the 2008 PTNNT survey data, Bukit Damai had 508 households with 1,863 residents with an average population of 3.7 persons per household. According to the Focus Group Discussions, participants estimated 665 households with approximately 3,000 residents, for an average population per household of 4.5 persons (Appendix C). The average age of the heads of household was 37.4 years old in 2008 according to PTNNT data. PTNNT data for 2008 also indicated that over 97 percent of residential structures were classified as semi-permanent or permanent. Forty-seven percent of the respondents owned their own homes and almost 44 percent were living in boarding houses. Five percent of the respondents rented their living quarters. Almost 66 percent of the respondents had private sanitary facilities; an additional 32 percent shared with others. No one reported using the river for sanitary purposes. Over 99 percent of the Bukit Damai respondents report used well water or obtained domestic water from a water organization. Over 66 percent of the respondents received their medical care from the local health center; another 30 percent saw a doctor or used the hospital for medical care. According to participants in the community Focus Group Discussions, 96 percent of the residential structures are classified as semi-permanent or permanent and only forty percent of the population own their own homes. Participants also indicated 60 percent of people either board with another family or rent their accommodations. Participants also indicated almost 80 percent of the respondents have private sanitary facilities; an additional 20 percent share with others (Appendix C).



Livelihoods in Bukit Damai vary from small-scale business holder to being employees of a mine company. It is unknown how many residents of Bukit Damai may work for PTNNT. In 2008, almost 50 percent of the households had incomes of between US$55 and US$167 (approx Rp.500,000 and approx Rp.1,500,000) per month per household. Just over six percent of the respondents earned more than US$389 (approx Rp.3,500,000) per household per month. According to PTNNT records (PTNNT 2009b and 2009d), PTNNT is constructing a village office in Bukit Damai (Appendix C). Pasir Putih was not specifically included in the 1994 Technical Report so no historical population or demographic data is available. According to the 2008 PTNNT Poverty Mapping survey, Pasir Putih has 531 heads of households with 1,892 residents, for an average household size of 3.6 persons. The average age of the heads of household is 36.6 years old. Over 78 percent of the residential structures were classified as semi-permanent or permanent by the PT NNT assessors; 21 percent are classified as ‘emergency.’ Unlike Maluk where renting and boarding are common, approximately 30 percent of the survey respondents own their own homes; over 43 percent of Pasir Putih’s residents either rent or board (Appendix C). Pasir Putih is a well developed community with over 91 percent of the 2008 respondents having private sanitary facilities; almost all of the respondents had access to either well water, some of which is provided by a water organization. Over 99 percent of the respondents receive medical care from a health center, a doctor or a hospital. Livelihoods in Pasir Putih vary from working in small-scale businesses such as food peddler, fish mongers, or driving a motorbike taxi to being employees of a mining company. It is uncertain how many residents work for PTNNT. In 2008, over 35 percent of the households had incomes of between US$55 and US$167 (approx Rp.500,000 and approx Rp.1,500,000) per month per household, while 25 percent earned between US$167 and US$389 (approx Rp.1,500,000 and Rp.3,500,000) per household per month. Just over 22 percent of the respondents earned more than US$389 (approx Rp.3,500,000) per household per month. PTNNT ComDev investments in this area are present in community profiles for Maluk Loka and Bukit Damai. Sekongkang Sub-district: Ai’ Kangkung was originally called SP-1 and is a governmental transmigration community that was developed in 1994 when the Tech Report and the AMDAL were being written. No previous baseline data is available. According to participants in the Focus Group Discussions, the area was settled in 1995 with 190 families. The residents came from:

Bali 50 households East Lombok Timur and West Lombok 50 households Central Lombok 50 households Indigenous people 40 households

Each household was granted two hectares of land per family for agricultural work. While there is a mosque and a madrasah in the village, some of the families are Hindus. Ai’ Betak is a hamlet of the community. Senutuk is a squatter’s village composed of Hindu settlers who work in fishing and agriculture (Appendix C).



The Poverty Mapping Survey completed by PTNNT in 2008 showed that there were 248 households in the Ai’ Kangkung area with a total of 912 residents for an average household size of 3.7 persons. The average age of the heads of household was 42 years old. Over 50 percent of the households were classified as living in ‘emergency’ housing, which had either soil or concrete flooring and bamboo or wood walls. Less than 12 percent of the respondents lived in ‘permanent’ structures made with pulverized bricks. Almost 80 percent of the respondents owned their own homes while 20 percent live with others. Less than 1 percent of the population rented their homes. Members of the community attending the Focus Group Discussions indicated there were 287 households in the Ai’ Kangkung area with a total of 1,014 residents for an average household size of 3.5 persons (Appendix C). Sanitary and water resources reflect the lack of permanency in the housing. Only 41 percent of the residents had private sanitary facilities. The majority of people used public facilities (18 percent) or shared facilities (36 percent). Less than 4 percent of the respondents used the river for sanitary purposes. Less than 1 percent of the respondents reported using the river for drinking water. Almost 97 percent of the survey respondents used well water for drinking purposes. According to the PTNNT Survey data, almost 6 percent of the population had seen a shaman for medical care. A majority of the respondents see a village nurse (43 percent) or go to a health center (51 percent) for medical care. None of the village residents had been to a hospital. Attendees of the Focus Group Discussions reported that approximately 50 percent of the population has seen a shaman for medical care, particularly women for delivery of babies when there are no complications, while approximately 43 percent of the population sees a village nurse and 51 percent report going to puskesmas for medical care. In addition, village residents confirmed none had been to a hospital (Appendix C). Livelihoods in the community vary from agriculture to collecting forest products to being an employee of a mine company. Approximately 12 residents work for PTNNT. The majority of the households (79 percent) had incomes of less than US$167 (approx Rp.1,500,000) per month. Less than 10 percent of the households had incomes of over US$389 (approx Rp.3,500,000) per month. Ai’ Betak contains a windmill and an irrigation office. The community has a clinic provided by PTNNT. There is also a well baby clinic in Senutuk. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Ai’ Kangkung from 1998 to 2009 by PTNNT included: Drainage investments: SP-1 Irrigation (Channel), Phase II - Completed December 2003 SP-1 Irrigation Channel , Phase 2 - Completed September 2005

Other ComDev investments and projects: SLTP SP-1 Rehab. Existing Building (Classroom) - Completed November 2004 Labuhan Posyandu Senutuk - Completed July 2005 Posyandu Ai’ Kangkung , SP1, Tongo - Completed August 2005 Pustu Renovation - Completed March 2005 Pos P3A - Completed August 2005

Sekongkang Atas (upper) was included in the 1994 Technical Report which noted 342 households with a total population of 1,642 residents, an average of 4.8 persons per household. The AMDAL reported that there were 9 small-scale shops/restaurants in Sekongkang Atas. Local residents also collected honey, rattan, wood/firewood, palm sap, and other forest products from the surrounding forests. Many inhabitants earned their living from forest products, particularly those of Tongo, Sejorong, Sekongkang Atas, and Sekongkang Bawah (PTNNT 1996 and Dames & Moore 1995).



The 2008 PTNNT Poverty Mapping Survey reported a total of 470 with 1,799 residents in Sekongkang Atas with an average household size of 3.8, significantly smaller than in 1994. The number of households has increased from 1994 to 2008 by 37 percent, or 2.7 percent growth per year. The population of this community has increased by 12 percent for the same period (less than 1 percent per year). The average age of the heads of household was reported to be 42.5 years old. Community members attending the Focus Group Discussion reported 518 households with 2,373 residents in the village, an average household size of 4.6. Utilizing these values, the number of households increased by 51 percent, or 3.4 percent growth per year since the mine was authorized. According these figures, the population increased by 44.5 percent (less than 3 percent per year), indicating increased income that allows families to own their own homes (Appendix C). According to PTNNT 2008 data, almost 70 percent of the homes were classified as semi-permanent to permanent. Almost 90 percent of the respondents either owned their own homes or lived with a home owner. Almost 10 percent of the respondents board with another family. Eighty-eight percent of the respondents had their own or share sanitary facilities with another family. Less than 4 percent of the respondents used the river for sanitary purposes. None of the respondents used the river for drinking water. Almost all of the residents get their water from wells or water organizations. Approximately 75 percent of the respondents have received health care from the village nurse, the health center (puskemas), a doctor, or gone to the hospital. Twenty-four percent have received health care from a shaman. Livelihoods in the community vary from collecting forest products to owning small businesses to being employees of a mine company. Approximately 119 residents work for PTNNT. Over 55 percent of the survey respondents had per household monthly incomes under US$167 (approx Rp.1,500,000); just over 16 percent of the respondents earned more than US$389 (approx Rp.3,500,000) per household per month. PTNNT has developed a market which is open from 7-9 am every morning in Sekongkang Atas. The market is not as successful as it could be because it competes with the market in Maluk which draws more customers. PTNNT also built an irrigation dam and helped establish a company which makes and distributes building block. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Sekongkang Atas from 1998 to 2009 by PTNNT included: Road investments: Road Improvement Between Sekongkang Atlas - Maluk (8 km) - Completed April 2003 Street lighting lamps - Completed December 2005

Drainage investments: Channels / Drainage Sekongkang Atas-Bawah (3,000 m) - Completed July 1999 Irrigation Channel - Completed August 2000 Public Work Phase I (2,465 m) - Completed December 2000 Public Work Phase II (593.5 m) - Completed June 2002 Drainage & Road Up Grade (366 m) - Completed August 2004

Other ComDev investments and projects: Water Well Drilling - Completed August 2000 Water System - Road Access & Tank Pad Site Prep. - Completed April 2001 Water System - Drilling - Completed June 2001 Water System - Water Tank Construction - Completed January 2002 Water System - Pipe Installation - Completed 2003



Water Recirculation - Completed August 2003 River Stabilization (Gabion Install) - Completed December 2003 River Stabilization (Gabion Fabricated) - Completed October 2004 Community Health Center Facilities - Completed May 2005 Water Facility Up Grade (purchase materials) - Completed July 2005 Pos P3A - Completed July 2005 Soccer Stage - Completed July 2005 River Stabilization ( Completion ), Phase 2 - Completed July 2005 Town Symbol - Completed August 2005 Pustu Renovation - Completed November 2005

Sekongkang Bawah (lower) is the capital of the Sekongkang Sub-district and was included in the 1994 Technical Report which listed a total population of 436 inhabitants living in 98 households for an average household size of 4.4 persons. According to the AMDAL, there were 4 small-scale shops/restaurants in Sekongkang Bawah in 1994. These shops likely sold smoked fish and other needs such as soap, toothpaste, shampoo, cooking oil, instant noodles, wheat, etc. In 1994, there was not a market in Sekongkang Bawah and person living in Sekongkang Bawah likely went to Taliwang to obtain goods to satisfy their household needs. Many inhabitants of Sekongkang Bawah earned their living from forest products in 1994 (PTNNT 1996 and Dames & Moore 1995). The 2008 PTNNT Poverty Mapping Survey found that Sekongkang Bawah had 286 households containing a total of 1,135 inhabitants, just under an average of 4 persons per household. The average age of the heads of household was reported to be 38 years old. A majority of houses were of permanent construction, in good condition, and owned by the residents. Over 70 percent (207 houses out of a total of 286) contained sanitary facilities and 203 of the houses had access to PDAM/BUMD water supply organizations. Almost 93 percent of the respondents reportedly had seen the village nurse (1.6 percent), the local health clinic (87.9 percent), or a doctor (3.2 percent) for medical care. Focus Group Discussion participants reported 230 households containing a total of 901 inhabitants, just under an average of 4 persons per household (Appendix C). Livelihoods in the community vary from collecting forest products, working in small businesses, to being an employee of a mine company. Approximately 54 residents work for PTNNT. The majority of the households (64 percent) had incomes of less than US$167 (approx Rp.1,500,000) per month per household. Sixteen percent of the households had incomes of over US$389 (approx Rp.3,500,000) per month in 2008. PTNNT has made significant infrastructure investments in Sekongkang Bawah including several schools (junior high, senior high and a dormitory for resident students from other villages without a high school), a pushemas (a community health center), a multipurpose hall, and an experimental permaculture center to identify new crops including health botanicals. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Sekongkang Bawah from 1998 to 2009 by PTNNT included: Road investments: Road Widening Improvement Govt. Road Government (1.2 km) - Completed February 2000 Road Improvement Between Government Sekongkang Bawah-Tongo (13 km) - Completed

April 2003 Road Improvement Between the Government of Sekongkang Bawah-Tongo (9 km) -

Completed April 2003 Street lighting lamps - Completed December 2005



Drainage investments: Channels / Drainage Sekongkang Atas-Bawah - Completed July 1999 Channels / Drainage - Completed May 2000 Public Work Phase I (1,543 m) - Completed December 2000 Public Work Phase II (347 m) - Completed January 2002 Drainage (JSS Beside SKG) - Completed August 2004

Other ComDev investments and projects: Water System & Tank Access Road Pad Site Prep. - Completed April 2001 Water System - Drilling - Completed June 2001 Water System - Water Tank Construction - Completed January 2002 Water System - Pipe Installation - Continued in 2003 Water Recirculation - Completed August 2003 Maintenance SLTP - Completed July 2005 Health Post New Building - Completed September 2005 Soccer Stage - Completed July 2005

Tatar, originally called SP-2, is a transmigration village developed after 1994. Therefore, no previous baseline data is available. The 2008 PTNNT Survey recorded 156 households with a combined population of 623 persons, an average of 4 persons living in each household. The average age of the heads of household was 41.8 years old. The 2008 survey indicated almost 78 percent of the respondents lived in semi- permanent to permanent homes in Tatar and the surrounding hamlets. Over 75 percent of the respondents owned their own homes while another 22 percent lived with others. Seventy-four percent of the respondents had their own sanitary facilities or shared with others, 24 percent of the respondents used public facilities, and approximately 2 percent reportedly used the river for sanitary purposes. Over 86 percent of the respondents used springs for water, while another 13 percent used well water. There are no water organizations in the community. Ninety-three percent of the respondents used the health center for their health care. Community representatives in attendance at the Focus Group Discussion reported that almost 74 percent of the population lived in semi- permanent to permanent homes in Tatar and the surrounding hamlets. Twenty percent have their own sanitary facilities. The remainder use public or shared facilities. Representatives also indicated that the population use both groundwater and well water (Appendix C). According to the 2008 survey data, 93 percent of the respondents used the health center for their health care. According to Focus Group Discussion participants, approximately 50 percent of the residents go to shamans for medical care and 50 percent used the puskesmas for their health care (Appendix C). Livelihoods in the community vary from agriculture (farming and raising livestock) to collecting forest products to being employees of a mining company (Appendix C). Approximately 8 residents work for PTNNT. The majority of the households (90 percent) had incomes of less than US$167 (approx Rp.1,500,000) per month. Approximately 55 percent earned less than US$55 (approx Rp.500,000) per household per month. No respondent household in the 2008 survey earned more than US$389 (approx Rp.3,500,000) per month. There is an experimental farm (agricultural demonstration plot) in Tatar (PTNNT financed) which is being used to teach farmers better agricultural techniques. Newmont has constructed a water tank in the area to provide potable water to the community and a new school, also financed by PTNNT.



A new bridge is being constructed on the coastal highway to the east of the community (Japanese investment and construction workers). According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Tatar from 1998 to 2009 by PTNNT included: Road investments: T. Site Intersection - Road maintenance, mayor repair / priority road - Completed

September 2003 Tongo-SP2 Road Maintenance - Completed October 2004

Drainage investments: Rump Pump Study, SP2 - Completed August 2005 SP2 Irrigation Construction - Completed December 2002

Other ComDev investments and projects: Primary School Rehabilitation SP I & SP2 - Completed December 2002 Total Rehab School SD 03 Tongo Phase II - Completed September 2005 Pos P3A, Tatar - Completed August 2005

Talonang Baru Village is a recently developed transmigration village (SP-3). Developed in 1995, the village is isolated and quite far from the mine site by bad road. There is no 1994 baseline information for this community. The Poverty Mapping exercise conducted by PTNNT in 2008 found 260 households with 937 residents, or 3.6 persons per average household lived in Talonang Baru Village. The average age of the heads of household was 42.4 years of age. Less than 1 percent of the residential structures in Talonang Baru Village were classified as permanent; over 60 percent were classified as ‘emergency.’ Almost 75 percent of the households owned their own residences; 25 percent lived with others who did own their own homes. Almost 37 percent of the respondents report using the river for sanitary purposes; 17 percent used public facilities and just over 45 percent had access to private or shared facilities. Over 94 percent of the respondents had access to well water; less than 3 percent obtained drinking water from the river. Almost 98 percent of the respondents receive their medical care from a village nurse. Livelihoods in the community include agriculture, collecting forest products such as honey and rattan, and hunting (Appendix C). It is uncertain if any residents work for PTNNT. The majority of the households (almost 99 percent) had incomes of less than US$167 (approx Rp.1,500,000) per month per household with 64 percent of those having per month per household incomes of under US$55 (approx Rp.500,000). No one in the Talonang Baru Village earned more than US$277 (approx Rp.2,500,000) per household per month in 2008. According to PTNNT ComDev historical records, Environmental Management and Monitoring Implementation Report for 2008 and the ComDev Activity Report for 2007 & 2008, PTNNT has not made any investments in or near this community. Tongo is one of the primary villages in the Study Area and was included in the 1994 technical report and AMDAL although no specific population, household or density data was presented. As the Tongo, Sejorong and Tamalang settlements are more or less contiguous, they are now known as Tongo Village. Per the AMDAL, the Tongos (about 40 families) came down from Batumunguk Mountain in 1943 in response to orders by the Japanese authorities to relocate so that they could live closer to their work area. Eventually, the Tongos moved to the area now known as Dusun Tongo neighboring Sejorong



Village. Since the Dutch came to Sekongkang Atas in 1920, Dea Maning (descendants of Sumbawa aristocrats), together with other aristocrats, fled and settled in the Sejorong River area where they have remained. They call their settlement area Sejorong village, and they call themselves the Sejorong People (PTNNT 1996 and Dames & Moore 1995). Tongo Tamalang is a new village composed of residents who migrated from Lombok, primarily agricultural workers. They were granted land adjacent to the existing village of Tongo. Transmigration is still occurring because there is still a large area of uncultivated agricultural land in the district, resulting in a significant number of outsiders coming in search of opportunities. The inhabitants of Kecamatan Jereweh collect honey, rattan, wood/firewood, palm sap, and other forest products from the surrounding forests. Construction materials and rattan are the most important. Many inhabitants earn their living from forest products, particularly those of the Tongo villages. A fairly large rattan collection operation has been established in Benete (Dusum Singa). A certain amount of illegal logging occurs, particularly in the southern part of the district around Sejorong-Tongo. The wood is loaded on small motor vessels in Teluk Senutuk and shipped to Lombok. Little information was available on this activity, as presented in the AMDAL (PTNNT 1996 and Dames & Moore 1995). In 1994, as reported in the AMDAL, nearly 75 percent of the residents of Tongo-Sejorong cultivate wet rice fields (sawahs). People in this area harvested rice only once a year because the source of water was as yet inadequate. The rice fields dry up in the dry season (PTNNT 1996 and Dames & Moore 1995). The Poverty Mapping Survey conducted by PTNNT in 2008 recorded 320 houses in the Tongo area with 1,270 total residents, an average household size of 4 persons. The average age of the heads of household was 39.2 years of age. In 2008, almost 98 percent of the respondents owned their homes (68 percent) or lived with others (30 percent). Almost 80 percent of the housing in Tongo is classified as semi-permanent to permanent. PTNNT had provided money to rehabilitate 75 existing houses in the town to appease jealousy from residents who do not work at the mine. Only 62 percent of the respondents had their own sanitary facilities; almost 20 percent used the river and 15 percent used public facilities. In contrast, almost 81 percent of the respondents obtained drinking water from water organizations or wells (14 percent). There were 411 responses concerning where people get health care services: over 56 percent go to the Puskesmas (health center); 33 percent see a village nurse; and over 10 percent use a shaman for health care service. Approximately 53 residents work for PTNNT. Agriculture is a primary occupation and some residents work in shops or collect forest products. The household income range reinforces the range of occupation. According to the Poverty Mapping Survey, 72 percent of the respondent households reported earning less than US$167 (approx Rp.1,500,000) per month. There was a small middle income group in 2008, and over 13 percent of the respondent households earned US$389 (approx Rp.3,500,000) per month. Focus Group Discussion participants reported that 72 percent of the households earn less than US$55 (approx Rp.500,000) per month by those attending the meeting (Appendix C). PTNNT has made several major investments in the town including building a health facility, a public school, a madrasah, a new mosque, and a large multi-purpose community hall. There are many new brick houses and several more under construction. PTNNT built the school and the clinic but the government provides the teachers and medical staff.



PTNNT provides a generator (and the gas to run the generator) to the community, the only community with electricity. PTNNT has also built a reservoir near Tongo to provide irrigation during the dry season allowing two rice crops a year. Tamalang has a YOP micro-financed store near the entrance to the marine tailings yard. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Tongo from 1998 to 2009 by PTNNT included: Road investments: Tongo/Sejorong Village Road Improvement - Completed November 2000 Township-Tongo Sejorong Govt. Road Maintenance (14 km) - Completed February 2001 Govt. Road Maintenance, Repair Province Road Junction Townsite - Tongo - SPI / II (20 km)

- Completed December 2001 Road Improvement Between Government Sekongkang - Tongo (14.7 km) - Completed April

2003 Road Improvement Between Government Sekongkang Bawah - Tongo (13 km) - Completed

April 2003 Road Improvement Between the Government of Lower Sekongkang - Tongo (Stone Rea-

Tongo)(9km) - Completed April 2003 Farmers Ai Road Improvements Brunei Tongo (1.3 km) - Completed September 2003 Tongo Road Construction (14 km) - Completed December 2003 Bridge repair Gorong Tongo-country road Sekongkang - Completed April 2004 Sekongkang - Tongo Road (Bush Trimming) (15 km) - Completed May 2004 Tongo-SP2 Road Maintenance (12 km) - Completed September 2004

Drainage investments: Public Work Phase I - Completed December 2000 Public Work Phase II - Completed July 2002 Tongo Sejorong Irrigation Survey - Completed October 2002

Other ComDev investments and projects: Development of integrated health facility Tongo / Sejorong - Completed June 2000 Sejorong/Tongo Water Operation - Completed October 2000 Elementary School Renovation 01 Sejorong - Completed December 2001 Tongo-Sejorong Water Recirculation - Completed August 2003 Soccer Stage - Completed August 2004 Townhall at Puja Embung - Completed August 2004 New health clinics - Completed February 2005 Health post Ai’ Kangkung and Tongo - Completed August 2005 Total Rehab Elementary School 03 Tongo Phase II, SP2 - Completed September 2005 Pos P3A - Completed November 2005

Buin Batu was created by PTNNT as a condition of the Contract of Work and is on file with the Sekongkang Sub-district office as a “Spatial Plan” which must also guide closure activities. Indonesian citizens living in the town vote in all elections; Buin Batu is their legal residence. Approximately 2,200 people live in the barracks with an additional 800 people living in 300 single family, duplex, and apartment units. Construction of the town began in 1998 and the last 13 houses were built in 2003. There are two schools in Buin Batu, a primary and a junior high serving approximately 300 students. Senior high students generally leave Sumbawa in order to attend school. PTNNT built a mosque in Buin Batu to serve the spiritual needs of miners and administrative workers. In addition, the Company constructed a library, billiard room, gym, internet café, multipurpose building with a band



room, multiple parks and playing fields, outdoor theater, swimming pool, tennis courts, club house and driving range, and golf course. Buin Batu also has a drop-in clinic and a full-time ISOS health clinic with an emergency/trauma room. The town has two stores and a commissary which cater to administrative / management workers who have their own kitchen facilities and an employee cooperative which caters to the needs of workers who live in the barracks. Between 52,000 and 55,000 meals are served each week at two messes and via pack meal for workers operating remotely. Workers are entitled to three meals a day; four meals a day are available to any worker on a 12+ hour shift. The PTNNT Facilities and Services Department maintains a water treatment plant and distribution lines, a waste water treatment plan which recycles domestic grey water to the golf course, dust control, and irrigation. Electricity from the power plant at the Benete Port is used in Buin Batu; the equipment is expected to last through life-of-mine. There is an emergency early warning system for natural disasters such as earthquake and tsunamis. Jereweh sub-district: Belo is one of the communities in the Jereweh Sub-district that was examined in the 1994 Technical Report. Approximately 2,546 people lived in 476 households for an average population per household of 5.3 persons. The AMDAL reports that there were 16 small-scale shops/restaurants in Belo in 1994 (PTNNT 1996 and Dames & Moore 1995). The 2008 PTNNT household survey recorded 576 households with a combined population of 2,148 persons, an average of 3.7 persons per household. This represents a decline in household size since the construction and operation of the mine. The number of households grew by 21 percent while the population actually declined. Over 90 percent of the residential structures surveyed in the PTNNT 2008 Poverty Mapping Survey were reported to be semi-permanent or permanent (with concrete floors). Almost 83 percent of the respondents to the survey owned their homes; another 17 percent shared with homeowners. Almost 74 percent had their own sanitary facilities but a disturbing 23.5 percent used the river which potentially impacts the health of all community members. Over 97 percent of the respondents obtained water from a well or a water organization. Less than 3 percent used water from the river. The majority of respondents received medical care from the local health center, and 20 percent reported being seen by a doctor. Livelihoods in the community vary from collecting forest products to being employees of a mine company. The number of residents who work for PTNNT when combined with the community statistics for Belo is estimated to be less than 144 people (Appendix C). Average monthly income also varied, but in general was higher than in communities further away from the mine. Of the 553 households that responded to the question on per family monthly income, over 77 percent earned less than US$167 (approx Rp.1,500,000), 9 percent earned more than US$389 (approx Rp.3,500,000) per month per family. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Belo from 1998 to 2009 by PTNNT included: Road investments: Farming Road Improvement - Completion in 2009

Drainage investments: Public Work Phase I (1,474 m) - Completed November of 2000 Public Work Phase II (1,588.7 m) - Completed November 2001



Drainage Phase III (1,750 m) - Completed July 2003 Drainage and Road Maintenance (1,750 m) - Completed September 2004 Village Drainage Channel Development (continued) - Completed August 2005 Irrigation - Completed October 2006 Irrigation Weir, Channel / Pad Preparation, Hydrologic Survey - Completed October 2007 Irrigation, Phase II - Completed October 2008 Irrigation, Phase III - Started in June 2009

Other ComDev investments and projects: Village Garbage Truck Procurement (Beru, Belo and Goa), Garbage collection - Completed

April 2005 Health Building - Completed July 2005 Total Rehab School SD 02 - Completed August 2005 Village Women’s House Rehabilitation - Started August 2005 Shelter Development / Football Field - Completed December 2005 Women’s House Rehabilitation, Phase II - Completed October 2006 SDN Education Building Fencing - Started in 2006 SDN Education Building Paving Phase II - Completed March 2007 Making Public Podium - Completed June 2008 Houses of Worship (musholla) / Public Places - Completed April 2009 Library Building SMU Jereweh - Completed September 2005 (Appendix C) Development of MTS - Completed June 2008 (Appendix C) Landfill Expansion - Completed April 2009 (Appendix C)

Beru was included in the 1994 Technical Report, which listed a total of 2,192 persons living in 480 households, or 4.6 persons per average household. According to the AMDAL, a lime kiln complex has operated in Beru for some 20 years with much of the lime shipped to Atas. There was a traditional market in Beru consisting of four shops and 26 small-scale shops/restaurants. The district market in Beru (essentially, the district capital) began operations in early 1994. The existence of the market allowed farmers to gain additional cash income by selling their surplus crops (PTNNT 1996 and Dames & Moore 1995). The 2008 PTNNT survey recorded 802 households in Beru with a total population of 2,921, an average household size of 3.6 persons, which represented a sharp decrease in population per household size since 1994. The number of households grew by 67 percent from 1994, while the population only increased by 33 percent. The 2008 PTNNT Poverty Mapping Survey also reported that all residential structures in Beru are semi permanent to permanent. Over 84 percent of the structures are owned by the residents with another 14 percent living with other home owners. Over 86 percent of the respondents have their own or share sanitary facilities; just over 11 percent use the river and 2 percent use public facilities. Only 2 percent of the respondents got water from the river; the rest of the respondents obtained water from wells or a water organization. Over 52 percent of the residents get medical care from the local puskesmas and over 30 percent have access to a doctor. Livelihoods in the community vary from collecting forest products to being employees of a mine company. Approximately 113 residents work for PTNNT (Appendix C). Approximately 68 percent of the respondents have per family monthly incomes under US$167 (approx Rp.1,500,000); almost 13 percent earned more than US$389 (approx Rp.3,500,000) per family per month. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Beru from 1998 to 2009 by PTNNT included:



Drainage investments: Public Work Phase I (1,912 m) - Completed November of 2000 Public Work Phase II (1,913.6 m) - Completed November 2001 Drainage Phase III (1,750 m) - Completed October 2003 Drainage and Road Maintenance (1,750 m) - Completed September 2004 Village Drainage Channel Development (383 m) (continued) - Completed August 2005

Other ComDev investments and projects: Beru SD Jereweh, Up Grade - December 2004 Village Garbage Truck Procurement (Beru, Belo and Goa), Garbage collection and landfill -

Completed April 2005 SLTP 1 Rehab. Phase II - Completed September 2005 Upgrade Jereweh health center - Completed November 2005 Jelenga Toilet (1 unit) - Started July 2006 Puskesmas Jereweh Up Grade + Furniture, Phase II - Completed - September 2006 Posyandu (Health Building) - Started August 2006 Puskesmas Jereweh Up Grade + Furniture, Phase III - Completed December 2007 SMAN Jereweh Fencing + Landscape - Started June 2006 SMPN I Jereweh Up Grade - Started April 2006 Beru SD Construction - Completed August 2006 Renovation Works SDN Jereweh - Completed February 2007 Kinder Garden (2 units : TK PGRI dan SDN Beru) - Completed December 2007 SMAN Jereweh Phase III (Teachers Office) - Completed February 2008 SDN Jelengah Up Grade - Completed December 2008 Fences TK & SDN PGRI 01 Paving - Completed August 2008 Junior Library - Completed November 2008 SDN Maintenance 2 Unit - Completed May 2009 Soccer Field Fence - Completed July 2009 Maintenance Market - Completed August 2009 Fence SDN Jelenga - Completed October

Dasan Anyar was not included as a separate village in the AMDAL; its households and population were included with that of Goa. During the 2008 PTNNT Poverty Mapping Survey, interviewers noted 337 heads of household in the Dasan Anyar community with a corresponding total population of 1,251, an average population per household of 3.7 persons. Almost 30 percent of the residential structures were classified as ‘emergency’ with only 52 percent classified as permanent. Seventy-eight percent of the respondents own their own homes; 21 percent reported that they live with a home owner. Over 50 percent of the respondents had their own sanitary facilities; 24 percent used public facilities and less than 10 percent used the river. Over 96 percent of the respondents obtain domestic water from wells or water organizations. Over 85 percent of the respondents get their health care from village nurses, the local Puskesmas, or doctors. Almost 14 percent reported visiting with a shaman for health care. Livelihoods in the community include agriculture and collecting forest products. It is not certain how many residents of this community may work for PTNNT. Approximately 71 percent of the respondents have per household monthly incomes under US$167 (approx Rp.1,500,000); just over 11 percent earn more than US$389 (approx Rp.3,500,000) per household per month. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Dasan Anyar from 1998 to 2009 by PTNNT included:



Drainage investments: Public Work Phase I (1,203 m) - Completed November of 2000 Additional, Public Work Phase I (600 m) - Completed December 2000 Public Work Phase II (600 m) - Completed November 2001 Channel Irrigation / Drainage Phase III (2250 m) - Completed October 2003 Irrigation Tereng and Lang Lang Kunam - Completed April 2005 Irrigation Lang Jorok - Completed August 2009

Other ComDev investments and projects: Primary School Rehabilitation foundation Jereweh - Completed February 2004 Kinder Garden - Completed October 2005 Posyandu (Integrated Health Services Station) - Completed October 2008 SDN Maintenance - Completed August 2009

Goa was included in the 1994 technical report and the AMDAL. The technical report indicates that in 1994, a total of 2,478 people lived in 585 households in Goa, or 4.2 persons per household. According to the AMDAL, there were 22 small-scale shops/restaurants in Goa in 1994. Small shops sell smoked fish and other needs such as soap, toothpaste, shampoo, cooking oil, instant noodles, wheat, etc (PTNNT 1996 and Dames & Moore 1995). According to the 2008 PTNNT Poverty Mapping Survey, Goa had 380 households containing 1,389 people. The lack of apparent growth is misleading because Dasan Anyar was a hamlet of Goa in 1994. Today it is a separate village with its own community profile (see above). Ninety-seven percent of the residential structures in Goa were reported to be semi-permanent or permanent (those with permanent floors) by the 2008 PTNNT Poverty Mapping Survey. Over 98 percent of the units were owned by the residents or shared. Over 95 percent of the respondents had their own or share sanitary facilities; less than 4 percent of the respondents used the river. Over 99 percent of the respondents got drinking water from wells or a water organization. Eighty-one percent of the respondents used the local clinic for their health needs and 17 percent had seen a doctor. Livelihoods in the community vary from collecting forest products to being employees of a mine company. Approximately 60 residents currently work for PTNNT (Appendix C). Almost 68 percent of the respondents earned less than US$167 (approx Rp.1,500,000) per family per month; over 15 percent earned more than US$389 (approx Rp.3,500,000) per family per month. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Goa from 1998 to 2009 by PTNNT included: Road investments: Bridge Quick Fix (30 m) - Completed February 2001 Fence Road Circle and the field - Completed July 2009 Farming Road Improvement (6 km) - Completion in 2009

Drainage investments: Public Work Phase I (695.5 m) - Completed November of 2000 Public Work Phase II (1,004.8 m) - Completed November 2001 Public Work Phase III (1,750 m) - Completed October 2003 Drainage and Road Maintenance (1,750 m) - Completed December 2004 Development of irrigation channels "lang kunam" foundation and drainage of the village

(continued) - (837 m) - Completed August 2005



Other ComDev investments and projects: Village Garbage Truck Procurement (Beru, Belo and Goa), Garbage collection and landfill -

Completed April 2005 Soccer Stage - Completed July 2005 SDN Education Building Up Grade - started May 2006 SDN Education Building Paving - Completed December 2006 Health Building - started July 2006 SDN 1 Education Building Fencing, Wash Tape and New Toilet For Teachers, Completed

December 2007 District Border Gate - Completed November 2007 Multipurpose Building, Government Office Stage and Shelter - Completed November 2008 Installation of Landmark Monument - Completed 2008 Soccer Field Fence, Multipurpose Building, Government Office Stage and Shelter -

Completed July 2009

5.4.23 Stakeholder Meetings

AMEC Geomatrix hosted four community Focus Group Discussion meetings between 6 and 12 December 2009 as part of the Social Impact Assessment in order to verify baseline data directly with community representatives and to better understand community issues and concerns. Meetings were held with clusters of communities at four locations: The Cluster 1 meeting was held in community center in Tongo Village and included representatives from four villages under Sekongkang sub-district administration:

SP 1/Ai’ Kangkung SP 2/Tatar

SP 3/Talonang Baru Village Tongo

The Cluster 2 meeting was held in Sekongkang sub-district’s office in Sekongkang Bawah Village and included two villages under Sekongkang sub-district administration:

Sekongkang Bawah Sekongkang Atas The Cluster 3 meeting was held in the Maluk Community Center and included representatives of four villages under Maluk sub-district administration:

Benete Bukit Damai

Maluk (Mantun and Maluk Loka) Pasir Putih

The Cluster 4 meeting was held in community center in Goa and included representatives of four villages under of Jereweh sub-district administration:

Belo Beru

Dasan Anyar Goa

The participation rate in each location was high with about 70 to 90 percent of the people invited in attendance, but participation by women was low at between 7 to 20 percent. A full list of participants and all impacts are included in Appendix C. Each meeting followed the same agenda: introduction, a briefing on the SIA process, baseline data verification, and a discussion on condition before and after the mining, impacts, and expectations for the future. In general, people verified the data presented, noting only some minor mistakes, for example on the name of the villages, total households/residents, percentage number of people’s income, people’s way for medical care: modern vs. traditional, home ownership, sanitary facilities, etc. They also



verified PTNNT investment data for the community, but asked that infrastructure that was part of PTNNT facilities be excluded from “community investments”. Participants generally acknowledged the PTNNT investment in the area and appreciated the positive impacts while noting their concerns about several the negative impacts, as summarized below:

The presence of PTNNT had improved their lives due to: o Better infrastructure, including roads and electricity; o Improved irrigation which has increased agricultural yield; o Improved basic human services in education, water and sanitation; o Decrease in malaria due to bed nets provided by PTNNT; and, o A better standard of living due to jobs and increased economic opportunities.

Negative impacts identified included:

o Shifting of values from social solidarity to a more individualistic, materialistic way of life;

o Changes in social patterns, including increase in drug use, crimes, prostitution and Sexually transmitted diseases;

o Lack of equity in education including the disparity in teachers’ salaries in Buin Batu and other schools which PTNNT has built;

o Limited space to move around and access restrictions at Buin Batu; and, o Decreased water quality and a perceived scarcity of water springs.

In several of the cluster meetings, participants identified a “social gap” that was not caused by PTNNT but has created tension in the communities. The Indonesian government relocated people to the three transmigration communities, Ai’ Kangkung, Tatar, and Talonang Baru Village and gave each family farming land, creating a disparity between the transmigrants and indigenous people who have not received land. PTNNT may have compounded the problem by hiring people from outside the local area although most of the employees do not live near the transmigration communities. There are challenges that must be anticipated before the mining closure, such as the people’s capacity in maintaining PTNNT investment and sustainability with limited or no funds. In all four locations, most participants criticized the meeting because, according to them, any meeting related with PTNNT usually did not have any follow up, nor were their aspirations heard. On another note, several of the community representatives were disappointed because, according to them, none of their recommendations on community programs submitted in previous meetings were followed up.

6.0 ANALYSIS OF SOCIAL IMPACT

The focus of this section of the SIA is on assessing impacts that the mining Project has had and will continue to have on the socio-economic environment described in the Baseline section, above. In addition, discussion is offered relative to means the identified impacts can be prevented or limited (where negative) or maximized (where positive). The discussion presented herein is organized as “issues-based” impacts. Specific impacts are discussed in this section; potential strategies to mitigate the identified impacts are discussed in Section 7.0. Identified issues were generated through examination of available documentation and using findings from field work conducted at the Project site, including Focus Groups Discussions with local interest groups and key stakeholders (includes local authorities and relevant organizations). The key issues that emerged through the analysis are the following:

Population and Demographic Shift, Change in Economic Environment,



Natural Resource Management, Adequacy of Social Infrastructure and Services, Vulnerable Groups, Cultural Property, Social Conflict, Changes in Lifestyle and Culture, Gender Equity, and, Closure and Rehabilitation.

Impacts associated with each of these issues, both positive and negative, have been determined for the next three years, reflecting PTNNT’s policy (NEM-SR-S.02) of updating its SIA every five years (2008 to 2013). In addition to being an issue based impact assessment, each issue will be reviewed using the input – process – output – outcome – impact technique. This innovative method was designed to determine the effectiveness of public health programs but will be applied to all issues examined at Batu Hijau, if possible. Specifically the model will be used to better understand how PTNNT is proceeding in achieving the primary goals of the Millennium Development program:

Eradicate extreme poverty and hunger; Achieve universal primary education; Promote gender equality and empower women; Reduce child mortality; Improve maternal health; Combat HIV/AIDS, malaria and other diseases; Ensure environmental sustainability; and, Develop a global partnership for development.

In addition, when appropriate, indicators for monitoring and evaluation purposes are presented in each impact section. Approaches to increase positive impacts and strategies to address any residual negative impacts due to the Project operation and closure are discussed in Section 7.0 – Social Management Plan.

6.1 Population and Demographic Shift

A comparison of available data from the Baseline Technical Report (Dames & Moore 1995), PTNNT 2008 Poverty Mapping data and information provided by participants in community Focus Group Discussion (Appendix C) is presented in Table 6.1. These data indicate that, in 1994, the population of communities within the Project Study Area ranged from 124 to 200 in the community of Maluk (Mantun and Maluk Loka) to 2,546 in Belo. In 2008, the population in each of the 16 communities in the Study Area ranged from 623 in Tatar to 3,000 people in Bukit Damai. From 1994 to 2008, the population in Jereweh Sub-district grew by 6.8 percent and from 2,078 people to approximately 10,000 in the Sekongkang Sub-district. This growth also included direct additions due to the establishment of Buin Batu (3,000 people) and the addition of several transmigration communities to the study area, adding approximately 3,750 people. The population in the Maluk Sub-district grew by the largest number of people, from a range of 124 - 200 in 1994 to approximately 10,000 in 2008 (Figure 8).

Historic Population GrowthPT Newmont Nusa Tenggara


Low Range Population Growth Estimate (1994 and 2008)

High Range Population Growth Estimate (1994 and 2008)

Source: Dames & Moore 1995, PTNNT 2008 Poverty Mapping Data and Appendix C

0

2,000

4,000

6,000

8,000

10,000

12,000

1994 2008



Maluk Sub-district

0

2,000

4,000

6,000

8,000

10,000

12,000

1994 2008



Maluk Sub-district



Table 6.1 - Population Summary of Communities in the Study Area (1994 and 2008) Sub-district/Community

1994 Population

AMDAL

2008 Population

PTNNT

Percent Change

Maluk Sub-district 124 - 200 9,148 - 10,341 4,474 - 8,239.5 Benete (1) 1,556 -- Mantun and Maluk Loka 124 - 200 3,837 - 3,893 1,818.5 - 3,140.8 Mantun -- 1,893 - 2,009 -- Maluk Loka -- 1,828 - 2,000 -- Bukit Damai (1) 1,863 - 3,000 -- Pasir Putih (1) 1,892 -- Sekongkang Sub-district 2,078 9,676 - 10,118 365.6 - 386.9 Sekongkang Atas 1,642 1,799 - 2,373 9.6 - 44.5 Sekongkang Bawah 436 901 - 1,135 160.3 - 106.6 Ai’ Kangkung (2) 912 - 1,014 -- Tongo (1) 1,270 -- Tatar (2) 623 -- Talonang Baru (2) 937 -- Buin Batu -- 3,000 -- Jereweh Sub-district 7,216 7,709 6.8 Goa 2,478 1,389 6.5 Dasan Anyar (3) 1,251 Belo 2,546 2,148 -15.6 Beru 2,192 2,921 33.2 Study Area 9,418 - 9,494 26,533 - 28,168 179.5 - 199.1

Source: (Dames & Moore 1995, PTNNT 2008 Poverty Mapping Data and Appendix C) Notes: (1) - No historical population information available. (2) - Transmigration village in development in 1994 or after 1994 - no historic population data available. (3) - Was included in the population of Goa in 1994. During the 1994-2004 period, the growth rate in the original Jereweh sub-district averaged 13.9 percent per year reflecting the construction and initial startup period of mine development. The population growth rate decreased to 2.7 percent per year between 2004 and 2007. By assuming that there would not have been mine operations in the sub-district of Jereweh and that population would have remained constant as in the period 1980-1990, with a population growth rate of 2.3 percent (Kabupaten Sumbawa Dalam Angka 1994), it is estimated that the population would have reached 12,000 by 2007 and approximately 16,500 by 2022 (PTNNT 2009b). As currently planned, mine closure activities would commence in 2028 and last for five years. As presented in Table 6.1, the population in the original sub-district of Jereweh (or the present sub-districts of Jereweh, Sekongkang and Maluk) in 2008 was estimated to be 28,168 people, almost twice the growth estimate without the influx of residents to the transmigration villages and the mine. Approximately 2,500 new residents were relocated to the area by the Indonesian government, inferring that almost 10,000 people may have moved into the Study Area due to mine development and operation and its spin off business opportunities. During the same time period, the population of the NTB reached 4,076,040 in 2004 and 4,257,306 in 2006. In 2008, the population of the Province had growth to approximately 4,363,756 million (NTB 2009), averaging an annual growth rate of 1.8 percent per year (Kabupaten Sumbawa Dalam Angka 2009). The population of Mataram had a population of around 342,896 in 2005. The 2008 population was estimated to be 362,243 (Kabupaten Sumbawa Dalam Angka 2009), indicating the same average growth rate of 1.8 percent per year experienced by the Province as a whole.



According to the 2009 Mine Closure Plan, the increased population growth rate in the area surrounding the mine tended to be caused by a large in-migration from other areas in the West Sumbawa district and the province of West Nusa Tenggara when the Batu Hijau commenced operations and needed a large workforce which could not be fulfilled by the local workforce from the area surrounding the mine. PTNNT does not anticipate any major changes to its workforce during the next five years. By assuming that the annual growth rate will remain constant at the ‘natural increase rate’ of 1.5 percent per year, it is estimated that the population of the Study Area will reach 30,000 persons by 2015. Natural increase is the number of births minus the number of deaths in each community. Since this growth is estimated to reflect natural increase, no impact on the adequacy of housing or community infrastructure/services is anticipated. It is not possible to use the input – process – output – outcome – impact model for the Population and Demographic Shift issue. It is estimated that the Study Area population will decrease sharply when mine operation ceases. Many families drawn to the area by mining opportunities will return to their place of origin or move to another mine or activity. The Indonesian government may decide to relocate other people to the area but that is beyond the scope of this analysis. PTNNT should monitor population growth during the next five years in order to evaluate this impact and determine whether the Company needs to have some input into the process, particularly with transmigration.

6.2 Change in Economic Environment

Prior to mine construction and operation, the Batu Hijau Study Area was predominantly an agrarian area with about 74 percent of the entire labor force working in agricultural and related activities. The population working in commerce and services formed about 15 percent and 4 percent of the labor force respectively. The main economic activities in the Study Area included farming (crops and animal production), small-scale industrial activities, and commerce.

6.2.1 Employment and Labor

The most immediate benefit associated with the development of the Project was employment creation, both at the national and local level. Jobs were created both directly and indirectly and each salary had a multiplier effect on the individuals, family members and within the broader community. The PTNNT Human Resources Department adopted a local employment policy which aims to give hiring preferences to individuals based on their residential proximity to the Project. Project proximity groupings include:

Local 1 (people from the immediate area), Local-Local 2 (people from the sub-districts of Jereweh, Maluk or Sekongkang), Resident in the NTB Province 3, and Residents of Indonesia.

This hiring process also maintains a preferred hiring target that 60 percent of employees would be residents within NTB Province. This policy appears to have been effective in providing employment to a large number of local and regional residents in the Study Area. In 2008, the Project employed 4,150 people. Of these, 2,652 employees (64 percent) told PTNNT hiring agents they lived within the NTB Province and 1,498 reported they lived outside the Province. Expatriate numbers have reduced as the Project has progressed and Indonesian staff has replaced expatriate supervisors and managers. In 2009, approximately 1.5 percent (64 people) were expatriates. This overall decrease in expatriate presence at the site has created a significant number of high level jobs for Indonesian professionals and has improved the skill base for all of Indonesian mining.



Indonesian law states the minimum age for employment is 15 years of age. PTNNT has adopted a policy that outside employee candidates shall be a minimum of 18 years of age and be no more than 40 years old (for non staff) and 45 years old (for staff). PTNNT has also adopted the policy governing the employment of women which requires certain conditions to be met regarding their employment (Appendix B). PTNNT does not anticipate any significant changes to its workforce and employment would remain relatively stable throughout the duration of its operations. However, in the absence of additional mine expansion, it is anticipated the work force will be reduced at the conclusion of mining in the years approaching 2022 as the Project moves into reclamation and closure. PTNNT has also developed an approach similar to its employment policy for obtaining goods and services from vendors and contractors. The PTNNT Purchasing and Contracts Departments have developed a program called the “Local Business Initiative” which uses a similar contractor categorization based on their proximity to the Project. In addition, the Department, through the LBI program, works with local contractors through training to improve business management and entrepreneurship, guidance on taxes, access to capital, construction and human resource management, and access to a PTNNT-sponsored Business Center facility. In April 2009, PTNNT recorded 258 vendors and suppliers were registered as “Local-Local” (suppliers registered in the sub-districts of Jereweh, Maluk, Sekongkang, Taliwang, Brang Rea, Brang Ene, Seteluk and Tano). Of these, 78 were actively working for PTNNT. Active contractors employed 2,809 unskilled, semi-skilled and skill people in 2005. Of these, 1,873 were from within the NTB Province and 936 were outside the Province. While it is unknown how many new businesses have sprung up on Lombok and other locations in the NTB which are not part of the LBI, it is clear that the increase in air traffic at Mataram’s Selagarang Airport has benefited local communities. In addition, businesses have been established at the ferry depot on the east coast of Lombok and to service the number of employees and their families who live in that area. PTNNT Purchasing and Contracts Departments reported a decline in the need for contracted services beginning in 2002 with the Project moving from the construction phase to operation. The Department also anticipates a decline in business activities would happen in 2010 and 2011 resulting from the delay in the issuance of permits by the government for the Project. It is anticipated that, in the absence of mine future mine expansion, the need for supplied services or vendors to the project will continue to decline in the years approaching the closure and reclamation phases of the Project. The Mine Closure Plan will address the impact of closure on the viability of various mine and mine employee related businesses in both KSB and NTB. Monitoring of employment and labor will continue to use statistics available from the Human Resources, Purchasing and Contracts departments. Periodic evaluation should be conducted to confirm that 60 percent or more of employees and vendors and suppliers are from within the NTB.

6.2.2 Other Economic Opportunities

Indirect economic opportunities have also been created by the Project. Local markets trading in supplies and services have also grown in the Study Area. Based on a survey of 350 households, it was reported that, other than the agricultural sector at 41.1 percent and 6.6 percent relying on fishing, approximately 12.6 percent of the heads of households worked primarily in the service industry, 8.9 percent in trade, 5.7 percent in handicraft, 12.9 percent as private sector workers (including mining), and 12 percent as government employees (PPLH Unram 2006).



PTNNT has developed a plan of community assistance in the form of revolving funds and several skill training schemes implemented by two foundations supported by PTNNT, namely, Yayasan Olat Parigi (YOP) and Yayasan Pembangunan Ekonomi Sumbawa Barat (YPESB). Examples of these programs include:

Tella King Franchise – Based in Mataram, there are now seven Tella King outlets in Study Area communities.

Cultivation of Aloe Vera – Cultivation area based in Sekongkang Bawah, cultivation area is currently 1 ha with production of between 8 – 10 tons per month. Bottling takes placing in Sekongkang Atas with 15,000 bottles per month and employs 12 workers. Program cooperates with Aloe Vera Center Ponianak and US Sarivera in Jakarta.

Fish Nursery Unit – Based in the Hamlet of Sepakat-Tepas, Brang Rea, operation included

pond construction and breeding of “Nila” fish. Produces 10,000 fish hatchlings per month.

Seaweed Cultivation – Based in Jelenga, Kertasari, Tua Naga, the current operation is 12.5 ha with 741 farmers. Includes two seaweed nursery gardens.

BUMDES Development – Village Owned Business in Maluk, Benete, Sekongkang Atlas and

Sekongkang Bawah include drinking water supply and solid waste transportation. Currently provides drinking water to 1,024 households.

Tourism Development – Specifically the development of beaches at Maluk and Benete as

recreational areas. Improvements include restraints, playground, banana boat and fishing boat.

Tourism has been slow to grow on Sumbawa; the PTNNT improvements are viewed locally as recreational improvements for local residents, not tourist attractions. Maluk still lacks lodging facilities that would draw tourists although tourism in Mataram is growing quickly. There are multiple daily flights into Selaparang Airport, including an international flight from Singapore. At the conclusion of mining in 2022 and in the absence of mine expansion, the Study Area communities will likely contract. Remaining economic opportunities will include those that were present before the Project such as collecting and utilizing forest products and marine fishing. In addition, other industries which PTNNT are advancing with communities include higher productivity farming, enhanced business management stills, aquaculture and recreation and tourism. It is hoped by PTNNT assistance with establishing and fostering these activities will enhance livelihoods currently and following the conclusion of the Project. To expedite the development of community-based economy, PPLH Unram (2007) recommended that PTNNT adopt a more comprehensive approach to its Community Development Program from production supervision to marketing of the products. Market access to local products is a strong pull factor that will promote business dynamics and degree of self-reliance of the local entrepreneurs. PTNNT should continue to monitor the viability of these economic opportunities and their impact on livelihood enhancement. PTNNT has gone a long way to achieving the Millennium Development Goal of developing a global partnership for development; additional resources may be needed to continue work on that goal as mining activities decrease.

6.2.3 Family Income

Family income levels before mine operations showed that approximately 83 percent of respondents reported a monthly income below US$22 (approx Rp.200,000) and 44 percent reported less than US$11 (approx Rp.100,000). Since mine operation, the average recorded family income was



approximately US$149 (approx Rp.1,340,000) and in 2005 to 2006 average was US$254 (approx Rp.2,283,000) (Figure 7). Table 6.2 summarizes the monthly household income figures reported in the 2008 Poverty Mapping questionnaire and demonstrates how rapidly family income has grown in10 years and the direction of that growth. Communities adjacent to the mining activities have the highest incomes. Those communities that are still primarily dependent on agriculture have the lowest monthly family incomes. In general terms, improved household income has increased purchasing power and family welfare, functionally eradicating extreme poverty and reducing hunger, both of which are Millennium Development goal. This is reflected, for example, in the consumption and living patterns of the Study Area communities. Much of locals’ expenditures involve home renovation or home building, purchases of household furniture and motorcycles or light vehicles for transportation. In connection to motorcycle ownership, survey data show that 11 percent of respondents owned a motorcycle in 2006 (PPLH Unram 2007). PTNNT should continue to monitor monthly household income in order to ensure that families are maintaining their lifestyles and help employees and local communities prepare financially for the future reduction in mining (and employment) opportunities. Table 6.2 - Monthly Income (2008)

District Community

Percentage of Respondents Earning Less Than

US$55 (Rp.500,000)

Between US$55-167

(Rp.500,000-1,500,000)

Between US$167-389

(Rp.1,500,000-3,500,000)

Greater Than US$389

(Rp.3,500,000) Maluk Sub-district Mantun Maluk Bukit Damai Benete Pasir Putah

12% 18% 5% 2% 17%

29% 40% 50% 36% 35%

22% 22% 38% 35% 25%

30% 26% 7% 27% 22%

Sekongkang Sub-district Sekongkang Bawah Sekongkang Atas Ai’ Kangkung Tongo Tatar Talonang Baru

17% 16% 55% 33% 55% 64%

47% 40% 24% 39% 36% 35%

20% 28% 11% 15% 9% 1%

16% 17% 9% 13% 0% 0%

Jereweh Sub-district Goa Dasan Anyar Belo Beru

42% 34% 39% 32%

26% 38% 36% 38%

17% 17% 19% 14%

15% 11% 13% 9%

Source: PTNNT 2008 Poverty Mapping Data According to the World Bank Group (WBG) study in 2009: “Despite impressive macro-economic growth rates over the past several years, poverty remains high in Indonesia with 36 million people or 16.7 percent below the national poverty line (US$1.55/day) and almost half the population (49 percent) below US$2/day (2007)” (WBG 2009). The poverty lines expressed in US dollars by the WBG roughly equate to the first column of Table 6.2. In 2008 rupiah, US$1.55 to US$2.00 per day would equal approximately Rp.420,000 to Rp.540,000 per month or an average of Rp.480,000 per month.



With the exceptions of Mantun, Bukit Damai and Benete in the Maluk sub-district and Sekongkang Atas in the Sekongkang sub-district, the remaining Study Area communities reported incomes below the national poverty line (listed as monthly incomes Rp.500,000 or less) than in the nation as a whole (16.7 percent). And like general monthly income levels, poverty is more prevalent the further away the community is from the mine. Communities who have families with members working directly or indirectly for the mine have the lowest percentage of families living below the poverty line; communities that rely on agricultural income have the highest percentage of families living below the poverty line. The transmigration communities, Ai’ Kangkung, Tatar, and Talonang Baru have the highest percentages of families living below the poverty line (Figure 9).

6.2.4 Tax and Royalty Generation

The presence of the Project in the Sekongkang sub-district has significantly increased the KSB’s revenue through payment of royalties and taxes. Total tax and non-tax payments to the various entities within the government of Indonesia was over US$468.3 million (approx Rp.4.2 trillion) in 2008 alone. Royalties paid the government in 2008 was almost US$12.7 million (approx Rp.114.3 billion). According to the 2009 Work Plan and Budget (PTNNT 2009f), total tax and non-tax payments made in 2007 were unusually high. Rates presented in the plan for 2009 included US$254.7 million for tax and US$19.0 million for non-tax payments (approx Rp.2.3 trillion and Rp.171.0 billion). Royalty estimates for 2009 were projected to cost US$18.2 million (approx Rp.163.8 billion). The Project has also resulted in a considerable increase in broader economic activities in the Study Area communities, which has also added to the payments of fees and income tax to the government. The Study Area communities rely upon the government of Indonesia to redistribute Project taxes and royalties paid by the Project to government provided infrastructure and services to support the communities and people living in them. In general, members of the communities do not feel government support for infrastructure and services is adequate. In general, the level of mining tax and royalty generation is not commensurate with an increase in local community services. The KSB and Sekongkang sub-district administration have limited financial, human resources and strategic planning capacity. They currently lacks the requisite skills and capacity to manage the many changes that have occurred in the District, and specifically the Study Area. In response, the Company has endeavored to closely collaborate with the District officials and NGOs working in the area, to assist in the capacity building of the district administrative staff to improve service delivery. KSB officials have proposed that PTNNT give them control of the Community Development program and funds in order to allocate resources throughout the area, but PTNNT has resisted that request in order to be able to respond to specific community requests in a timely fashion. In the absence of Project expansion, tax and non-tax revenues paid by the Project to the government of Indonesia will cease at the conclusion of mining in 2022. It is possible that government funding levels to the District, sub-districts and Study Area communities will also decrease. It is not clear how much funding is provided to Study Area communities as a result of PTNNT tax and royalty payment to the Government. PTNNT should monitor local tax and royalty distribution amounts and capacity building efforts in order to establish current funding amounts and potential decrease impact resulting from mine closure. Newmont is a member of Extractive Industries Transparency initiative (EITI), which is organized to increase transparency over revenues in the extractive sector in countries that are heavily dependent on these resources.

Sekongkang Bawah

Maluk Loka

Beru

JerewehSub-District


MalukSub-District

(64%)

(55%)

(33%)

(55%)

(17%)

(16%)

(18%)

(2%)

(17%)

(5%)

(39%)

(32%)

(42%)

(34%)

Goa

Belo

Bukit DamaiPasir

Dasan

Tongo

Benete

Tatar / SP-2

Talonang / SP-3

Sekongkang Atas

Aik Kangkung / SP-1

(35%)

H:\N

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NT

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Ma

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0 6KilometersStudy Area Communities

Percent Below Poverty Level (2008)PT Newmont Nusa Tenggara



B A L I S E A


CommunitiesAdministrative Sub-DistrictsPercentage of 2008 RespondentsWith Monthly Income Less ThanUS$55 (Rp.500,000)

Batu Hijau Project




6.3 Natural Resource Management

A majority of the Batu Hijau Project is located within the boundary of a government-production forest that had been degraded to a greater or lesser degree by logging and encroachment of agriculture. Current mine planning includes expansion plans for waste rock placement, water diversion systems and other development plans will include areas of protected forest as designated in the recently approved forest barrow and use permit (called pinjam pakai). In addition to the deposit at Batu Hijau, PTNNT also holds rights to Elang, a highly prospective porphyry copper and gold deposit located 60 kilometers east of Batu Hijau, Rinti, and Teluk Panas, an area with significant exploration potential which is located another 20 kilometers east of Elang. According to PTNNT, following the commencement of operations, the Government of Indonesia purported to designate the land adjacent to proposed expansion areas of the Batu Hijau Project as a protection forest. PTNNT was in discussions to renew its forest barrow and use permit to access these areas for over 2½ years (AMEC 2008). This permit, a key requirement to continue to efficiently operate the Batu Hijau mine, was issued on 1 September 2009, valid retroactively from 2005. The permit ensures that PTNNT will continue to mine until 2022. Use of natural resources from the forest contributes slightly to household food security throughout the Study Area. The University of Mataram audit suggested that since 2006 there was little use of forest products (PPLH Unram 2007). Inhabitants use the forest reserves to cut wood, and to pick fruit, mushrooms and medicinal plants. Currently there are vehicle access restrictions to forested areas above the Project to limit the possibility of illegal timber harvesting. No impacts to natural resource management or access to forest land impacts have been experienced or are expected due the Batu Hijau Project. There is sufficient farm land off the mountain, and PTNNT has developed irrigation systems and educational programs to enhance yield. Some residents have complained that access to the mine and to Buin Batu is controlled but that is an unavoidable safety precaution (Appendix C). Several environmental concerns have the potential to affect the people living in the Study Area. The first is the long-term impact of the submarine tailings disposal on the marine fishery and the long-term impact of mining on the quality and quantity of groundwater and river water that may be used by residents of communities in the Study Area for bathing, washing, and drinking. While at present marine fishing is a small industry on Sumbawa, the Government of Indonesia hopes to someday develop fishing as a major industry throughout the islands that make up the country. PTNNT will continue to monitor and assess the tailings discharge, the amount of metal accumulation in fish muscle tissue and shellfish under the terms of the RPL PTNNT permit. PPLH Unram 2007 recommended that PTNNT conduct a study on sea fish resources management or establish robust communication, socialization and information dissemination of related issues to community. The University auditors believe that the study should emphasize institutional strengthening and management of coastal community (community-based regulation or awig-awig), compliance to marine protected area and coastal community business management system. Although there has been public discussion and controversy about the Project’s impact on the water resources, PTNNT regularly monitors surface and subsurface water quality. All waters currently meet monitoring parameters for health and safety of adjacent users. In addition, the community development investments in water and sanitation facilities have reduced the use of river water for bathing, washing, and drinking significantly. Currently private citizens in the Study Area with houses and land have little documentation or evidence of legal ownership rights to these assets. PTNNT is monitoring the government sector as it works to improve land ownership and property ownership documentation issues. Once the



system in improved, it may result in the improved the ability of residents to access credit or borrow against these assets and utilize their wealth fully. For example, access to credit secured by these assets may be utilized to improve agricultural techniques by purchasing equipment or better seeds. PTNNT is meeting the Millennium Development Goal to ensure environmental sustainability.

6.4 Adequacy of Social Infrastructure and Services

Before the Batu Hijau Project was undertaken, the Study Area had relatively low levels of social infrastructure and facilities. The ComDev community investment program has made great strides at improving infrastructure and facilities throughout the Study Area both in terms of direct inputs such as new facilities and processes, such as training. The outcome has been increased physical infrastructure and services leading to improved health and emotional satisfaction.

6.4.1 Education

PTNNT has increased the number of schools in the Jereweh, Sekongkang and Maluk sub-districts. In 2007, there were 2,987 student in primary school; 834 students in junior high; and 339 students in senior high in the Study Area. These figures do not include the number of students in the Madrasah Ibtidaiyah, Tsanawiyah, and Aliyah Islamic schools. The rapid development of educational facilities in the past 10 years has provided considerable opportunities for the people around the mine to achieve education and continue on to higher education close to their own homes.

Table 6.3 - Comparison of Public Education Facilities (1995 and 2007)

Education facility Number of facilities

1995 2007 Percent Change

Primary school 13 17 30.8

Junior high school 1 6 500.0

Senior high school -- 2 200.0

Source: Education, Youth and Sport Regional office West Sumbawa district

While PTNNT has constructed and equipped the schools, the government of Indonesia supplies the teachers. There have been some complaints in the communities in the Study Area that the teachers lack experience and that the schools in Buin Batu (where PTNNT does supply the teachers) is far superior to the schools in the other communities. PTNNT should continue its dialogue with local residents concerning the adequacy of teachers.

PTNNT also provides educational supports to that provided by the government, including scholarships for high-performing students and educational assistance for economically-challenged students. The supports are intended to enable students from the local population to pursue higher education either in the district of West Sumbawa, the NTB province or even outside of the provincial boundaries to tertiary education institutions (Figure 10). From 1998 to 2009, some 6,355 students (tertiary 34.7 percent; Senior High/MA 31.6 percent and Junior High/MTs 33.7 percent) have received scholarships from PTNNT to a total assistance value of US$731,278 (approximately Rp.6.58 billion). Of the total scholarship recipients, 47 percent originate from areas surrounding the mine (sub-districts of Jereweh, Sekongkang and Maluk). Other assistance has been provided by PTNNT in the form of school library and journal development in 24 schools. Two mobile libraries were also created with more than 3,000 books and 6,000 members in 2009. This is up significantly from 2003, 1,673 people registered as library members, comprising 1,280 students and 393 other community members. In 2005, the total increased to 4,411 over 5 sub-districts: Jereweh, Sekongkang, Taliwang, Brang Rea, and Seteluk; 2,728 of them being from Jereweh and Sekongkang.

Historic Number of Scholarship RecipiantsPT Newmont Nusa Tenggara


184 184

436485 507

625

718 741

852941

846

0

100

200

300

400

500

600

700

800

900

1000



It is clear that the Millennium Development Goal of achieving universal primary education has been strengthened because of the inputs and processes provided by PTNNT; work remains for the Indonesian government to improve the quality of teaching to meet expectations of local residents.

6.4.1 Health and Medical Facilities

Prior to 1997, NTB Province was widely recognized as having some of the most unsatisfactory public and environmental health and social indicators of the Indonesian provinces (GOI-UNICEP 2000). A baseline study conducted in 1996 for Jereweh sub-district indicated health circumstances similar to the NTB Province including respiratory tract infections and communicable diseases, particularly malaria being major contributors to both infant and adult morbidity. There were also high case load for fungal and allergic skin diseases, ulcers and ear and eye infections (Hilderbrand 1996, Robinson 1998), (University of Indonesia Collaboration 2009). Access to quality health care has been enhanced by the Project by providing new facilities, new and newly trained medical professionals, and programs designed to address specific diseases and ailments. PTNNT has built or renovated health care facilities (puskesmas) in each of the Study Area sub-districts of Jereweh, Maluk and Sekongkang. In 2006, these hospitals combined treated 8,458 patients in the Study Area. A comparison of available data from 2004 and 2006 indicates (in general) the prevalence of the ten most common diseases have gone down on a point-to-point basis in the sub-districts of Jereweh and Maluk (Table 6.4). Exceptions to this trend include rates of skin infections, arthritis and allergies in Jereweh. Table 6.4 - Ten Most Common Diseases Suffered by the Population (2004-2006)

Puskesmas Jereweh Puskesmas Maluk Puskesmas Sekongkang

Type of Disease Patients

Type of Disease Patient

Type of Disease Patient

2004 2006 2004 2006 2006*

1. Other Diseases 1,494 1,234 1. ISPA 1,037 822 1. ISPA 561

2. Upper Tract

Respiratory

Infection (ISPA)

1,239 1,121 2. Diarrhea 915 293 2. Clinical malaria 488

3. Skin Infection 303 332 3. Skin Infection 689 158 3. Rheumatism 233

4. Rheumatoid

Arthritis

281 293 4. Skin Allergy 638 121 4. Skin infection 213

5. Diarrhea 234 238 5. Muscle Pain 630 63 5. Diarrhea 199

6. Allergy 203 221 6. Clinical Malaria 623 129 6. Skin allergy 143

7. Hypertension 197 197 7. Other Diseases 368 304 7. Accident 146

8. Asthma 195 185 8. Bronchitis 178 69 8. Conjunctivitis 40

9. Laryngitis 173 153 9. Accidents 95 79 9. Fungal infection 9

10. Malaria 159 129 10. Gingivitis /

Periodontal

82 41 10. Others 243

Total 4,478 4,103 Total 5,273 2,079 Total 2,275

Source: Jereweh and Maluk Puskesmas Activity Reports, 2004, 2007 - * = Started operation in 2006.

In 2007, there were 8 general practitioners, one dentist and 27 midwives in addition to other health professionals in the Study Area. In addition, paramedics are also now available to communities. Funding sources for these facilities include the District Health Office Kabupaten. PTNNT has



completed many renovations and upgrades to these medical and health facilities. Presumably, this assistance has allowed more government funding to be applied to health services rather than building improvements and furnishings. PTNNT has also made donations of medical equipment and provided for the training of 169 community health monitoring agents and 197 community health personnel.

6.4.2 Community Health Programs

The following sections present information on how the programs and facilities introduced by PTNNT have helped to achieve the following Millennium Development Goals:

Reduce child mortality; Improve maternal health; Combat HIV/AIDS, malaria and other diseases;

Well Baby Program PTNNT, though its Community Health Program, supports posyandus (integrated health services stations) programs for under performing five year old children (UFY) experiencing undernourishment and to monitor recipient families as well as child health statistics to monitor the child’s progress. This program has increased from 15 posyandu units in 1998 to 43 posyandu units in 2008. UFY attendance rates increased from 35 percent in 1998 to 63.84 percent in 2008 representing 2,636 children. The number of malnourished children in the Project area has decreased from 143 children in 2004 to 38 in 2007. Malaria / TB / HIV / AIDS / STDs PTNNT is partnered with International SOS (ISOS) and together they have contributed to the Public Health and Malaria Control Program. The program covers 27,604 inhabitants within an area of approximately 880 square kilometers. The purpose of this program is to promote awareness, monitor and analyze public health conditions, particularly Malaria, TB and HIV/STIs in the Project area (ISOS 2008). Specifically the goals of the program include:

Prevent epidemics and spread of disease, Enhance disease knowledge and behavior, Respond to public health crisis and assist in recovery, Conduct health surveillance and diagnosis, Diagnose and investigate health problems and conduct health risk assessments, Provide information, education and awareness of health issues, Create policies and plans as needed to support public health, Enforce laws and regulations the protect public health and safety, Link those who need health care with heath care service, Ensure heath care workers are available to employees, and, Evaluate the effectiveness, accessibility and quality of staff and community based health

centers.

According to PTNNT Community Health Program statistics, cases of malaria in the Study Area have dropped significantly from 47 percent of the population contracting the condition in 1999 to 0.62 percent in 2008 (PTNNT 2009g). Prostitution has become more common in the Maluk area primarily because of the number of single men who work at the mine in the area. While prostitution is noted by local residents, no particular problems have arisen, save the public image of sex workers, the sex trade and the Islamic prohibitions to the practice. Internationally, mine areas are often a catalyst for increased



prostitution activity. According to Maluk Sector Police records, in 2008 there three instances of adultery or prostitution and four instances in (2009 Maluk Sector Police 2009). Nusa Tenggara Barat Dalam Angka 2009 reports that of the 220 HIV/AIDS cases reported in the province in 2008, half of them were in Kota Mataram and another 10 percent were in Sumbawa Barat. Health risks related to HIV/AIDS and other sexually transmitted diseases (STDs) are communicated to mine employees and people living in the surrounding communities through a process of education, case detection and treatment strategies. ISOS has a specific monitoring and evaluation program and reports its findings to PTNNT, the district and provincial governments regularly.

6.4.3 Water and Sanitation

PTNNT has developed and made available water and sanitation services in ten Study Area communities serving more than 10,000 people (PTNNT 2009g). In 2005, 64.8 percent of (PPLH Unram 2007) respondents reported using water wells to obtain water and only 17 percent used piped water. In 2006 this percentage increased to 28 percent. Also, the use of river water decreased from 1.4 percent of respondents to 0.2 percent in 2006. PTNNT monitors water quality for both well and borehole water. All of these developments potentially contributed to the general improvement to health of the people living in the area.

6.4.4 Electricity and Energy

In 1994, a power station was built in Sekongkang Atas to provide electricity for that area. Until the end of 1995, areas such as Tongo, Maluk, Tatar, and the transmigration settlements had no electricity. In 2006, almost all villages surrounding the mine had a domestic light source with the exception of Ai’ Kangkung and Tatar villages. In these two villages, some of the inhabitants use generators. In some villages, electrical generator operation has been supported by PTNNT. For example, in Tongo, support has taken the form of subsidizing monthly operational costs. Every month, PTNNT provides free fuel (200 liter per month) for the electric generator in that village (PTNNT 2009). This represents a current monthly subsidy of over US$4,000 (approximately Rp.38,400,000) per month in 2010.

6.4.5 Transport and Communications

Prior to mine development and operation, roads in the Study Area were quite primitive. Some farming produce was transported by horse and cart. Roads in around the Project have improved significantly and PTNNT continues to coordinate with local governments to maintain existing roads and construct new roads. By 2008, PTNNT had facilitated the development and improvement of up to 400 km of roads in the study area (PTNNT 2009 and 2009b) via ComDel projects. In addition to improved road connections between the communities in the Study Area, the Batu Hijau mine has dramatically improved transportation to Sumbawa via the Travira Air sea plane service between Denpasar and Mataram to Benete and the ferry service from Benete to Lombok

6.4.6 Safety and Security

Study Area communities within the Maluk Police Sector rely upon the Police headquarters in Maluk for security services. In 2008, there were 89 cases reported; 63 cases had been reported for 2009 through August of that year. In general, the types of crimes reported are minor petty theft and verbal assaults. At the conclusion of mining in 2022, it is anticipated that the number of people living in the Study Area will decline. However, those that remain may elect to maintain or improve existing infrastructure and or services. In the absence of PTNNT involvement on-going Company-sponsored support for these systems and services, alternative sources of funding will need to be identified.



6.5 Vulnerable Groups

The International Finance Corporation’s Performance Standard 1 defines vulnerable groups as those who may be affected disproportionately by a project by virtue of their gender, ethnicity, religion, culture, dependence on a unique natural resource for their livelihoods, or other characteristics. The standard also requires that vulnerable groups be identified in the Social and Environmental Assessment of a project, that mitigation measures be adopted to ensure that adverse impacts do not fall disproportionately on these groups, and that they share in project benefits like other groups. Indonesia does not have its own formal definition of Vulnerable Groups. In 2008, PTNNT prepared a Poverty Mapping Questionnaire to identify the number and location of poor people within the Study Area in order to develop mitigation measures. In general, the transmigration communities of Ai’ Kangkung, Tatar, and Talonang Baru Village are considered to be the most likely places to see financially vulnerable residents because:

These residents were relocated by the Indonesian government and may not have strong local family or religious ties to others in the Study Area;

Community members at these locations are more physically isolated that other residents

(especially residents of Talonang Baru Village); and, These residents are the least likely to be employed by PTNNT or one of its contractors.

Residents of these three communities have incomes which are primarily from agriculture and therefore lower than residents of other communities. The following descriptions were derived from the 2008 PTNNT Poverty Mapping Survey.

Livelihoods in the Ai’ Kangkung community (SP-1) vary from agriculture to collecting forest products to being employed by a mine company. Approximately 12 residents work for PT NNT. The majority of the households (79 percent) have incomes of less than 1,500,000 rupiah per month. Less than 10 percent of the households have incomes of over 3,500,000 rupiah per month.

Livelihoods in the Tatar community (SP-2) vary from agriculture to collecting forest products to being employees of a mining company. Approximately 8 residents work for PTNNT. The majority of the households (91 percent) have incomes of less than 1,500,000 rupiah per month per capita. Approximately 55 percent earn less than 500,000 rupiah per capita per month. No respondent earns more than 3,500,000 rupiah per month.

Livelihoods in the Talonang Baru Village (SP-3) include agriculture and collecting forest

products. It is uncertain if any residents work for PTNNT. The majority of the households (99 percent) have incomes of less than 1,500,000 rupiah per month per capita with 64 percent of those having per month per capita incomes of under 500,000 rupiah. Only one household in Talonang Baru Village earns more than 1,500,000 rupiah per month.

International experience is that the dominant risks of involuntary resettlement (such as that seen in the transmigration communities) are landlessness, joblessness, homelessness, economic setback, increased morbidity and mortality, food insecurity/malnutrition, social disorganization, and loss of common property. Several risks are often realized simultaneously - for example, loss of land, employment, home, in a deteriorating social structure. Fortunately, this has not been the case with the communities in the Study Area. Most transmigration families received up to two hectares of land as a condition of their relocation and while their homes are not classified as being of permanent construction, they appear to be adequate. Most residents also enjoy family/community support, and non-Muslims appear to be well-integrated into the communities.



PTNNT has made several investments in the transmigration communities of Ai’ Kangkung and Tatar. Ai’ Betak contains a windmill and an irrigation office. The community has a clinic provided by PT NNT and there is also a well baby clinic in Senetuk. According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Ai’ Kangkung from 1998 to 2009 by PTNNT included:

Drainage investments: o SP-1 Irrigation (Channel), Phase II - Completed December 2003 o SP-1 Irrigation Channel , Phase 2 - Completed September 2005

Other community development investments and projects:

o SLTP SP-1 Rehab. Existing Building (Classroom) - Completed November 2004 o Labuhan Posyandu Senutuk - Completed July 2005 o Posyandu Ai’ Kangkung , SP1, Tongo - Completed August 2005 o Pustu Renovation - Completed March 2005 o Pos P3A - Completed August 2005

According to PTNNT records (PTNNT 2009b and 2009d), investments in and near the community of Tatar from 1998 to 2009 by PTNNT included:

Road investments: o T. Site Intersection - Road maintenance, mayor repair / priority road - Completed

September 2003 o Tongo-SP2 Road Maintenance - Completed October 2004

Drainage investments:

o Rump Pump Study, SP2 - Completed August 2005 o SP-2 Irrigation Construction - Completed December 2002

Other ComDev investments and projects:

o Primary School Rehabilitation SP I & SP2 - Completed December 2002 o Total Rehab School SD 03 Tongo Phase II - Completed September 2005 o Pos P3A, Tatar - Completed August 2005

PTNNT has not yet made any capital investments in Talonang Baru Village. There do not appear to be other vulnerable groups residing in the Study Area. While it is estimated that 99 percent of the population in the Study Area is Muslim, the Ai’ Kangkung community contains a small group of Hindus, originally from Bali, who were relocated during the transmigration exercise. There is no evidence of any social issues with this group living in the dominant Muslim culture. There are no significant issues with older residents or ethnic differences between residents. Issues concerning gender are discussed further in Section 6.9 - Gender Equity.

6.6 Cultural Property

In many developing countries, sacred sites and cemeteries are important in terms of their linkage with the authority of the ancestors, which contributes to the ideology of affected households and communities. This is not the case in Indonesia as 99 percent of the residents of the Study Area are Muslim and do not hold these beliefs about heritage resources.

6.7 Social Conflict

Social systems and structures have evolved in the Study Area over generations and have weathered several influxes of new residents. These systems are not static and have been able to respond



dynamically to the changing social environment. The importance of identifying these changes is not to try to prevent them or actively preserve and restore the pre-project status quo but rather to understand where project-related changes have and may continue to impact on the social environment. The Social Conflict issue is not amenable to using the input – process – output – outcome – impact methodology. The influx of new residents as result of the Project has had both positive and negative impacts. On the negative side, the Project increased pressure on existing social infrastructure such as available accommodations, educational and health facilities, and water and sanitation facilities. An additional negative impact has been an increase is social vices such as crime, prostitution, drugs and violence. Criminal activities and prostitution is recognized as an unavoidable consequence of mining, which, aside from the health implications, tends to create conflict between spouses, sometimes with breakdowns in marriage and disruption of families and children. Representatives of the Focus Group Discussion noted that people seem to be shifting their values from social solidarity to a more individualistic, materialistic way of life (Appendix C). On the positive side, a population influx has brought some diversity to the Study Area and facilitated an expanded world-view that local people, most of whom rarely travel, would otherwise not access. PPLH Unram 2006 noted that local residents were apparently adopting many of the newcomers’ behaviours, especially relating to increased productivity. Other Impacts identified include increased conflict within and between households and communities, often expressed as jealousy about the increased financial situation of PTNNT and PTNNT contractor employees. PTNNT is aware of the jealousy issue and has implemented a program which assists 75 non-employee families in each community to rehabilitate and update their housing. To date, 75 houses have been completed in Tongo. There has also been some conflict between locals and ‘outsiders’ from other parts of the country and between local and expatriates. The employment of ‘outsiders’ initially caused conflict with local residents because many local residents believed that jobs should have been awarded to them. This issue was emphasized during the scoping study, as well as during the 2009 Focus Group Discussions. PTNNT adopted a local employment policy which aims to give hiring preferences to individuals based on their residential proximity to the Project. To prevent any conflict and misunderstanding, the Company has embarked on a sensitization process to educate the communities about its job requirements and defray their thoughts from unrealistic negative impacts. In addition, the relocation of migrants from other parts of Indonesia to the transmigration communities of Ai’ Kangkung, Tatar, and Talonang Baru Village has had an impact on the social environment. Over 10 percent of the Study Area population (all in Sekongkang Sub-district) resides in these communities, which has produced social impacts on adjacent communities and on the Batu Hijau Project itself. Very few of these in-migrants have the skills required to work at the mine but have very clear social and physical needs and desires. The expatriates and non-local Indonesian employees were sensitized to the local social and cultural practices and norms in order to adapt to the local society. All expatriate staff is expected to behave in a manner that is appropriate to the local community. Men employed by the Company are seen as attractive and desirable potential husbands who will bring stability to the family and community – whether they are insiders or outsiders marrying into local communities. Already salaried men are seen to be building more stable housing structures through which they demonstrate permanence in their attitude to being part of the community. The same social conflict issues are apparent on Lombok where many of the Batu Hijau workers live with their families when they are not working. Batu Hijau miners work a 4-day shift and live at company housing during their tour if they do not live in the Study Area communities. They then return to their homes on Lombok when they are not working. Shift work can be disruptive to family



life and lead to stress. Nusa Tenggara Barat Dalam Angka 2009 reports on the number of victims of violence which are handled by social services (domestic violence) rather than the police. Of the total 13,370 cases handled in the province in 2008, 145 of them were from Sumbawa Barat; only 6 (4 percent) of those cases involved violence against women. There were 357 cases reported in Kota Mataram, of which 137 (38 percent) involved females. For the entire island of Lombok (Lombok Barat, Lombok Tengah, and Lombok Timus) there were 3,897 cases reports of which 3,389 (87 percent) involved females. There are no statistics about how many of these cases involved PTNNT employees, but the difference in domestic violence complaints from Sumbawa Barat where employees live at home and Lombok where employees live at home only part time may demonstrate how the stress of living away from the family affects family dynamics. During the focus group discussions, several residents indicated dissatisfaction with how ComRel deals with local concerns and/or implements local ideas. It is understood that, open and ongoing communication between PTNNT and community representatives can foster an awareness of changes, conflict, reasonable expectations. At the same time, developing long-term planning synergies between the Company and the Sub-district officials are also vital.

6.8 Changes in Lifestyle and Culture

The lifestyles of the residents of the Study Area have changed dramatically since the construction and operation of the mine. The area has changed from an agrarian (traditional) lifestyle to one based on industry and cash money. PPLH Unram 2007 reports that residents have become more open and cosmopolitan in their lifestyle, expressed by a more varied diet and a change in their spending priorities. Consumer spending has shifted from being primarily related to housing, food, and clothing to education and investment. Accumulation of prestigious goods such as motor bikes has increased and people are investing in their children’s future through education and starting businesses. PPLH Unram 2006 notes that local residents continue to practice traditional ceremonies and rituals such as marriage ceremonies and rites of passage although they may now have a more modern implementation. PTNNT has respected the predominantly Muslim culture of the Study Area. In addition to its modified work practices, described below, the Company has constructed mosques and madrasahas as part of its community development investments. All Company/community interactions are organized to respect Muslim holidays and cultural expectations. PTNNT restructures its work assignments to accommodate Ramadan during which Muslims take no food or water from sunup to sundown. Output is reduced and workers have special safety discussions during this time. PTNNT reports that approximately 90 percent of their workforce is Muslim; between 10-20 percent are devout. PTNNT provides a mosque in Buin Batu and small rooms in most work facilities for prayer, including at the mine. Workers are allowed time for prayer twice a day (between 15-30 minutes each) and on Fridays they receive an additional hour at noon after which most devout Muslims leave for the weekend. In addition, no pork or pork product has been served in any PTNNT facility since 2001/2002 (private living quarters excepted). According to Halal dietary guidelines, Muslims do not eat reptiles, amphibians, turtles, or eagles. Alcohol is available at the club and the commissary: no alcohol is available at the employee cooperative food store. The University audit (PPLH Unram 2007) indicated that there had been an increase in criminal actions beginning in 2006, including fighting, abuses, theft, and threats. The apparent causes of this increase was thought to be caused by newcomers who can’t find jobs and by an increase in bars and related facilities in Sekongkang Bawah and Maluk. Nusa Tenggara Barat Dalam Angka 2009 reports on the number of victims of violence which are handled by social services rather than the police. Of the total of 13,370 cases handled in the province in 2008, 145 of them were from Sumbawa Barat;



only 6 of those cases involved violence against women. There were 357 cases reported in Kota Mataram, of which 137 involved females.

6.9 Gender Equity

Gender issues are traditionally examined in social impact assessments to ensure that women, who are often more economically vulnerable than men, are not ignored in assessing both the impacts of developments and the plans to implement programs as part of PTNNT’s broader social responsibility. In fact, promoting gender equality and empowering women is a Millennium Development Goal. Existing gender roles, strengths and vulnerabilities identified during the SEIA highlight the following issues or practices: Household roles and responsibilities in the Study Area conform to traditional Muslim ones

where women are responsible for domestic and child-rearing tasks and undertake most food preparation in the home.

Men are involved in clearing of new fields and most agricultural pursuits, although both women

and children may help with the planting and harvesting. Men are the primary wage earners while women may be sellers of market produce.

Employment is split by occupation along gender lines with men being miners, carpenters, masons, etc. and women practicing as nurses and teachers.

Most leadership roles are held by men. Community meetings are dominated by men. Family violence against women is uncommon in the Study Area (according to health

practitioners, social service agencies and local police officers). PTNNT has not discriminated in its hiring practices based on gender, and job opportunities provided by the Company have been equally available to both male and female applicants, provided they are suitably qualified. Residents recognize that most mine-related jobs have gone to men. Women are employed in certain jobs in accordance with Indonesian law and common practice, which restrict the ability of many women to work at night. Most women employees work in the administrative and support fields where they can work during the day light hours. To date, there has been little to no community dissatisfaction with this arrangement as it conforms to existing community standards; no additional impacts are expected to 2015.

6.10 Closure and Reclamation

The Company uses an approach which considers both the imperatives of the mining company and Indonesia’s national government. Reclamation work is on-going and the mine is expected to transition into full closure activities in 2028 (18 years from now) and that therefore it is both desirable and possible that land and other resources will be rehabilitated and repatriated in conjunction with mine closure and decommissioning. This issue area is not suitable for impact assessment using the input – process – output – outcome – impact methodology. Post-mining land use and settlement is a critical issue that requires long term planning. Examples around the world suggest that many communities are worse off after mine closure, primarily because development programs end after mine closure; social infrastructure sometimes deteriorates and opportunities for health and education are often reduced. Poverty levels generally increase in a



post-mining environment because the levels of service delivery collapse as the revenue and other forms of support from the mine cease. All mining of Batu Hijau pit ore will be completed by 2022 and processing of ore from the stockpile shall continue until 2027. Production scheduling and tonnage mined is based on the mining plan drawn at the end of 2008. Mine closure is scheduled to commence in 2028 and last for five years. PTNNT developed a Mine Closure Plan (PTNNT 2009) that addresses the short-, medium- and the long-term development needs in the area. The general intention of the PTNNT mine closure plan is as follows: Fulfill or exceed Indonesian legal requirements and stipulations in terms of environmental

management, agreements determined together with partners and financing institutions and responsible standards of environmental management determined by Newmont Mining Corporation.

Include environmental considerations at all stages of planning, developing, operating and

closure of all structures. Determine and apply programs directed towards significant risk management, including all

matters related to tailing placement and mine water management. Regarding its social responsibility, PTNNT has indicated in its Mine Closure Plan that it will: Communicate openly with government, non-government organizations (NGOs), community,

employees and all other related stakeholders and provide them with up-to-date and factual information on the Batu Hijau operation.

Cooperate in partnership with the community, NGOs and the government to ensure that all

programs are undertaken by applying best practices and are aligned to programs of sustainable development.

Ensure that sustainable programs are based on the four pillars of sustainable development,

namely: health, education, community welfare and suitable infrastructure. The Mine Closure Plan indicates that, upon completion of mining and processing activities, the main infrastructure and equipment will be dismantled and removed from the mine for sale, reuse or to be scrapped. Article 22 of the Contract of Work (CoW) states that at the end of operations, the government has first option to purchase the area, as prime user of the entire PTNNT facilities and assets in the CoW area. However, should the government decide not to use the property, PTNNT shall have 12 months to sell, remove or dismantle the property. All property not dismantled or discarded shall become the property of the government without any compensation to PTNNT. Article 22 also states that PTNNT property which is used for public benefit, such as roads, schools, hospitals and all related equipment shall become government property without any compensation to PTNNT. As part of the mine closure, PTNNT is assuming that all infrastructure and equipment on site will be dismantled in order to stabilize the land and conduct reclamation activities on area disturbed by mining, consistent with future land utilization. Buildings and office facilities, mess hall, and accommodation and recreation facilities in Batu Hijau Township will be retained for use by the local community. Before that, discussions will take place with government institutions and stakeholders to identify which buildings should be demolished or be left standing for community use.



The Mine Closure Plan identifies potential impacts that will likely occur following completion of mining activities, including cessation of employment between PTNNT and its employees. This situation, in turn, could cause widespread reduced economic activities and reduced community income. According to the Mine Closure Plan, PTNNT will begin shrinking its workforce starting in 2014. By 2022, when mine activities cease and transition to the processing of stockpiles ore until 2022, it is estimated that approximately 25 percent of current PTNNT employees will continue working when the mine begins to shut down operations. The number of workers will continue to be reduced towards final closure of the mine. Reduced mining activities will also impact PTNNT contractors, which in turn will result in a reduction in PTNNT contractors’ workforce. At that stage, it is difficult to estimate the extent the decrease in PTNNT contractor workers will take; however, in general terms, a smaller number of employees required can be anticipated. Public concern has also been raised about the possibility that illegal mining may occur after mine closure if people believe that a quantity of valuable mineral deposits might be found in closed waste dumps or tailings. This potential environmental issue will be examined in future updates of the Mine Closure Plan. Additionally, mine closure can also potentially end several community development programs. PTNNT is developing an approach to prepare for communities to become economically independent and not rely on assistance from the Company. An essential element of the mitigation strategy is a philosophy to ensure that at mine closure the local institutions can effectively manage the social infrastructure using a partnership approach between the Project, government and other relevant stakeholders to ensure long-term and sustainable management.

7.0 SOCIAL MANAGEMENT PLAN

This section presents the primary components of the Social Action Plan for the Batu Hijau Project and is intended to describe actions that will be taken to mitigate social impacts identified in Section 5 - Context and Baseline Information and Section 6 - Analysis of Social Impact) along with a discussion of the basis for the proposed mitigations. The majority of the actions/programs described herein were introduced previously in Section 6. The social teams’ assessment of impacts and development of mitigation recommendations were based on the following principles:

People-centered: Development interventions should focus on people and what they consider to be important. Work on social mitigation should focus on both the people within the industry and those directly and indirectly affected by its activities;

Holistic: As people engage in diverse livelihood strategies, the business should understand

this diversity and aim to impact different spheres of people’s lives – not just that related to the core function of the company;

Strengths-based: Interventions should build on what people have and the activities they

are currently engaged in. Similarly, business should build on a number of existing social investment initiatives;

Partnerships: Interventions should help build partnerships between and among stakeholders (government, civil society, society, NGOs, donors and the private sector). In this situation, the business should play more of a facilitator and animator role than that of a service provider;



Micro-macro linkages: Interventions should ensure that there is synergy between the situation (including projects) on the ground and policies and programs of the business, government and other stakeholders at all levels;

Sustainability: Issues of economic, environmental, institutional and social sustainability

need to be considered and the necessary trade-offs considered; Dynamic and flexible: As the environment within which people live (especially the poor)

is constantly changing, it is important that interventions by business make allowance for this. This also indicates the need of business to move to becoming more dynamic and flexible learning organizations.

In addition to the foregoing principles, the team established mitigation and social responsibility, investment, and sustainable development objectives for the Social Management Plan. PTNNT has completed several actions that address these objectives. The objectives and examples of actions are summarized below:

Mitigation Objective: Actions required to address an effect caused directly or indirectly by the Project by either minimizing the harmful aspects of an impact or maximizing the benefits of an effect.

Examples of Mitigatory Actions – The busing program which allows people to get to work; the Batu Buin townsite which provides housing and municipal type services to mine workers and their families; the housing allowance which allows people to live off site and contribute to their home communities; and medical services which are provided to employees.

Social Responsibility / Investment / Sustainable Development Objective: Actions which enhance the communities and people in the Project’s area of influence without being required or which do not directly mitigate a Project impact.

Examples of Social Responsibility / Investment / Sustainable Development Actions – Rehabilitating houses of non-employees in order to reduce the conflict between employees and non-employees; building schools in order to increase the opportunity for education; building irrigation systems and providing demonstration farms to increase rice and other agricultural yield; providing medical services to communities regardless of whether residents are employees or not.

By applying these principles of mitigation and social responsibility, investment, and sustainable development objectives, actions which will serve to mitigate identified issues were developed. In developing the mitigation impacts, AMEC Geomatrix completed their own evaluation (as described in Sections 5 and 6 of this document) and reviewed two PTNNT- developed documents to ensure the mitigation goals and actions previously established by the Company were integrated into the overall analysis. The documents reviewed included the Strategic Plan for Community Development and the Mine Closure Plan. The portions of these documents germane to the Social Management Plan are discussed below.

7.1 PTNNT Planning Documents Reviewed

As discussed above, two PTNNT-developed planning documents were reviewed to ensure the mitigation strategies developed for this Social Management Plan were consistent. These included the Community Development Program Strategic Plan for 2009-2013 and the Mine Closure Plan. These planning documents are discussed further below.



7.1.1 Community Development Program Strategic Plan (2009-2013)

PTNNT Community Development Program (ComDev) developed and is implementing an extensive strategic plan for community development in the sub-districts of Maluk, Jereweh and Sekongkang for the operational period 2009 – 2013 (PTNNT 2009e) that includes provisions for addressing social impacts. The vision and mission of the Community Development Program are as follows:

Vision: Develop a healthy, smart, self-sufficient, prosperous and religious community.

Mission: o Improve the quality of health human resources. o Improve the quality of smart and productive human resources. o Encourage and facilitate the creation of business opportunity and community economic

activities. o Develop the natural potential of the area to an optimal, competitive and sustainable level. o Develop art, cultural and religious values in the effort of attaining a harmonized civil

society. The strategic objectives of the Program include the following:

Infrastructure Development: In partnership with the government, this program is intended to reduce PTNNT impact on local facilities by improving infrastructure and public facilities which, in turn, promote economic and social development. Since 1997, PTNNT has been involved in a comprehensive community development program focused on development in the 15 villages of the three sub-districts within its Area of Influence:

o Jereweh, including the villages of Dasan Anyar, Goa, Belo, Beru; o Sekongkang, including the villages of Sekongkang Atas, Sekongkang Bawah, Tongo, Ai’

Kangkung, Tatar, Talonang Baru Village; and, o Maluk. including the villages of Benete, Maluk Loka, Mantun, Pasir Putih, and Bukit Damai.

Public Health: This development strategy aims to improve basic health standards through health education programs focused on reducing infectious diseases and children and pregnant women nutrition through the activities of the posyandu (integrated services post) and local health clinics (puskesmas).

Education: This strategy objective is to improve basic skills and primary formal education of the community in partnership with the government and active participation from the community.

Agriculture and Small Business Development: This strategic objective is intended to guarantee continuous household sources of income through the development of advanced, integrated and value added agricultural practices, and through competitive business skill training to reduce unemployment and stimulate investment.

PTNNT partnered and consulted with the government, NGOs, academic institutions, private sector, donor agencies, communities and other parties to guarantee and promote a sense of ownership among the stakeholders. In this context, PTNNT supported the establishment of two foundations, Yayasan Olat Parigi (YOP) and Yayasan Pemberdayaan Ekonomi Sumbawa Barat (YPESB), which undertake several direct community development programs.



Most important in the strategic implementation of the above objectives and goals is the close partnership with the local communities. Community development programs are collaborated with local communities represented by a Village Delegate to develop transparent and interactive community development programs. The Village Delegates are a group of community leaders that bridge community interests with the PTNNT Community Development department. 7.1.2 Mine Closure Plan PTNNT’s Mine Closure Plan also stresses the importance of developing impact mitigation strategies to reduce mine closure impacts on local residents’ sources of income and the reduction of access to community development programs. As indicated in these plans, it is expected that the communities, with the support of the local administration, can implement independent and sustainable community development programs after mine closure by:

Continuing the maintenance process of infrastructure developed by PTNNT and transferred to the regional government and community business units,

Having the Foundations supported by PTNNT develop into independent institutions,

Continuing education development programs, and

Continuing public health programs.

These tenets were considered in developing the mitigation approaches identified in this Social Action Plan.

7.2 Social Impacts Mitigation Approach

In consideration of the analysis of impacts presented in Sections 5 and 6 and through review of the planning documents and programs described above, an overall approach to mitigating identified social issues associated with the Project was developed. This approach is presented in Table 7.1 which summarizes the potential impacts identified, proposed mitigation measures, and any additional actionrequired is provided. In addition, the table includes a schedule to implement the proposed mitigation, capital cost estimates, and recurrent cost estimates as well as proposed funding sources for the mitigations. The majority of impacts identified will be mitigated by the continuation of existing PTNNT programs, primarily developed and implanted by the External Relations Department. These include programs include the Community Development Program and the Community Relations Program.



Table 7.1 - Summary of Potential Impacts and Mitigation Measures Potential Impacts of Batu Hijau Mine



Desired Outcome Schedule Estimated Cost PTNNT Responsible Department

Population and Demographic Shift – See Section 6.1 For Details Natural population increase can be accommodated.

None required by PTNNT None required by PTNNT Not Applicable Not Applicable Not Applicable Not Applicable

Population will contract as the Project approaches closure and reclamation.

None required by PTNNT None required by PTNNT Not Applicable Not Applicable Not Applicable Not Applicable

Change in Economic Environment – See Section 6.2 For Details Need for Indonesian job creation and retention in accordance with the CoW.

Continue with strategy to replace expatriates as qualified Indonesian candidates as they become available.

Continue employment strategy

Contract compliance On-going Not Applicable Mine Management Human Resources Department

Need for contracted services will begin to diminish as the Project approaches closure and reclamation.

Diversify suppliers, vendors and local communities to promote other economic opportunities.

Continue to work with Local Business Initiative partners and seek new opportunities to diversify.

Sustainable economic development in the absence of mining.

On-going in conjunction with 5 year Strategic Plan.

To be determined though the period of mine closure and reclamation.

Community Relations Community Development Purchasing and Contract Departments Mine Closure Group

Direct and indirect employment will be reduced as Project approaches closure and reclamation.

Tax and royalty payments to the government will reduce as Project approaches closure and reclamation.

Identify current amounts of local funding derived from Government based on PTNNT mining activities. Identify alternative funding sources for programs and services.

Research alternative funding schemes. May include concepts such as enhanced property ownership documentation.

Local programs and services remain sustainable at the conclusion of mining. Loans on titled property could enhance access to credit.



Governmental Relations







PTNNT programs to provide services and foster economic development may become unfunded as the Project approaches closure and reclamation.

Identify alternative funding sources for programs and services.

Research alternative funding schemes.

Local programs and services remain sustainable at the conclusion of mining.




Natural Resource Management – See Section 6.3 For Details Government may change existing or apply additional regulatory constraints to the Project. PTNNT may make changes to the mine plan requiring additional regulatory review.

Continue External Relations program to ensure the government stays informed about the Project and its benefits.

Continue External Relations program.

No future regulatory or contractual changes that may impact Project efficiency.

On-going To be Determined Government Relations

Adequacy of Social Infrastructure and Services – See Section 6.4 For Details PTNNT financial support for education and health programs will reduce as Project approaches closure and reclamation.

Identify alternative funding sources for programs and services. May include PTNNT bonds or other financial commitments from PTNNT, the government or others.

Research alternative sources of funding.


Immediately, as prioritized using community investment histories and in conjunction with 5 year strategic plan.



Financial support for maintenance of existing infrastructure as required for farming and water delivery will reduce as Project approaches closure and reclamation.







Project closure and decommissioning may bring additional opportunities (i.e.: for local power generation and sales revenue).

Identify alternative funding sources for programs and services that may use additional elements resulting from mine closure.

Continue to incorporate transitional activities into Mine Closure Plan and Community Relations Strategic Plan.


On-going To be determined though the period of mine closure and reclamation.

Community Development Mine Closure Group Technical Service Department Power Plant Department

Vulnerable Groups – See Section 6.5 For Details Transmigration communities may need continued assistance.

Continue to include officials of the transmigration communities in the community relations program to identify future problems.


Communities are fully integrated and self sustaining.

On-going To be determined though the period of mine closure and reclamation


Future relocation of additional Muslim and non-Muslim transmigrants by the Government of Indonesia.

Continue to work with Indonesian government.

None required by PTNNT Population stability On-going To be determined Government Relations

Cultural Property – See Section 6.6 For Details No PTNNT impacts identified None required by PTNNT None required by PTNNT Not Applicable Not Applicable Not Applicable Not Applicable Social Conflict – See Section 6.7 For Details Jealousy of PTNNT employees. Continue to rehabilitate non-

employee housing. Continue community relations program.

Population stability On-going in conjunction with 5 year Strategic Plan.



Continue to make infrastructure investments which benefit all residents.

Outsiders coming for employment.

Continue to sensitize local residents regarding job availability and requirements.


Short-run employment stability until closure and reclamation.

On-going As budgeted Community Relations

Continue to sensitize employees to local culture and expectations.







Jealousy of transmigrants for receiving land.

No action available to PTNNT to respond to a government program.

None required by PTNNT Not Applicable Not Applicable Not Applicable Not Applicable

Increase in crime including prostitution.

Monitor crime statistics and work with local law enforcement.

Develop a partnership with local law enforcement.

Decrease in trend. On-going As budgeted Safeguards and Security

Lack of communication with local residents.

Improved communications with community residents.

Continue and strengthen community relations interactions with communities by holding community meetings each month.

Better communication with communities.


To be determined though the period of mine closure and reclamation and beyond mine closure.

Government Relations Community Relations Community Development

Consider improved staffing of PTNNT community offices through better coordination or merge of Community Relations and Community Development.

Better Monitoring and Evaluation outcome of people effected by the Project and after closure and reclamation.

On-going in conjunction with 5 year Strategic Plan and after closure and reclamation.

Changes in Lifestyles and Culture – See Section 6.8 For Details No PTNNT impacts identified None required by PTNNT Maintain respect for local

lifestyles and culture. Not Applicable Not Applicable Not Applicable Not Applicable

Gender Equity – See Section 6.8 For Details No PTNNT impacts identified None required by PTNNT None required by PTNNT Not Applicable Not Applicable Not Applicable Not Applicable Closure and Rehabilitation – See Section 6.10 For Details Post mining land use and settlements

As listed in the Mine Closure Plan (PTNNT 2009).

Regular updates of Mine Closure Plan.

Optimum land use after mining.

As presented in the Mine Closure Plan (PTNNT 2009).

As presented in the Mine Closure Plan (PTNNT 2009).

Mine Closure Group Technical Service Department Environmental Department







Maintaining sustainable development and infrastructure programs.

Community Development Plan based on health, education, community welfare and suitable infrastructure.

Regular updates and success evaluation of Community Development Plan.




Community Development

Reduced employment and economic opportunities.

Community Development Plan which focuses on a partnership approach between PTNNT, government and other relevant stakeholders.

Continue to research sustainable development activities for communities.

Short-run employment stability until closure and reclamation.



Government Relations Mine Closure Group



7.3 Mitigation Funding

For the period starting in 2000 until June 2009, PTNNT spent US$44.3 million on community development which includes donations of approximately US$7.9 million. The average annual budget for community development is US$5.6 million per year with a typical utilization ratio of 76 percent for a program and 24 percent go to administrative costs associated implementing the program. In 2010, PTNNT has budgeted US$827,900 for community capacity building which includes the development areas of health – US$110,000, education – US$380,000, integrated agriculture – US$167,00 and local business/YPESB programs for economic development and education – US$430,900 (PTNNT 2009g). It remains uncertain the level of funding PTNNT will budget for community development funding through mine closure. Recommend PTNNT prepare an estimated future funding budget through closure and into monitoring and evaluation for the purposes of mitigation funding to include monitoring and evaluation activities beyond the life of the Project. Increased efficiency of the Community Development Program may be realized if PTNNT were to consider merging the Community Development and the Community Relations groups in order to ensure the most efficient use of manpower and funding. This merger seems logical as the role of Community Development should begin to decrease at this stage in the Project. This merger would also improve the collaboration of staff in meeting the needs of the communities.

7.4 Mitigation Team Organization

The overall organization to support implementation of this Social Management Plan will be considerate of the existing structure of PTNNT. Community Development and Community Relations are both part of the External Relations Department, an integral part of the Mine Closure Organization. As described in the Mine Closure Plan, the organization will be led by a President Director and Mine Closure Manager to ensure the mine closure program is implemented according to the plan. The management will be supported by an administrative team including a financial team. The following are the five proposed departments that will be instrumental in implementing this plan:

Technical Service Department will conduct the major activities for the first four years of closure which will mainly cover civil works for ex-mine footprint closure, ex-process facilities, and ex-support facilities planned to be closed including geotechnical support work. Land preparation activity for reclamation in some part of ex-ore stockpile, ex-sediment ponds, and ex-process and support facilities will also be covered by this department. The team is limited and supported by local contractors.

Environmental Department is a main department which will be working on the Batu

Hijau Project until 2048 to conduct reclamation work (first four years), water management, and environmental monitoring. Water management will focus on management of Pit Lake and waste dump seepage.

Power Plant Department will be operating the power plant at Benete including port

operation to support mine closure activity. The power plant operation may be taken over by government or electric company depending on closure agreement.

Facility and Service Department will support other department in term of labor supply /

contractor, materials required in mine closure operations and maintain few facilities to support mine closure. The function of the department will be reduced with time and ultimately replaced by a foundation.



External Relations Department will mainly work with local, province and national governments; Community Relations and Community Development; and Asset Protection of some facilities to support mine closure. The Community Development team will work together with a foundation established by stakeholders in the first five year as a transition to ensure community development component of the mine closure program is implemented.



8.0 REFERENCES

AMEC 2008. Batu Hijau Project, Sumbawa, Indonesia: Field Investigation - Due Diligence Report, Social Management and Public Consultation. October.

Central Intelligence Agency (CIA) 2009. The World Fact Book. Indonesia. Available on-line at:

https://www.cia.gov/library/publications/the-world-factbook/. Dames & Moore 1995. Technical Report, Socio-Economic and Socio-Cultural Environment. July. Equator Principles 2006. A Financial Industry Benchmark for Determining, Assessing and

Managing Social & Environmental Risk in Project Financing. July. Available on-line at http://www.equator-principles.com/.

Extractive Industries Transparency Initiative (EITI) 2003. The EITI Principles and

subsequent Validation Methodology (2007). Available on-line at: http://eitransparency.org/. Earthstone 2009. Operations: Why Indonesia? Available on-line at:

http://www.earthstoneresources.com. Five Star 2006. Five Star Community & External Relations Assessment of Newmont Batu Hijau

Operations, June. Food and Agricultural Organization (FAO) 2009. United Nations, Disasters in Asia and the

Pacific: An Overview. Available on-line at: http://www.fao.org/. GOI_UNICEF 2000. Challenges for a New Generation: The Situation of Children and Women of

Indonesia, Country Strategy Paper. Hillebrand V. and Woloson E 1996. Baseline Study: Communities Surrounding the Batu Hijau

Mine, Sumbawa, Indonesia International SOS (AEA) for PTNNT Newmont Indonesia. International Council on Mining and Metals (ICMM) 2003. 10 Principles. May. Available on-

line at: http://www.icmm.com/. International Finance Corporation (IFC) 2006. Performance Standards on Social and

Environmental Sustainability. April. Available on-line at http://www.ifc.org/. International SOS 2008. Newmont Public Health and Malaria Control - Annual Report 2008: Five

Year Strategic Plan 2009 – 2013. Kabupaten Sumbawa Dalam Angka 1994. Sumbawa Regency in Figures. _______ 2004. Sumbawa Regency in Figures. _______ 2007. Sumbawa Regency in Figures. _______ 2009. Sumbawa Regency in Figures.



LPEM-FEUI 2006. Economic and Social Impacts of PT. Newmont Nusa Tenggara (NNT) on the Province of Nusa Tenggara Barat and Kabupaten Sumbawa Barat. Lembaga Penyelidikan Ekonomi dan Masyarakat, (Institute for Economic and Community Studies), School of Economics, University of Indonesia, Jakarta. December.

Maluk Sector Police 2009. 2008 and 2009 Maluk Police Report. August. Newmont 2009. Latest News: Newmont and Sumitomo Complete 10% Share sale of PTNNT for

$391 Million; Government Acknowledges PTNNT has complied with its Divestiture Obligations. Available on-line at: http://www.newmont.co.id/EN/media_center_detail.cfm?type=1&lang=en&id=142.

NTB 2009. Nusa Tenggara Barat in Figures 2009. BAB III: Population, Labour Force and

Transmigration. Available on-line at: http://ntb.go.id/ntb_angka2009/bab3.pdf _______ 2009b. Nusa Tenggara Barat in Figures 2009. BAB IV: Social. Available on-line at:

http://ntb.go.id/ntb_angka2009/bab4.pdf PPLH Unram 2006. Pengawasan Pembangunan dan Lingkungan Hidup, Universitas Mataram. _______ 2007. Pengawasan Pembangunan dan Lingkungan Hidup, Universitas Mataram. _______ 2008. Pengawasan Pembangunan dan Lingkungan Hidup, Universitas Mataram. PTNNT 1996. Integrated Environmental Impact Assessment, Main Report: Batu Hijau Copper –

Gold Project, Jereweh District, Sumbawa Regency, Nusa Tenggara Province, Indonesia. July. _______ 2009. Mine Closure Plan. Batu Hijau Copper – Gold Project, Jereweh District, Sumbawa

Regency, Nusa Tenggara Province, Indonesia. July. _______ 2009b. Community Development (ComDev) Project Data. August. _______ 2009c. Human Resources Department Project Data. August. _______ 2009d. Environmental Management and Monitoring Implementation Report. December. _______ 2009e. Strategic Plan: Community Development in Sub-Districts Maluk, Jereweh and

Sekongkang, Year 2009 – 2013. _______ 2009f. 2009 Work Plan and Budget. _______ 2009g. Community Development by PT Newmont Nusa Tenggara, Presented at DPPMB

– Ministry of Mining and Mineral Resources, Jakarta. October. Robinson S. 1998. Community Heal Site Survey Batu Hijau Project on East Sumbawa, East Nusa

Tenggara Indonesia, prepared for PT Newmont Nusa Tenggara: Community Outreach Initiatives, AEA International.

Salim 2003. Striking a Better Balance: The World Bank and Extractive Industries, pp. 1-92, Vol 1. United Nations (UN) 2009. The Millennium Development Goals Report. 2009.

Available on-line at: http://www.un.org/millenniumgoals/index.shtml.



University of Indonesia 2009. Community Health Assessment Study in selected sub-districts of west Sumbawa, Nusa Tenggara Province, Indonesia. Prepared collaboratively by The University of Indonesia, The University of Mataram and International SOS, Jakarta. 2009.

USGS 2009. United States Geological Service, Indonesia Volcanoes and Volcanics. Available on-line

at: http://vulcan.wr.usgs.gov/. World Health Organization (WHO) 2009. County Cooperation Strategy - Indonesia.

Available on-line at: http://ino.searo.who.int/EN/Index.htm. World Bank Group (WBG) 2009. Country Partnership Strategy for Indonesia FY 2009-2012.

Investing in Indonesia’s Institutions for Inclusive and Sustainable Development. Available on-line at: http://www.worldbank.org/

Appendix A

NEWMONT ASIA PACIFIC SOCIALNEWMONT ASIA PACIFIC SOCIALRESPONSIBILITY POLICY AND RESPONSIBILITY POLICY AND

UPDATED DRAFT SOCIAL RESPONSIBILITYUPDATED DRAFT SOCIAL RESPONSIBILITYSTANDARDSSTANDARDS

SOCIAL RESPONSIBILITY

STANDARD

Table of Contents

This document is uncontrolled in hard copy format Last printed XXX

NEM-SR-S.00 Version 1.0

Issue date: Dec 18 2009 Page 1 of 1

NEM-SR-S.01 Social Baseline Studies v1.0 NEM-SR-S.02 Social Impact Assessment v1.0 NEM-SR-S.03 Stakeholder Mapping v1.0 NEM-SR-S.04 Stakeholder Engagement v1.0 NEM-SR-S.05 Expectation and Commitment Management v1.0 NEM-SR-S.06 Complaints-Grievances Management v1.0 NEM-SR-S.07 Monitoring and Evaluation v1.0 NEM-SR-S.08 Local Community Investment v1.0 NEM-SR-S.09 Security and Human Rights v1.0 NEM-SR-S.10 Land Acquisition and Resettlement v1.0 NEM-SR-S.11 Management of Cultural and Heritage Sites v1.0 NEM-SR-S.200 Glossary v1.0

DOCUMENT CONTROL

Version Date Author Approved 1.0 December 19, 2009 ESR Global Team Dave Baker


STANDARD

Social Baseline Studies




1. PURPOSE

To set the minimum requirements for collecting baseline information that describes the comprehensive social context and characteristics of the populations living near Newmont sites.

2. RATIONALE

Comprehensive social baseline information provides the foundation for Newmont’s understanding of local community cultures, norms, behaviors, decision-making and development processes, and comprises the data against which Newmont’s (social, health, environment, economic, human rights) impacts and contributions to sustainable development will be measured. A thorough understanding of the local communities near our sites provides the basis for informed and respectful engagement processes, mitigation plans, and development programs.

3. SCOPE


4. STANDARD

4.1. Relevant social and economic information will be collected beginning in the

exploration phase, as appropriate to the scale of activity and potential impacts (positive or negative).

4.2. Impacts shall be analyzed in the context of the site’s area of influence.

4.3. Collected information will be stored in electronic database format and reviewed

for accuracy on a regular basis. 4.4. Household and community surveys shall be undertaken only by those with

specific training for this type of exercise, in collaboration with local partners to ensure that the process is conducted with sensitivity for local culture and concerns.

4.5. Household and community surveys shall be undertaken only with the consent of

the people from which information is being collected.


STANDARD





4.6. Data shall be reviewed and updated at least every five years, or as changes in

the social or site context warrants more frequent review. 4.7. For properties acquired by Newmont, a review against this standard will be conducted

to determine whether an updated baseline study is warranted, and if necessary, be completed within 12 months of acquisition.

4.8. Information collected shall be used for the assessment of potential impacts, the

elaboration of social development programs, and other site plans. It is expected that the information will be used to measure successes, failures and opportunities for improvement with implementing all of the Social Responsibility standards. For example, it shall be used for, but not limited to:

Land access and acquisition practices Land and resource-use planning Project planning, including project design and mitigation opportunities Cross-cultural training and cultural heritage protection programs Community investment programs Local employment and training strategies Local supplier development (supply chain linkages) Closure criteria and post-mining land-use planning

4.9. Methodologies

4.9.1. The methodology used to collect information will be commensurate with the phase of site development.

4.9.2. During exploration, the information may be collected using existing

qualified internal capacity or external third parties, using a methodology such as rapid rural appraisal and desk-top analysis (see Supporting Documents).

4.9.3. Formal and comprehensive baseline studies shall be undertaken by

experienced third parties. These formal studies shall include both qualitative and quantitative data, based on both an investigation of existing credible documentation and household surveys prior to selecting a final project alternative.

4.9.4. The direct surveying for health data shall be undertaken as close to the

start of construction activities as possible.

4.9.5. To prepare for effective monitoring of the impact of closure, the social baseline data shall be reviewed and updated one year prior to the cessation of operations and five years post-operational cessation.


STANDARD





4.10. Key Elements

4.10.1. Social baseline studies shall include at a minimum, but are not limited to, the following elements, which may vary according to the anticipated impacts of the proposed activity and a thorough risk assessment:

Anthropologic study

Culture (regional and local) Values Religion World view Inter-community relationships Existing conflicts Traditional knowledge Sacred Sites

Socio-economic (regional/local, macro/micro)

Livelihoods Demographics Supply chain capacity Infrastructure Leadership (control, decision-making practices, planning and

implementation capacity) Education and skills level Asset survey Resource utilization patterns and dependence

Government Credibility/legitimacy Corruption Political risk Planning and Implementation Capacity Security forces

Health – current exposure levels or concerns regarding:

Respiratory and vector-related diseases Sexually transmitted diseases Soil- and water-borne diseases Food and nutrition Accidents and injuries Exposure to potentially hazardous materials Psychosocial Cultural health practices Health services infrastructure and capacity


STANDARD





Program management delivery systems Land Use and Ownership

Cadastral surveys Ownership (titled and/or customary) Land and resource use (for cultural or livelihoods purposes) Land acquisition/transfer processes – formal/informal,

documented/understood History

Perception of industry/industrial activities/Newmont Cultural history Community – in migration, how did the community come to

be? Archeology Corruption Communication systems “External” actors

NGOs Churches Other industry

Human Rights context/conditions

5. KEY WORDS IN GLOSSARY Area of influence Baseline information Closure Closure criteria Community investment 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Socio-Economic Assessment Toolbox (SEAT), Anglo-American Conflict-Sensitive Business Practice: Guidance for Extractive Industries, International Alert, March 2005


STANDARD





8. REFERENCES Nil 9. DOCUMENT CONTROL

Version Date Author Approved

1.0 December 19, 2009 ESR Global Team Dave Baker


STANDARD

Social Impact Assessment




1. PURPOSE

To provide the minimum requirements for identifying and evaluating social impacts, both adverse and beneficial, related to a site’s area of influence, in order to provide an informed analysis upon which to develop and implement effective short- and long-term mitigation and development plans.

2. RATIONALE

By conducting thorough and timely social impact assessments, Newmont will be able to more accurately estimate site risks and address them in a timely and cost-effective manner. Impact assessments also allow Newmont to identify opportunities for sustainable contributions to support local socio-economic development and enhance the value of the site to the local community.

3. SCOPE


4. STANDARD

4.1 Impacts and risks to be assessed shall include, but are not limited to: community health and safety; quality, availability and use of land, natural resources and raw materials

(inclusive of flora, fauna, ecosystems and biodiversity, soil, water, air, climate and landscape;

protected areas and sites of cultural, heritage, or religious significance; local and regional infrastructure and civil support services; heritage, recreation and amenity assets; livelihoods, lifestyle, human rights, and well being of affected communities.

4.2 An assessment of potential positive and negative impacts that the site may bring to

local, regional, and national communities shall be undertaken. 4.3 Impacts shall be assessed against baseline information collected according to the

Social Baseline Studies Standard. Where baseline data does not exist, is outdated, or considered incomplete or compromised, Newmont will undertake studies to provide a comprehensive suite of baseline information, scaled to the level of anticipated site activity, prior to undertaking the impact assessment.


STANDARD





4.4 For properties acquired by Newmont, a review against this standard will be

conducted to determine whether an impact assessment is warranted, and if necessary, be completed within 12 months of acquisition.

4.5 Impacts shall be analyzed in the context of the site’s area of influence. 4.6 Impacts shall be considered in the context of the mine life cycle, to the extent that the

life cycle can be anticipated and defined. The assessment shall be inclusive of both short- and long-term impacts as well as primary and secondary impacts and adverse and beneficial impacts.

4.7 Special attention will be paid to ensure that the needs of community members that

may be disproportionately affected by site activities (e.g., socially vulnerable community groups or specific resource-dependant groups) are identified and addressed.

4.8 Social impact assessments shall be conducted:

Prior to the initiation of a project alternatives analysis; Updated after the preferred alternative is selected; Updated five years after commencement of operations (first ore to primary

crusher) and every five years thereafter during the operations phase of a site; and

Updated three years prior to decommissioning (closure focus).

4.9 Impact assessments shall be conducted more frequently than defined above if deemed necessary based on the risks specific to the site, or where there has been significant change to the social context or site footprint.

4.10 Assessments shall be undertaken by independent subject matter experts with

experience in impact assessment related to the mining industry. 4.11 Assessments shall include an analysis of technically and financially feasible

alternatives to the identified source of impacts, and the rationale for selecting a single preferred alternative.

4.12 An assessment report shall be prepared and will comprise:

Description of the local context/environment (baseline) Site description Identification of potential adverse and beneficial impacts Evaluation of alternatives including the “no go” alternative Consideration of cumulative impacts Recommendations for mitigating and managing impacts Monitoring and review systems to evaluate the effectiveness of the impact

management plans.


STANDARD





4.13 External stakeholders will be consulted throughout the assessment process. In

particular, the assessment process will include the participation of affected communities. Participation will be designed to ensure that the process is inclusive, accessible, free of external manipulation, and undertaken in a culturally appropriate manner.

4.14 Stakeholders shall be provided with opportunities to express their views on potential

site risks, impacts, and mitigation measures. Stakeholder concerns shall be documented and addressed during the assessment process and within the assessment reports in an open and transparent manner.

4.15 Final assessment reports shall be made publicly available and available to local

communities in a culturally appropriate manner. A copy shall be provided to site, regional, and corporate managers.

5. KEY WORDS IN GLOSSARY Impact Impact assessment Local community Baseline information Stakeholder 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Addressing the Social Dimensions of Private Sector Projects. IFC Good Practice Note, December 2003, No. 3. IFC Performance Standard 1 and Guideline: Impact Assessment, July 2007 Socio-Economic Assessment Toolbox (SEAT), Anglo-American Community Development Toolkit, ESMAP, ICMM and World Bank, 2005 8. REFERENCES Nil


STANDARD





9. DOCUMENT CONTROL



STANDARD

Stakeholder Mapping




1. PURPOSE

To define minimum requirements for the identification of people and groups (stakeholders) who have an interest in Newmont activities relative to their needs and interests, relative power and legitimacy, and relationships between them which can serve as a guide to the development of effective engagement mechanisms and strategies.

2. RATIONALE

A thorough understanding of a site’s stakeholders provides the basis for effective engagement, and is the starting point for understanding points of access, support, negative perceptions of the site, and areas of conflict. A thorough and regularly updated stakeholder map will inform:

Engagement and communications planning; Impact assessments; Conflict management processes; Community investment plans.

3. SCOPE


4. STANDARD

4.1 Stakeholders that may affect, or be affected by, Newmont’s site activities shall be identified.

4.2 For each stakeholder or stakeholder group, identification shall include:

Whether the stakeholder is directly or indirectly impacted by the site activity; Whether the stakeholder is impacted negatively or positively by the site

activity; Whether the stakeholder supports, is neutral, or is opposed to the site activity; Each stakeholder’s key interests and concerns in relation to the site activity; Their power/influence, legitimacy, and urgency in relation to the site.

4.3 Such information, if not known through direct interaction with the stakeholders, will be gathered, as appropriate, from relevant and credible sources.

4.4 Relationships between stakeholders shall be identified and assessed as to their

strength and points of influence, as well as identifying areas of existing commonality or conflict.


STANDARD

Stakeholder Mapping




4.5 A conflict assessment shall be undertaken prior to or as soon as reasonably practical after entering a site area (see Supporting Documents).

4.5.1 The conflict assessment shall comprise the following key components:

Identification of existing issues or areas of conflict between stakeholder groups.

Identification of issues or potential areas of conflict that the site activity may create or exacerbate.

Identification of power relationships between stakeholders Mapping of site activities and personnel who will be interacting with

stakeholders at those points of conflict. Recommended mitigation activities that may be undertaken to prevent

(where possible) or minimize conflict due to Newmont’s presence muest be incorported into a site’s stakeholder engagement plan (See External Stakeholder Engagement Standard)

4.5.2 The conflict assessment shall be reviewed and updated on a bi-annual

basis.

4.6 The exercise of identifying stakeholders shall ensure that marginalized or vulnerable groups are identified.

4.7 The outcomes from 4.2 and 4.4 above shall be validated through direct interaction

with the relevant stakeholders, where possible.

4.8 This information, or “map,” shall be documented in an electronic and accessible format and reviewed/updated at least annually, and prior to and after any significant change in site activity or incident.

5. KEY WORDS IN GLOSSARY Conflict Stakeholder Impact assessment Community investment 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Community Development Toolkit. ESMAP, World Bank & ICMM, 2005. The Stakeholder Engagement Manual, Vol. 2: The Practitioner’s Handbook. AccountAbility and UNEP, 2005.


STANDARD

Stakeholder Mapping




Conflict-Sensitive Business Practice: Guidance for Extractive Industries, International Alert, March 2005 8. REFERENCES Nil 9. DOCUMENT CONTROL




STANDARD

External Stakeholder Engagement




1. PURPOSE

To define the minimum requirements for planning, implementing, and monitoring stakeholder engagement practice, as the basis for developing and maintaining constructive, long-term relationships and minimizing potential risks to Newmont’s activities.

2. RATIONALE

A forward-looking, well-informed and proactive approach to engaging with external stakeholders provides Newmont with the opportunity to gauge interests, concerns, and perceptions about our activities, seek out common ground, address areas of existing or potential conflict as early as possible, and build a foundation of trust with local communities. Successful engagement with external stakeholders will contribute to expectations being managed, misperceptions corrected, and planning processes developed that will maximize Newmont’s contribution to sustainable development.

3. SCOPE


4. STANDARD

4.1 Behavior

4.1.1 Engagement activity shall be undertaken in an informed and culturally appropriate manner, based on the knowledge gained through conducting stakeholder mapping and social baseline studies (see Stakeholder Mapping Standard and Baseline Studies Standard)

4.1.2 Newmont personnel shall be trained in basic interpersonal communications

skills to ensure that behaviors honor local norms, rules, and systems, and promote active dialogue and listening.

4.1.3 Newmont personnel with direct job responsibilities for stakeholder

engagement and conflict management shall receive advanced training in interpersonal communications skills to assist them in instances of conflict and dispute resolution.

4.1.4 Complaints regarding personnel behavior will be monitored on a regular

basis. Managers shall demonstrate and promote good behavior through incentives and constructively correct poor behaviors through informal channels and a formal documented process.


STANDARD





4.2 Engagement Planning, Activity, and Record Keeping

4.2.1 A documented stakeholder engagement plan shall be developed for each site

and region, and will comprise: Identification of stakeholders to be engaged (in order of priority/urgency

according to risk analysis) Identification of key issues, concerns, and interests of the stakeholders Recommended mitigation activities to prevent or minimize conflict

(derived from the conflict assessment described in the Stakeholder Mapping Standard)

Approaches to be used to address issues, concerns, and interests Engagement mechanisms, schedule and/or timeline, and frequency Objectives of the engagement Measures of engagement success Potential personnel impact on the implementation or outcomes of the

proposed engagement activity Internal company contact(s) responsible for undertaking the engagement Resource requirements

4.2.2 Engagement plans shall be informed through collaboration with the

stakeholders to be involved in the engagement activity.

4.2.3 Necessary and relevant site information shall be made available to stakeholders to ensure an informed engagement process, and in accordance with considerations of the accessibility of the information to diverse audiences.

4.2.4 A set of agreed-upon core messages about site activity shall be developed, to

ensure consistency throughout all engagement activity. Such messaging shall be conveyed to all personnel that will be involved in or may potentially affect the engagement activity.

4.2.5 Stakeholder engagement plans shall be reviewed quarterly to evaluate

progress against the measures of success and identify any gaps or underperformance. Where gaps or underperformance are identifed, corrective action plans will be developed and implemented. Corrective actions will be captured in the facilities corrective action system.

4.2.6 Where deemed necessary and appropriate, resources (financial or in the form

of expertise, training, or technical/logistical support) shall be made available to external stakeholders to allow them to engage effectively.

4.2.7 Where marginalized and vulnerable groups have been identified, procedures

shall be developed and implemented to ensure these groups are engaged. .

4.2.8 All formal engagements shall be documented via a process whereby the minutes are shared and approved by the attendees (see the Expectations and Commitments Management Standard).


STANDARD





4.2.9 Where decisions and/or commitments are made by Newmont during the

course of stakeholder engagement, the commitment shall be entered into the site’s commitment register and an implementation plan developed to ensure that Newmont responsibilities are fulfilled (see the Expectations and Commitments Management Standard).

4.2.10 Complaints or grievances voiced by stakeholders shall be documented and

managed according to the Complaints and Grievances Management and Resolution Standard.

4.2.11 A knowledge, attitude and perception survey shall be conducted at least

annually for stakeholder groups identified in the engagement process to determine the level of satisfaction with the operation, engagement and the level of success achieved.

5. KEY WORDS IN GLOSSARY Stakeholder Risk Complaint Grievance Local community Marginalized or vulnerable groups 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Stakeholder Engagement: A Good Practice Handbook for Companies Doing Business in

Emerging Markets. IFC, 2007. Community Development Toolkit. ESMAP, World Bank & ICMM, 2005. The Stakeholder Engagement Manual, Vol. 2: The Practitioner’s Handbook. AccountAbility

and UNEP, 2005. 8. REFERENCES Nil


STANDARD





9. DOCUMENT CONTROL




STANDARD

Expectation and Commitment Management




1. PURPOSE

To ensure a system is in place to manage stakeholder expectations and commitments between Newmont and stakeholders related to the activities of the company with the aim of supporting the development and management of relationships.

2. RATIONALE

Stakeholder expectations of Newmont can be varied and highly complex, and can be formed even in the absence of communication from Newmont about what it is able to provide or do. Unmet expectations and unfulfilled commitments can be a significant source of ill will between the company and community, and can increase the risk of social conflict and the loss of community support for a mining project. Management systems and processes that identify and manage expectations and ensure the fulfillment of commitments provide opportunities for increasing levels of trust and credibility.

3. SCOPE

This standard is applicable to Newmont owned and managed operations and properties at all phases of the mine life cycle, including exploration, design, construction, operation and closure. This standard speaks to an aspect of stakeholder engagement and therefore shall be read in conjunction with the Stakeholder Engagement Standard.

4. STANDARD

4.1 Expectation Management

4.1.1 Mechanisms shall be defined and implemented to identify and document communities’ expectations of the company at the earliest possible phase of activity and throughout the life of the mine.

4.1.2 Where it is determined that Newmont should respond positively to meet a defined

expectation, the proposed response will be logged as a commitment in the Commitment Register (see 4.2.7 below).

4.1.3 Where it is determined that Newmont should not respond positively to address an

expectation, a clear reason or justification shall be documented.


STANDARD





4.1.4 A communication plan shall be developed and implemented to provide a response (positive or negative) to the source of the expectation in a timely fashion.

4.1.5 Where it is determined that this expectation is likely to recur, efforts will be made

to ensure that the communication plan is applied over the appropriate time frame in a consistent fashion.

4.1.6 Ongoing engagement with the stakeholder shall be undertaken to monitor how

the response is received, and whether ongoing concerns or unchanged expectations may escalate into increased social conflict. Such engagement shall be incorporated into the larger site-wide engagement plan for effective long-term monitoring.

4.2 Commitment Management

4.2.1 Individual Newmont personnel at the site level shall be identified for the purpose

of holding the authorization to make commitments. 4.2.2 Commitments made by Newmont shall comply with the Partnering Against

Corruption Initiative (PACI) and company guidelines regarding anti-corruption.

4.2.3 Commitments made on behalf of Newmont that require financial resources must have prior budget approvals and be aligned with the Community Relations Strategic Plan.

4.2.4 Commitments shall be defined in a SMART manner (Specific, Measurable,

Achievable, Relevant and Time-Bound) and agreed with the communities.

4.2.5 A specific procedure shall be developed which identifies how commitments will be established and formalized with stakeholders. The commitment procedure will be developed in consultation with appropriate stakeholder groups and internally/externally disclosed to ensure the procedure is understood and generally accepted.

4.2.6 A commitment register shall be developed and maintained at initiation on

Newmont activity and maintained throughout the life of the site. Where an existing site does not have a commitment register, efforts shall be undertaken to identify and document existing commitments in a formal register.

4.2.7 The commitment register shall include:

Definition of the commitment Resources and activities required to fulfill the commitment


STANDARD





Identification of individuals/functions responsible for undertaking the activities

Timeframe for fulfillment of the commitment Monitoring measures to track the activity Date and evidence of final completion Evidence of stakeholder acknowledgment of final completion

4.2.8 The commitment register shall be reviewed on a monthly basis by site

management and at a regional level on a quarterly basis. Where actions to fulfill commitments are in arrears, corrective actions will be undertaken to ensure activities are brought back into compliance with a set timeframe. Communication will be undertaken with the relevant stakeholders to inform them of the status of activities.

4.2.9 Complaints or grievances related to unfulfilled commitments shall be referred to

the appropriate complaint management procedure (see Complaints/Grievances Management Standard).

4.2.10 All commitments shall be documented at the time they are made.

4.2.11 A process will be established for the public disclosure and regular review of

outstanding commitments and their current status by the relevant stakeholders.

4.2.12 The scope of the commitments agreed with community representatives shall be communicated to the larger community to ensure common understanding and manage expectations.

5. KEY WORDS IN GLOSSARY Stakeholder Local community Conflict Complaint Grievance Commitment Expectation 6. APPENDICES Nil


STANDARD





7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Community Development Toolkit. ESMAP, World Bank, and ICMM, 2005 Newmont International Anti-Corruption Compliance Manual, June 2006 8. REFERENCES Nil 9. DOCUMENT CONTROL




STANDARD

Complaint/Grievance Management and Resolution




1. PURPOSE

This standard sets forth the minimum requirements for defining and formalizing the management process and key procedures to understand, prioritize and manage complaints and grievances related to Newmont activities.

2. RATIONALE

Disputes (complaints and grievances) are a natural part of any human relationship, including that between mining companies and communities. However, complaints and grievances that are left unresolved or unmanaged can lead to increased risk of conflict including violence and threats to the well-being of local communities, as well as a potential to delay or stop site activity, prevent company access to resources, and may lead to the damage or loss of assets or injury to personnel. An integrated and active approach to resolving and managing complaints and grievances will significantly reduce these risks.

3. SCOPE


4. STANDARD

4.1 Complaint and Grievance Management

4.1.1 Procedures for the identification, tracking, and resolution of local community complaints and/or grievances related to site activity shall be developed for each Newmont site.

4.1.2 Such procedures shall be developed in collaboration with those stakeholders

who are the expected users of the procedures, to ensure that the mechanisms and their outcomes are perceived as:

Legitimate Accessible Predictable Equitable and responsive Protective of human rights Transparent Inclusive of local decision-making processes


STANDARD





Respectful of local cultural norms Empowering Proportional to the scale and impact of the site and local conditions Supportive of continuous improvement Enforceable

4.1.3 Individual employees will be identified to act as the primary liaisons with

communities for the receipt and resolution of complaints. These employees will be trained, as needed, in the procedures designed to manage and resolve complaints or grievances related to site activity.

4.1.4 Analysis of complaint and grievance statistics and trends, in combination with the

conflict assessment evaluation (See Stakeholder Mapping Standard), shall be used to monitor the effectiveness of such mechanisms.

4.1.5 Root cause analysis will be undertaken for all grievances requiring second or

third order procedures as defined below.

4.2 Complaint and Grievance Resolution

4.2.1 First Order Procedures – For the handling of those complaints that may be resolved between the site and the complainant, the following shall be established: A depository or points of access where stakeholders may make their

concerns known to the site. Such contact points may be a fixed community liaison office, key company employees, and/or other, as deemed appropriate to the local context to ensure accessibility.

Definition of eligibility criteria for acceptance of complaints Definition of levels of authority for Newmont personnel to resolve complaints

(e.g., grievance officer, community relations manager, or site manager). Where necessary, an internal committee of managers to review and resolve

complaints at levels of authority above that of field personnel. Written records of complaints, receipt of complaints to complainants, and final

resolution. Written explanation of policies and procedures, and other methods of

communication as deemed necessary to overcome any challenges of literacy or language.

Database enabled to track the complaint and process undertaken to investigate and resolve the issue of concern.

Review of progress made in resolving complaints, and corrective actions taken to resolve any gaps in performance.


STANDARD





4.2.2 Second Order Procedures – For the handling of those complaints that cannot be resolved directly by the site and complainant and may require referral to or involvement of other parties the following will take place:

As above, with the addition of the identification and use of external parties

who are qualified and willing to assist in the process of resolving complaints, such as government officials, traditional leaders or elders, trusted individuals within the community, local NGOs, or others.

4.2.3 Third Order Procedures – For the handling of those complaints that are not

resolved and must be referred to official agencies or judicial processes the following will take place:

As above, with the qualification that the procedure then will follow the

statutory procedures of the agency chosen to resolve the complaint.

4.2.4 Procedures shall clearly define the criteria for escalating complaints from one order to another.

4.2.5 Those personnel responsible for the implementation of the procedures shall

ensure that community members are informed and understand how to access the mechanisms, and are kept informed of the status of any complaints in process.

4.2.6 Where necessary, training or capacity building of local community members shall

be undertaken to ensure community participation in the design of the mechanism and its effective use.

4.2.7 Those personnel responsible for the implementation of the procedures shall

ensure that departments and/or individuals implicated in a complaint are informed and involved in the investigation and resolution, as necessary.

4.2.8 The status of all complaints and investigations entered into the complaints

procedures shall be monitored and reported to site management on a monthly basis.

4.3 Complaint and Grievance Management Communication

4.3.1 The complaint and grievance management and resolution process will be regularly communicated to local stakeholders.

4.3.2 Outcomes of the process will be regularly communicated to local stakeholders.


STANDARD





5. KEY WORDS IN GLOSSARY Stakeholder Local community Complaint Grievance 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Conflict-Sensitive Business Practice Toolkit: Guidance for Extractive Industries, International

Alert, March 2005 Addressing Grievances from Project-Affected Communities, IFC Good Practice Note, No 7,

September 2009 8. REFERENCES Nil 9. DOCUMENT CONTROL




STANDARD

Monitoring and Evaluation




1. PURPOSE

To define minimum requirements for monitoring and evaluation activity to ensure the ongoing, methodical collection and analysis of data on engagement and program activities to assess their success at achieving specified goals and objectives.

2. RATIONALE

Monitoring and evaluation are integrally linked to the planning and implementation process, through the Plan-Do-Check Act (PDCA) cycle. At its broadest, monitoring involves tracking, in a systematic way, the strengths and weaknesses of various programs and how the activities of the site are impacting – both positively and negatively - on local communities and stakeholder groups. Monitoring entails developing a mix of quantitative and qualitative indicators (preferably in consultation with community groups) and reviewing the data regularly. Key risk areas, such as human rights and compliance with agreements and legal requirements, also require ongoing monitoring. Evaluation involves a more detailed review of community programs and initiatives to ascertain whether objectives are being achieved and if there are any unintended or undesired consequences. The outcomes of monitoring and evaluation activities provide the basis for reviewing and updating plans and taking corrective action where required.

3. SCOPE

This standard is applicable to Newmont owned and managed operations and properties at all phases of the mine life cycle, including exploration, design, construction, operation and closure. This standard encompasses guidance related to monitoring and evaluation activities undertaken by either internal groups or external third parties.

4. STANDARD

4.1 For all community-relations action plans and related programs (see Integrated Community Relations Strategic Planning standard), a monitoring and evaluation program that comprises the following shall be developed and implemented.

4.1.1 A clear set of goals and objectives, program outputs and desired outcomes

and agreed measures of success which are identified in the specified community relations strategic plan.

4.1.2 A comprehensive register of all legal obligations and agreements.

4.1.3 The method by which information will be collected to determine the level of

success achieved, as well as any feedback or concerns received.


STANDARD





4.1.4 A process, through formal and informal means, to ascertain the impacts experienced by key stakeholders and compare these to the impact management plan.

4.1.5 A database to capture the data collected, to ensure proper format and

storage and backup of information and the facilitation of analysis and evaluation.

4.1.6 A reporting procedure to ensure information is presented accurately and in a

readily understandable manner for timely review by program personnel, management, or external stakeholders.

4.2 Mechanisms to allow for community participation in monitoring and evaluation of

environmental, socio-economic and cultural aspects of site activity shall be identified and developed. Such mechanisms shall incorporate procedures for reporting of program outcomes to local stakeholders at least annually.

4.3 Monitoring schedules shall be established and documented dependent on the level of

risk, legal obligations and community expectations and periodic reviews of key agreements with stakeholders shall be conducted. These schedules shall be periodically reviewed, but no less than annually, and adjusted as necessary to ensure the effective capture of necessary data.

4.4 Monitoring reports shall be reviewed at the site and regional level on a quarterly basis

and held according to document controls standards.

4.5 Any gaps or underperformance noted in the review of monitoring reports will form the basis for corrective actions or modifications to the action plans or programs. Corrective actions must be documented in the site’s Corrective Action System.

5. KEY WORDS IN GLOSSARY Local community Stakeholder Impact Risk Human rights 6. APPENDICES Nil


STANDARD





7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Community Development Toolkit. ESMAP, World Bank, and ICMM, 2005 8. REFERENCES Nil 9. DOCUMENT CONTROL




STANDARD

Local Community Investment




1. PURPOSE

Ensure that each Newmont site has a strategic program for providing financial and in-kind assistance that helps to foster sustainble development in local communities while ensuring compliance with Newmont’s anti-corruption guidance.

2. SCOPE


3. RATIONALE

Newmont's objective is to provide increased returns to our shareholders while sharing the value created from our operations with a wider set of stakeholders through the alignment and linkage of our business obligations and our social responsibilities. A participatory and systematic approach to local community investment provides Newmont with opportunities to collaborate with local communities in a manner which ensures that investment programs effectively address local development challenges, contribute to sustainable outcomes and are executed in a cost-effective manner.

4. STANDARD

4.1 Needs Assessment

4.1.1 Each site will facilitate in collaboration with local stakeholders a needs assessment that identifies opportunities for local community investment.

4.1.2 The needs assessment will be informed by a thorough understanding of the

community, its development aspirations, customs, norms, and socio-economic profile (see Stakeholder Mapping, Social Baseline Studies, and Social Impact Assessment standards).

4.1.3 The assessment will seek to include the participation of representatives of

impacted stakeholder groups, in particular seeking out the participation of vulnerable or marginalized groups.

4.1.4 The assessment will seek to determine the level of competencies available within

the local community to directly implement and benefit from community investment programs.


STANDARD





4.1.5 The assessment process shall also include an analysis of the governance and development institutions operating in or near the local community that may provide support to the design, implementation, and/or monitoring/evaluation of the community investment programs.

4.2 Planning

4.2.1 A community investment plan shall be developed and maintained that addresses

the priorities identified during the needs assessment process (also see Integrated Community Relations Strategic Planning standard). The community investment plan shall indicate:

The need to be met/objective of each community investment program Description of the program and its key activities Resources that will be dedicated to meeting each program objectives

(financial and human) Timeline for program execution Evaluation metrics Monitoring and reporting requirements throughout the program life Roles and responsibilities for program oversight, implementation,

monitoring, and evaluation.

4.2.2 The action plan will be developed with the participation of the beneficiary stakeholder groups and program partners.

4.3 Charitable Donations and Other Contributions

4.3.1 All requests for contributions must be made in writing. The request must specify at a minimum (i) the person or organization requesting the contribution, (ii) a description of the contribution request, (iii) the purpose of the contribution, and (iv) the amount of the requested contribution.

If the request comes from a government agency, the request must be on official letterhead of the agency.

If the request comes from an entity other than a government agency, it should be on the requesting organization’s letterhead whenever possible. However, this may not be practical in some of the local areas where Newmont operates. In such cases, Newmont can assist the requestor to fill out a written contribution request using the form at Annex II.

No contribution may be approved unless there is a written record of the request.

4.3.2 All charitable contributions must be carefully reviewed to assess whether the

contribution will, or is substantially likely to, confer a personal benefit on a government official.


STANDARD





4.3.3 Except in extraordinary circumstances, decisions on charitable donations must be made by a committee of no fewer than three Newmont employees. In extraordinary circumstances where it is impractical for the committee to meet, the Relevant Executive may award a contribution, subject to review and ratification at the committee’s next meeting.

4.3.4 The committee should provide a written response to every person or organization

that submits a written contribution request advising of the committee's decision and the reason for that decision.

4.3.5 Newmont must obtain evidence of receipt for each contribution.

4.3.6 Charitable donations should be publicized in a manner that is most appropriate in

the local area. This could include periodic announcements in a local newspaper, posting contributions on local information kiosks, announcing contributions at local community gatherings, and/or listing contributions on the internet. Persons who request contributions should be told that contributions will be publicized in this manner.

4.3.7 All of the written records connected with charitable contributions – including the

written requests, letters of acceptance or rejection, evidence of receipt, and any publicity – must be retained for a period of five years from the date a contribution is made or the date of the decision not to make the contribution.

4.3.8 Under no circumstances may Newmont make a charitable contribution in cash to

a government official, or to a government official’s personal bank account.

4.3.9 Contributions may never be made as part of an exchange of favors with any government official, even if the recipient is a bona fide charity. If a government official has promised any benefit, or issued any threat, in connection with a contribution request, the contribution must be denied.

5. KEY WORDS IN GLOSSARY Local community Stakeholder Community investment In-kind assistance Needs assessment Competency Donation 6. APPENDICES Nil


STANDARD





7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Community Development Toolkit. ESMAP, World Bank, and ICMM, 2005 8. REFERENCES Newmont International Anti-Corruption Compliance Manual, June 2006 9. DOCUMENT CONTROL




STANDARD

Security and Human Rights




1. PURPOSE

To set the minimum requirements for Newmont in providing safety and security for Newmont employees and assets in a manner that respects human rights and is consistent with Newmont’s commitment to the Voluntary Principles on Security and Human Rights.

2. RATIONALE

The safety and security of Newmont’s employees and assets is critical to the success of our business. Newmont operates in challenging local contexts in which the responsibility for maintaining the integrity of its operations and personnel may bring it into direct confrontation with local community members. Ensuring that the conduct of public and private security forces acting on behalf of the company is consistent with the Voluntary Principles on Security and Human Rights decreases the likelihood of human rights incidents that may jeopardize the well-being of the local community as well as the global reputation of Newmont.

3. SCOPE


4. STANDARD

4.1 Risk Assessment 4.1.1 Assessments shall be undertaken that incorporate:

Identification of security risks Assessment of the potential for violence Identification and analysis of available human rights records of public

security forces, paramilitaries, local and national la enforcement, as well as the reputation of private security

Rule of law Analysis of existing and potential conflict Risks associated with equipment transfers

4.2. Interactions with Public Security Forces

4.2.1. Newmont shall consult regularly with host governments and local communities about the impact of its security arrangements on those communities.


STANDARD





4.2.2. Newmont shall communicate its policies regarding ethical conduct and human

rights to public security providers, and express its desire that security be provided in a manner consistent with those policies by personnel with adequate and effective training.

4.2.3. Newmont shall encourage host governments to permit making security

arrangements transparent and accessible to the public, subject to any overriding safety and security concerns.

4.2.4. The type and number of public security forces deployed shall be competent,

appropriate and proportional to the threat.

4.2.5. Equipment imports and exports shall comply with all applicable law and regulations. Sites that provide equipment to public security shall take all appropriate and lawful measures to mitigate any foreseeable negative consequences, including human rights abuses and violations of international humanitarian law.

4.2.6. Newmont shall use its influence to promote the following principles with public

security: (a) individuals credibly implicated in human rights abuses shall not provide security services for Newmont; (b) force shall be used only when strictly necessary and to an extent proportional to the threat; and (c) the rights of individuals shall not be violated while exercising the right to exercise freedom of association and peaceful assembly, the right to engage in collective bargaining, or other related rights of Newmont employees as recognized by the Universal Declaration of Human Rights and the ILO Declaration on Fundamental Principles and Rights at Work.

4.2.7. In cases where physical force is used by public security, such incidents shall be

reported to the appropriate authorities and site management. Where force is used, medical aid shall be provided to injured persons.

4.2.8. Newmont shall hold structured meetings with public security on a regular basis to

discuss security, human rights and related work-place safety issues.

4.2.9. Newmont shall also consult regularly with other Companies, host and home governments, and civil society to discuss security and human rights.

4.2.10. In its consultations with host governments, Newmont shall take all appropriate

measures to promote observance of applicable international law enforcement principles, particularly those reflected in the UN Code of Conduct for Law Enforcement Officials and the UN Basic Principles on the Use of Force and Firearms.


STANDARD





4.2.11. Newmont shall support efforts by governments, civil society and multilateral institutions to provide human rights training and education for public security.

4.2.12. Newmont shall record and report any credible allegations of human rights abuses

by public security in its areas of operation to appropriate host government authorities. Where appropriate, Newmont shall urge investigation and that action be taken to prevent any recurrence.

4.2.13. Newmont shall actively monitor the status of investigations and press for their

proper resolution.

4.2.14. Newmont shall, to the extent reasonable, monitor the use of equipment provided by the company and to investigate properly situations in which such equipment is used in an inappropriate manner.

4.2.15. Every effort shall be made to ensure that information used as the basis for

allegations of human rights abuses is credible and based on reliable evidence. The security and safety of sources shall be protected. Additional or more accurate information that may alter previous allegations shall be made available as appropriate to concerned parties.

4.3. Interactions with Private Security Forces

4.3.1. Private security shall observe Newmont policies regarding ethical conduct and human rights; the law and professional standards of the country in which they operate; emerging best practices developed by industry, civil society, and governments; and promote the observance of international humanitarian law.

4.3.2. Private security shall maintain high levels of technical and professional

proficiency, particularly with regard to the local use of force and firearms. 4.3.3. Private security shall act in a lawful manner. They shall exercise restraint and

caution in a manner consistent with applicable international guidelines regarding the local use of force, including the UN Principles on the Use of Force and Firearms by Law Enforcement Officials and the UN Code of Conduct for Law Enforcement Officials, as well as with emerging best practices developed by Companies, civil society, and governments.

4.3.4. Private security shall have policies regarding appropriate conduct and the local

use of force (e.g., rules of engagement). Practice under these policies shall be capable of being monitored by Newmont or, where appropriate, by independent third parties. Such monitoring shall encompass detailed investigations into allegations of abusive or unlawful acts; the availability of disciplinary measures sufficient to prevent and deter; and procedures for reporting allegations to relevant local law enforcement authorities when appropriate.


STANDARD





4.3.5. All allegations of human rights abuses by private security shall be recorded. Credible allegations shall be properly investigated. In those cases where allegations against private security providers are forwarded to the relevant law enforcement authorities, Newmont shall actively monitor the status of investigations and press for their proper resolution.

4.3.6. Consistent with their function, private security shall provide only preventative and

defensive services and shall not engage in activities exclusively the responsibility of state military or law enforcement authorities. Newmont shall designate services, technology and equipment capable of offensive and defensive purposes as being for defensive use only.

4.3.7. Private security shall (a) not employ individuals credibly implicated in human

rights abuses to provide security services; (b) use force only when strictly necessary and to an extent proportional to the threat; and (c) not violate the rights of individuals while exercising the right to exercise freedom of association and peaceful assembly, to engage in collective bargaining, or other related rights of Newmont employees as recognized by the Universal Declaration of Human Rights and the ILO Declaration on Fundamental Principles and Rights at Work.

4.3.8. In cases where physical force is used, private security shall properly investigate

and report the incident site management. Private security shall refer the matter to local authorities and/or take disciplinary action where appropriate. Where force is used, medical aid shall be provided to injured persons.

4.3.9. Private security shall maintain the confidentiality of information obtained as a

result of its position as security provider, except where to do so would jeopardize the principles contained herein.

4.3.10. Where appropriate, Newmont shall include the principles outlined above as

contractual provisions in agreements with private security providers and ensure that private security personnel are adequately trained to respect the rights of employees and the local community. To the extent practicable, agreements between Newmont and private security shall require investigation of unlawful or abusive behavior and appropriate disciplinary action. Agreements shall also permit termination of the relationship by Newmont where there is credible evidence of unlawful or abusive behavior by private security personnel.

4.3.11. Newmont shall consult and monitor private security providers to ensure they fulfil

their obligation to provide security in a manner consistent with the principles outlined above. Where appropriate, Newmont shall seek to employ private security providers that are representative of the local population.

4.3.12. Newmont shall review the background of private security they intend to employ,

particularly with regard to the use of excessive force. Such reviews shall include an assessment of previous services provided to the host government and


STANDARD





whether these services raise concern about the private security firm's dual role as a private security provider and government contractor.

4.3.13. Newmont shall consult with other companies, home country officials, host country

officials, and civil society regarding experiences with private security. Where appropriate and lawful, Newmont shall facilitate the exchange of information about unlawful activity and abuses committed by private security providers.

5. KEY WORDS IN GLOSSARY Local community Human rights Risk Risk assessment Incident Conflict 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 [toolkit forthcoming] 8. REFERENCES Voluntary Principles on Security and Human Rights UN Principles on the Use of Force and Firearms by Law Enforcement Officials UN Code of Conduct for Law Enforcement Officials Universal Declaration of Human Rights ILO Declaration on Fundamental Principles and Rights at Work 9. DOCUMENT CONTROL



STANDARD

Land Access, Acquisition and Resettlement




1. PURPOSE

To set the minimum requirements for accessing or acquiring land before any site-related activity commences, so that the rights and needs of local communities related to land access and acquisition are assessed and addressed prior to impact, and such interactions between the company and local community are done in a manner that fosters trust and mutual respect.

2. RATIONALE

Newmont’s success depends on access to economic resources and therefore access to land. The long-term well-being of local communities is often dependant on access to the same land, making land access and acquisition a key point of potential conflict between the company and local communities. Newmont must therefore engage with local communities regarding land in such a way as to minimize and mitigate potential negative impacts, provide for timely and effective compensation, and ensure that the health and well-being of local communities is maintained or improved during and after any transfer of resources. This will provide the best possible opportunity for minimizing land-related conflict between Newmont and local communities.

3. SCOPE


4. STANDARD

4.1 Identification of Affected Stakeholders

4.1.1 Prior to accessing or acquiring land, all stakeholders with a socio-economic and/or legal interest in the parcel will be identified, including but not limited to:

Legal title holders Customary title holders Lease holders Tenants Resource users

4.1.2 Points of existing or potential conflict related to the parcels in question shall be

assessed (see Stakeholder Mapping standard).


STANDARD





4.1.3 Such information shall be documented in a land registry, and shall be updated at

least monthly or as site development requires.

4.2 Compensation

4.2.1 Where land access or acquisition for site activity will result in a loss of assets, income, or livelihood of local community members, a comprehensive baseline data collection and impact assessment for affected persons and households will be undertaken (see Impact Assessment standard).

4.2.2 In such cases, Newmont shall:

Promptly compensate for loss of assets or access to assets at full replacement cost

In cases where land acquisition affects commercial structures, compensate the affected business owner for the cost of reestablishing commercial activities elsewhere, for lost net income during the period of transition, and for the costs of the transfer and reinstallation of the plant, machinery or other equipment

Compensate for lost assets such as crops, irrigation infrastructure and other improvements made to the land, at full replacement cost.

Provide additional targeted assistance and opportunities to improve or at least restore their income-earning capacity, production levels, and standards of living

Provide transitional support, as necessary, based on a reasonable estimate of the time required to restore their income earning capacity, production levels, and standards of living.

4.2.3 Compensation measures shall be determined through a transparent consultation

and negotiation process with affected persons that enshrines: Respect for legal and customary title and use of the land and related

assets Informed participation of affected persons Fair market value in compensation that represents at least replacement

cost for any assets removed or damaged Fair and equitable access to development opportunities related to site

activity A complete and accessible record of access permissions and acquisitions Condition of any land or related assets to be returned to the stakeholders

upon exit.

4.2.4 The negotiation process shall be developed with consideration for existing or potential conflict (see 4.1.2 above), to ensure that such conflict is mitigated or minimized.


STANDARD





4.2.5 Assistance will be offered to affected persons and local communities where

necessary to ensure their full and informed participation in negotiation processes. Negotiation will be directly with individuals or through appropriate representation of the affected persons and / or local communities.

4.2.6 Local laws and regulations shall be fully reviewed prior to determining

compensation processes and levels to ensure full compliance.

4.3 Resettlement

4.3.1 Where land access or acquisition will result in the physical displacement of local community members, the following shall be undertaken prior to resettlement activity: An analysis of all alternative options to avoid or minimize resettlement. A census of affected persons and households. Establishment of a cut-off date for eligibility and participation in

negotiations. Where host government procedures are absent, the cut-off date shall be established by the company, in consultation with local authorities.

A comprehensive baseline data collection and impact assessment for affected persons and households, including communities to host those being resettled (see Impact Assessment standard).

The development of a consultation and negotiation procedure in collaboration with affection persons, per section 4.2.3 above.

4.3.2 Physically displaced persons shall be offered choices among feasible

resettlement options, including replacement housing or cash compensation where appropriate, prior to relocation.

4.3.3 Relocation assistance shall be provided, suited to the needs of each group of

displaced persons, with particular attention paid to the needs of the poor and the vulnerable, to allow them to restore their standards of living at the alternative site. New resettlement sites built for displaced persons will offer improved living conditions.

4.3.4 A program shall be developed and implemented to address the needs of those

households who will experience transitional vulnerability due to physical or economic displacement.

4.3.5 Replacement property shall be of equal or higher value, equivalent or better

characteristics and advantages of location.

4.3.6 Security of tenure at the new location shall be provided through legal title.


STANDARD





4.3.7 Structures that are owned and occupied at the time of eligibility cut-off shall be

compensated for at full replacement cost. Where feasible, compensation will be offered in kind in lieu of cash.

4.3.8 A resettlement plan shall be developed that comprises:

Site activity and purpose of the plan Institutional and legal framework for the resettlement activity Summary of baseline data and analysis Identification of site impacts Consultation and negotiation mechanisms Compensation framework, including eligibility and entitlements Resettlement and relocation packages Livelihood re-establish programs Community development programs Measures to be taken to ensure the protection of marginalized or

vulnerable persons Measures to be taken to address the needs of those who will experience

transitional vulnerabilities during the resettlement process Measures to be taken to protect cultural heritage Framework of participating organizations, including negoatiating and

consultative committees, Newmont personnel, and government agencies, and their roles and responsibilities

Stakeholder Communication Plans Public Consultation and Disclosure Plans Grievance procedures Monitoring, evaluation and reporting procedures Schedule Budget

4.4 Complaints/Grievance Resolution

4.4.1 A complaints/grievance mechanism shall be developed to capture and address complaints or grievances related to land access and acquisition, in line with the Complaints/Grievances Management standard.

4.5 Monitoring

4.5.1 Land access and acquisition programs shall be monitored on a monthly basis, at

a minimum, by senior site management, to ensure that permissions and acquisition practices are in conformance with this standard and national legal frameworks.


STANDARD





4.5.2 Complaints and grievances shall be monitored according to the standard on

Complaints/Grievances Management and Resolution. 4.5.3 Resettlement plans will be monitored against stated objectives and procedures

on a monthly basis, and corrective actions taken where necessary to ensure their effective execution.

4.5.4 Resettlement plans will be audited annually by an external party to ensure that all

activities are undertaken in accordance with Newmont standards and are meeting the needs of affected persons.

5. KEY WORDS IN GLOSSARY Local community Stakeholder Impact Impact Assessment Conflict Marginalized persons Cultural heritage Complaint Grievance 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Handbook for Preparing a Resettlement Action Plan. IFC, 2002 8. REFERENCES Nil


STANDARD





9. DOCUMENT CONTROL



STANDARD

Management of Cultural and Heritage Sites




1. PURPOSE To set the minimum requirements for the identification, protection and management of sites with cultural or heritage significance to local stakeholders within the areas of influence of Newmont activity so as to prevent unauthorized disturbance by Newmont personnel. 2. RATIONALE Cultural and heritage sites are a key feature of the landscape for past, current and future generations. Cultural sensitivity is a cornerstone of good engagement; when absent, it can lead to deep and long-running mistrust and conflict between a company and local community. Engagement with the custodians of cultural and heritage sites (often Indigenous people with historical attachment to the land), through a collaborative and respectful approach to the identification, protection and management of cultural and heritage sites, can help to establish and maintain trust and provide a foundation upon which to build a constructive long-term relationship. 3. SCOPE This standard is applicable to Newmont owned and managed operations and properties at all phases of the mine life cycle, including exploration, design, construction, operation and closure. 4. STANDARD

4.1 A survey, which will include ethnographic, archaeological and anthropological aspects, shall be undertaken of property owned or leased by Newmont to identify sites of cultural or heritage significance, prior to access or disturbance.

4.2 The survey shall be developed in collaboration with local stakeholders/cultural heritage

custodians and guided by local cultural norms and traditional knowledge.

4.3 The survey shall be informed by data collected through baseline studies and impact assessments (see Social Baseline Studies and Social Impact Assessment standards).

4.4 A mechanism shall be developed to store survey findings, either with Newmont or a

local institution, to ensure the security of the data and respect for cultural protocols related to the confidentiality and use of the information.

4.5 For properties acquired by Newmont, a review against this standard will be conducted

to determine whether a survey is warranted, and if necessary, be completed within 12 months of acquisition.


STANDARD





4.6 Survey findings shall be used to develop a mutually agreed management plan for each

site identified, in collaboration with local stakeholders.

4.7 The management plan shall include: Mutually agreed access levels for each site identified, including exclusion,

access with minimally agreed disturbance, access with major disturbance, or relocation of any artifacts or cultural assets.

Identification of the relevant local or traditional leader or agency with authority for decisions regarding each site.

Mutually agreed measures for protection, access or disturbance for each site Where reclamation is an aspect of agreed disturbance, the reclamation plan

and agreed final state of remediation. Procedures for obtaining appropriate authorizations by Newmont personnel,

prior to access or disturbance. Procedures for safe access to protected sites by local stakeholders for regular

monitoring and/or ceremonial rights. Procedures for situations where there is a chance find of a previously

unidentified site. Definition of a cultural heritage incident and the measures to be taken in the

event of unauthorized disturbance, including incident reporting and investigation, emergency response, and penalties.

4.8 A record of all authorizations for access and disturbance shall be kept in accordance

with documentation storage procedures. 4.9 A record of all unauthorized disturbances, and corresponding investigations, shall be

kept in accordance with documentation storage procedures. 4.10 Complaints regarding alleged breaches to the agreed management plan shall be

addressed through the site’s complaint/grievance mechanism and in alignment with the agreed management plan measures (see 4.7 above).

4.11 Where job or task appropriate, Newmont personnel shall be informed of site locations

and agreed procedures established in the management plan. 4.12 The management plan shall be reviewed in collaboration with local stakeholders at

least annually. 4.13 The management plan shall be updated to account for new information collected

through updating of baseline information and impact assessments.


STANDARD





5. KEY WORDS IN GLOSSARY Stakeholder Impact Assessment Baseline information Conflict Site of cultural or heritage significance Complaint Grievance 6. APPENDICES Nil 7. SUPPORTING DOCUMENTS Newmont Social Development Framework, January 2010 Akwé: Kon Guidelines. Secretariat of the Convention on Biological Diversity, 2004 8. REFERENCES Nil 9. DOCUMENT CONTROL



STANDARD

Glossary




Term Definition

Area of influence Defined as: the primary project site(s) and related facilities, such as power

transmission corridors, pipelines, canals, tunnels, relocation and access roads, borrow and disposal areas, and camps;

associated facilities whose viability and existence depend exclusively on the project and whose goods or services are essential for the successful operation of the project;

local, regional and national communities and systems that may be directly or indirectly impacted; and

areas potentially impacted by cumulative impacts from further planned development of the project or region.

Baseline information Data that describes the state of the social and economic context and the characteristics of the populations living in the area around a mining project.

Closure The process followed when an asset or site has reached the stage in its life cycle when the intended use has been permanently terminated. Includes broader issues than decommissioning such as community consultation and employee severance, and is described in a Closure Plan.

Closure criteria An agreed standard or level of performance which demonstrates successful closure of a site. Specific milestones that indicate progress towards achievement of mine closure objectives, as agreed with stakeholders.

Community investment

Monetary or in-kind contributions made by the company for the purpose of enhancing the well-being of the local community. Also referred to as “social investment.”

Competency A combination of attributes such as knowledge, skills, experience, abilities and attitudes underlying some aspect of successful professional performance.

Complaint An expression of discontent, damage, discomfort, annoyance etc. of an individual or group of people, directly or indirectly caused by Newmont activities.


STANDARD

Glossary




Term Definition

Conflict When two or more parties perceive their interests are incompatible, express hostile attitudes, or pursue their interests through actions that damage the other parties. These parties may be individuals, small or large groups, or countries.

Contractor A natural person, business, or corporation that provides goods or services to Newmont under terms specified in a contract. Unlike an employee, an independent contractor does not work regularly for a single employer but works as and when required. Generally speaking, contractors retain control over their schedule and number of hours worked, and jobs accepted.

Culturally Significant or Religious Site

Any site or cultural resources (artifacts, flora and fauna) which are important to a community because it is part of that community's cultural or religious identity and practices.

Customary title Recognition of traditional and/or hereditary use and decision-making authority over a piece of land, feature of the landscape or object.

Donation A solicited item/resource with a monetary value that the company can deduct on its corporate tax return as a charitable gift. Donations can be cash or in-kind.

Employee Person who works for Newmont under a contract of employment, including apprenticeship or traineeship. In direct employment situations, Newmont retains control over the employee’s schedule, number of hours worked, duties to be performed, and definition of performance criteria.

Grievance Similar to complaint, with the difference that the complainant requests monetary or non-monetary compensation and demands formal redress.

Heritage site A physical site or location with historical or potential historical, religious or cultural value to the community and/or registered relevant authorities.

Human rights Fundamental principles allowing individuals freedom to lead a dignified life, freedom from abuse and violations and freedom to express independent beliefs.


STANDARD

Glossary




Term Definition

Impact Any negative or positive effect on the community, resulting from project activities, products or services.

Incident When there is an event or occurrence (it may be in the form of an external complaint) that indicates that a standard operating procedure, policy, etc has been breached. Act or complaint that negatively impacts Newmont’s ability to carry out operating activities or impacts Newmont’s reputation.

In-kind assistance Manufactured product donations, permanent or temporary contributions of mining equipment and materials, services and other non-cash goods provided by companies to charities. “Non-cash” includes physical assets e.g., computers, property, equipment and other material donations deducted on corporate tax returns as charitable gifts. “Non-cash” can also include discounts, volunteer programs and service donations.

Local community A community that is immediately impacted by Newmont activity. See also “Area of influence.”

Marginalized person or group

An individual or group that exists on the fringes of a local community, and who may experience greater difficulty in accessing key channels of communication, participation, and social assistance. Also known as “vulnerable” persons or groups.

Needs assessment A systematic process for the collection and analysis of community investment opportunities. This analysis allows Newmont to make informed policy and resource allocation decisions. The techniques used to conduct the community needs analysis can include: review of statistics about the community, review of analytical studies regarding the communities targeted, participant observation, case study, survey and stakeholder engagement and consensus.

Personnel Inclusive of both employees and contractors.

Protocol Particular ceremonies and etiquette practices that are followed by people of a particular group.


STANDARD

Glossary




Term Definition

Risk The chance of something happening that will have an impact upon the community. It is measured in terms of consequences and likelihood.

Risk assessment The process used to determine risk management priorities by evaluating and comparing the level of risk against predetermined standards, target risk levels or other criteria.

Site For the purposes of the Social Responsibility standards, “site” indicates Newmont activity at a defined local level. This may include Newmont activity anywhere along the continuum of the mine life cycle, from exploration through closure, and is used as a more inclusive term than “project,” “operation,” or “facility.”

Social impact assessment

A process for assessing the issues and impacts on local communities arising from Newmont project activity for the whole life cycle of that activity.

Stakeholder Those individuals and groups that can affect or be affected by Newmont activities. See Community Development Toolkit, ICMM, ESMAP, World Bank, 2005; Assessment Tool #1.

DOCUMENT CONTROL


Appendix B

PROCEDURE TO EMPLOY WOMENPROCEDURE TO EMPLOY WOMENWORKERSWORKERS

MINISTER OF MANPOWER AND TRANSMIGRATION REPUBLIC OF INDONESIA

DECISION

OF THE MINISTER OF MANPOWER AND TRANSMIGRATION OF THE REPUBLIC OF INDONESIA

NUMBER: KEP. 224/MEN/2003

ON

PROVISION FOR ENTREPRENEURS WHO EMPLOY FEMALE WORKERS/LABORERS TO WORK

BETWEEN 11.00 P.M. UNTIL 07.00 A.M.

THE MINISTER OF MANPOWER AND TRANSMIGRATION OF THE REPUBLIC OF INDONESIA

Considering:

a. That for the implementation of Article 76 paragraphs (3) and (4) of Law Number 13 Year 2003 on Manpower, it is necessary to stipulate employers’ obligations when hiring female workers/laborers between 11.00 pm and 07.00 am;

b. That therefore it is deemed necessary to be stipulated based on the Decree of the Minister.;

In view of:

1. Law Number 3 Year 1951 regarding the Validation of the Labor Supervision Act No. 23/1948 of the Republic of Indonesia Throughout the Whole Territory of Indonesia (the Republic of Indonesia State Gazette Number 4 Year 1951);

2. Law Number 13 Year 2003 on Manpower (the Republic of Indonesia State Gazette Number 39 Year 2003; Supplement Number 4279 to the Republic of Indonesia State Gazette);

3. Presidential Decree Number 228/M Year 2001 on the Establishment of the Gotong Royong Cabinet.

Observing:

1. Reasoning of the Secretariat of the National Tripartite Cooperation Institution dated 31st August 2003;

2. Plenary Meeting Agreement on the National Tripartite Cooperation Institution dated 9th September 2003.

RESOLVES

To stipulate:

THE DECISION OF THE MINISTER OF MANPOWER AND TRANSMIGRATION OF THE REPUBLIC OF INDONESIA ON EMPLOYER’S OBLIGATIONS WHEN HIRING FEMALE WORKERS/LABORERS BETWEEN 11.00 PM AND 07.00 AM.

Article 1 In this Decree of the Minister, the meaning of: 1. Employer is:

a. An individual, association, or legal body that operates a business of its own;

b. An individual, association, or legal body that independently operates a business not of its own;

c. An individual, association, or legal body domiciling in the Republic of Indonesia representing a business as meant in letters a and b domiciling outside the Indonesian territory.

2. Worker/laborer is someone who works in return for monetary or other types of rewards;

3. Company is: a. Any form of enterprise, be it a legal body or not, owned by an

individual, association, or legal body, both privately- and state-owned, employing workers/laborers by providing monetary or other types of rewards;

b. Social and other businesses having a management body and employing other persons by giving monetary or other types of rewards.

4. The Minister is the Minister of Manpower and Transmigration.

Article 2 (1) Employer hiring female workers/labors between 11.00 pm and 07.00 am is

obliged: a. to provide nutritious food and beverages; b. to maintain ethics and security in the workplace.

(2) Employer is obliged to provide transportation facilities to female

workers/labors who go to and go back from work between 11.00 pm and 05.00 am.

Article 3

(1) The nutritious food and beverages as meant in Article 2 paragraph (1) letter a

must at least contain 1,400 calories and be provided during the rest hour between the working hours;

(2) The food and beverages shall not be compensated by money.

Article 4 (1) The food and beverages, equipment and dining room must be appropriate

and meet the hygiene and sanitary requirements; (2) The menu on the food and beverages served to workers/labors must be

varied.

Article 5 The security and ethics as meant in Article 2 paragraph (1) letter b are: a. Providing security officers at the work place; b. Providing separate bathroom/toilet for female and male workers/laborers with

appropriate lighting.

Article 6 (1) Employer is obliged to provide home-to-work and work-to-home transportation

facilities. (2) The pick-up for the home-to-work and work-to-home shall be at determined

points between 11.00 pm and 05.00 am.

Article 7 (1) Employer must stipulate pick-up points for home-to-work and work-to-home

transportation facilities that are easy to reach and safe for the female workers/laborers.

(2) The pick-up transportation facilities must be in appropriate condition and registered at the company.

Article 8

The provision of food and beverages, ethics, security in the workplace, as well as home-to-work and work-to-home transportation facilities as meant in Article 2 shall be further regulated in the Work Agreement, Company Regulation or Joint Working Agreement.

Article 9 This Decree of the Minister shall come into force on the stipulation date.

Stipulated in: Jakarta On: 31st October 2003 Minister of Manpower and Transmigration of the Republic of Indonesia (Signed and sealed) JACOB NUWA WEA

Appendix C

STAKEHOLDER MEETING SUMMARYSTAKEHOLDER MEETING SUMMARY

SIA Report

Data Validation Sumbawa, December 06 – 12, 2009

SUMMARY The activity was part of overall Social Impact Assessment (SIA) done by Amec. The workhsops/FGDs to verify data and to gauge information on the impacts were divided into four clusters and were held in four locations as detailed below:

1. The discussion of cluster 1 was held in community center, Tongo Village. Cluster 1 consists of four villages under Sekongkang Subdistrict administration:

a. SP 1/Ai Kangkung; b. SP 2/Tatar; c. SP 3/Talonang; and d. Tongo

2. The discussion of cluster 2 was held in Sekongkang Subdistrict’s office in Sekongkang

Bawah Village. Cluster 2 consists of two villages under Sekongkang Subdistrict administration:

a. Sekongkang Bawah; and b. Sekongkang Atas.

3. The discussion of custer 3 was held in community center, Maluk Village. Cluster 3

consists of four villages under Maluk Subdistrict administration: a. Benete b. Bukit Damai c. Maluk (Mantun and Maluk Loka); and d. Pasir Putih.

4. The discussion of cluster 4 was held in community center, Goa Village. Cluster 4 consists

of villages under of Jereweh Subdistrict administration: a. Belo; b. Beru; c. Dasan Anyar; and d. Goa.

Discussion agenda was explained at the beginning of the meeting, as follows: Introduction, Briefing SIA, Data Verification, and Discussion on: Condition before and after the mining; Impacts, and Expectation Participation rate in each location was high, it is about 70% to 90%, but women participation was low, between 7 to 20% only. RESULT Overall discussions went well, each has its own dynamism. In general, people verified the data presented, only some minor mistakes, for example on the name of the villages, total households/residents, percentage number of people’s income, people’s way for medical care: modern vs traditional, home ownership, sanitary facilities, etc., whereby they provided the correction. They also verified PT NNT investment data for the community, but disagreed if any infrastructure was part of PT NNT facilities. Community acknowIedged PT NNT investment in

Page 2

the area and appreciate the positive impacts and at the same time expressed their concerns in the negative impacts. The presence of PT NNT had changed their life to some extent, better infrastructure, improved basic human services, i.e., in education, health, water and sanitation, and better standard of living, and so forth. However, negative impacts are inevitable, such as shifting of values from social solidarity to individualistic, materialistic way of life, occurrence of social diseases, limited space to move around, decreased water quality, scarcity of water springs, etc. And finally, community feel that there are challenges that must be anticipated before the mining closure, such as the people’s capacity in maintaining NNT investment and its sustainability with limited or without funds. In all four locations, most participants criticized the meeting such as this, because, according to them, any meeting related with NNT usually did not have any follows up, nor that their aspirations were heard. This report consists of:

• This summary of activities carried out; • The assessment report of each location; • Attendence lists of each Location; • Photo Gallery

Each report has slightly different emphasis and has different format. This is because of the ‘agreement’ made in each meeting. In one meeting, for example, some participants insisted that data need not verification, thus, should continue with listening to their feedback on community aspirations or else, the meeting be stopped. In other meeting, active participants wanted the meeting to discuss community development’s strategic planning for 2010 first. So, the report may not have all the impacts that are expected.

Page 3

Location : Tongo Village, Sekongkang Subdisrict

Date : 8 December 2009 FOCUS GROUP DISCUSSION SOCIAL IMPACT ASSESSMENT

Team : Restu Pratiwi & Mukhtar

Agenda:

1. Introduction 2. Briefing SIA 3. Data Verification 4. Discussion:

a. Condition before and after the mining; b. Impacts c. Expectation

SUMMARY

FGD was held at the community Center in Tongo. There were 28 participants, two of them are female, participated in the discussion, representing four villages: Tongo, SP 1/Ai Kangkung, SP 2, and SP 3/Tatar. In general, they agreed with the data presented, and needed some correction, such as the number of population in 1994 and 2008 and name of Talonang Baru Village, instead of Telonang. Below is the important points resulted from the discussion:

1. Representatives from Ai Kangkung confirmed that initially there were about 200 households

with details as follows: a. 50 households from Bali b. 60 households from East Lombok & West Lombok c. 50 households from Central Lombok d. 40 households APDT (indigenous people);

2. There are quite significant difference in population data from Amec and information from Ai Kangkung village administration authority and record;

3. Representatives from Tatar Village believed that there is higher percentage of people who still seek shaman/traditional healer for medical care, particularly women who deliver their babies, than what was presented;

4. Participants all agreed that investment by PT NNT has brought positive impacts to community. Nevertheless, people expect that perfection should be made in order for the investment to benefit all. On the other hands, negative impacts seem to be weighed more than the positive ones.

Page 4

DATA VERIFICATION

Location/Village Input SIA Reports

SP 1 – Ai Kangkung

a. Initially a group of fishermen from Lombok and Bali. Total population wais 190 households

e. 50 households from Bali f. 50 households from East

Lombok Timur & West Lombok

g. 50 households from Central Lombok

h. 40 households APDT (indigenous people)

b. In 2008 total population is 287

households or 1,014 residents;

c. 50% of the population still goes to the traditional healer for medical care (particularly for women for delivering their babies, only when there is complication they go to midwife/village nurse).

a. Data in 1995; 50 of the families were Hindus from Bali

b. In 2008: 251 households with a total population of 912 residents;

c. Almost 6 percent goes to traditional healer/shaman

SP II - Tatar

a. 74% of the houses are semi permanent

b. 20% of the residents have private sanitary facilities; the rest uses public or shared facilities;

c. Approximately 50% of the people go to shaman for medical care, and 50% others go to health center;

d. Livelihood: in addition to collectiong forest product, some of the are farming and rasising stock

a. 78% of the houses are semi permanent

b. 41% of the residents have private sanitary facilities

c. 93% go to health center for medical care;

d. Did not report

SP III - Talonang

Only reiterated and provided example on community livelihood, such as collecting honey, hunting, and collecting rattan.

Tongo

a. Almost 72% of the households earn under 500,000 rupiah per month, not under 1,500,000 rupiah;

b. Need further clarification on the percentage of those who earn 3,500,000 rupiah per month;

Page 5

IMPACTS

Village Before After


a. Agriculture : In 1995: for irrigation still depended on the rain;

b. Education; • Lack of facilities, qualitiy was

also poor. The community even used a warehouse to accomodate students;

• High rate of drops out

c. Health: o High prevalence rate of Malaria

a. Agriculture: irrigation is semi intensive with twice a year of planting season;

b. Education:

• School buildings are better in quality, the number is also increased;

• Drops out rate has own to below 2%;

c. Health: • Prevalence rate of Malaria

has dropped drastically because of the bednets provided by NNT

SP II - Tatar No community development were visible program between 1994 – 2005

School building, road improvement, irrigation, etc.

SP III - Talonang So far there have not been any community development activity or program, only village health clinic.

Tongo

a. People were free to go farming wherever they saw free land; It was easier also for the fishermen to get fish in beach nearby.

b. Infrastructure, such as road, school, health center, irrigation etc. were non existence or in poor condition;

c. No street lighting facilities;

d. Water in the river was abundant.

a. The presence of transmigrants (SP 1 and SP 2) and PT NNT had limited their opportunities in expanding their livelihood. The land got narrower; people have to go farther in the sea to get fish;

b. Good infrastructure was

developed and c. Street lighting was installed; d. River has started to dry up.

Page 6

Feedack:

Village Expectation Notes


a. Sanitary facilities in each household; b. Construction of water facility; c. Optimization use of windmill; d. More recruitment from the local people and the

number should be in proportion with the population size;

e. Home Improvement Program like in Tongo

SP II – Tatar

a. More recruitment for the local residents; b. Home Improvement Program like in Tongo

(‘Bedah rumah’); c. Road Improvement with road lighting, school

construction; d. Home Improvement Program like in Tongo

SP III – Talonang Equal treatment with those neighboring villages

Tongo

a. A separation/barrier should be built between public and NNT roads for the roads that are used by both for safety reason;

b. At least the road is watered 3 times a day; c. Presence of doctors in health center; d. Development of High School so the local

children do not need to go far for further education;

e. Farmers should be given assistance; f. Water facility that comes from the

source/spring should be built; g. More recruitment for local people so the living

standard is improved.

f. Electricity for water pump is too burdensome for the people.

Additional Notes:

1. Historically, the settlement was hard to reach because of its remoteness and the mountain next to the village, therefore people moved to Tongo. Initially, Tongo, SP 1 and SP 2 belonged to Sekongkang Atas Village, and now each of them has become independent village.

2. Social Gap:

• Indigenous people feel that they are the true ‘victim of the mining;’ • While the transmigrants of SP 1 and SP 2 were allocated housing and land by the

government, the indigenous people did not receive any; • Further, there are more migrants who work for NNT than the indigenous people;

3. After the Mining:

• People questioned the maintenance of those facilities built by NNT; • Measures to anticipate negative impacts after NNT leaves; • Now that lands were already acquistioned by NNT, sea water has been contaminated,

people are pessimistic about their future.

Page 7

PARTICIPANTS FOR FOCUS GROUP DISCUSSION

SOCIAL IMPACT ANALYSIS

Tongo, 8 December 2009

NO NAME ORGANIZATION/REPRESENTATIVE ADDRESS

1 Agus Tono Village Rep Tongo

2 Syaharuddin Village Rep Tongo

3 Hasan Village Chief 04 Tongo

4 Sahabuddin Community member RT 07 Sejorong

5 Erwan S Community member RT 02 Ai Kangkung

6 Marzuki Community member RT 06 Sejorong

7 Rifayanti Village Staff Tongo Sejorong

8 Made Suparta Village Staff Tongo Ai Kangkung

9 Mauluddin Village Staff Ai Kangkung

10 Lukman Community member Tongo

11 M. Daud Village Rep. Secretary Ai Kangkung

12 L. Abdul Gafar Village Staff Ai Kangkung

13 L. Syafi'i Village Rep. member Talonang Baru

14 Hamdan Village Staff Talonang Baru

15 Mustiadi Village Rep. member Ai Kangkung

16 Akhyar Rosidi Village Rep. member Talonang Baru

17 Hasbullah Community Leader Tatar

18 Musta'in Village Rep. member Tatar

19 Syaifullah Village Staff Ai Kangkung

20 Mustamin K. Village Chief Talonang Baru

21 Akhmad Secretary of Village Office Ai Kangkung

22 Supardi Chief of Village Rep. Council Sejorong

23 Muslimin Village Rep. member Talonang Baru

24 Husen Bafadal Village Property Management Talonang Baru

25 Khaerul Hendrawansyah Deputy Chief of Village Rep. Council Talonang Baru

26 Kadri Village Rep. member Tongo

27 Mutma'innah Village Staff Sejorong

28 Zulkarnaen Youth Leader Sejorong

Page 8

Location : Sekongkang Bawah Date : 9 December 2009 FOCUS GROUP DISCUSSION

SOCIAL IMPACT ASSESSMENT Team : Restu Pratiwi & Mukhtar

AGENDA:

1. Introduction 2. Briefing on SIA 3. Data Verification 4. Discussion:


SUMMARY

FGD was held in subdistrict’s office of Sekongkang. There were 18 participants, with four female participated in the discussion, consisted of Villages’ representatives from Sekongkang Atas and Sekongkang Bawah, community leaders, and local government officials. Initially the FGD process was tense, some participants refused to go through the SIA data and verify them, one participant (Mr. Saleh) also dominated the forum, provoking others and argued that the many meeting held in the past did not result in any follow ups, therefore he insisted on discussing the community needs.

Below is the important points resulted from the discussion:

1. Participants verified the SIA data presented about their villages and investment by PT. NNT. There was one minor mistake in the population data and hence, needs correction. It was reported that the number of population was 470 households with total of 1,799 resident in Sekongkang Atas, and 286 households with total of 1,135 residents in Sekongkang Bawah. While the data from the office of statistic bureau reported that there were 518 households, with total of 2,373 residents in Sekongkang Atas and 230 households with total of 901 residents in Sekongkang Bawah;

2. All participants agreed that there are many positive impacts brought by PT NNT to the community in Sekongkang, such as development of many infrastructures of roads, irrigation, water system or in education and health.

3. However, negative impacts can also be found. For example, in the past, people moved around freely to any place they wanted to go but now community are restricted, particularly to enter the mining complex/town site.

4. On another note, community was disappointed because, according to them, none of their recommendations on community program submitted in the meetings were not followed up.

Page 9

DATA VERIFICATION :

Village Input Notes

Sekongkang Atas 2008: 518 households with total of 2,373 residents

Source: Bureau of Statistics at Subdistrict Office

Sekongkang Bawah 2008: 230 households with total of 901 residents

Source: Bureau of Statistics at Subdistrict Office

IMPACTS

Village Before the Mining After the mining

Limited infrastructure, i.e., roads, , school building, health facilities, agriculture, etc.

Better infrastructure, hence, improved quality of living.

• Many school age children did not receive formal education because of financial capacity and limited school facilities;

• High rate of drops out.

• None of school age child do not go to school;

• No drops out.

• Majority of people went to traditional healer/shaman for medical care, because health center was no existence;

• High prevalence in Malaria and

TB

• People now have much better access for medical care, only small percentage of people still go to traditional healer/shaman;

• Community is better educated, as health facilities built by PT NNT has helped to reduce drastically the prevalence rate of Malaria, TB, or maternal and infant mortality rates, because they are better nutritioned.

Sekongkang Atas & Sekongkang Bawah

• Water springs were easy to find • Difficult to find and even when they can find one, the quality of water is bad.

Page 10

Recommendation: Participants provided several recommendations in the following areas:

Sector Program Recommendation

Health

• The water systems that were built by PT NNT should be further developed and optimized its use so that community can benefit from it. A gravitation system, for example, might work better in distributing the water down to the community;

• The health center should be equipped with additional in-patient facility;

• The number of toilet provided by PT NNT in local schools is not sufficient, given the number of students;

• There should be a follow up after PT NNT took blood sample from students, for example, free treatment for those who were detected a disease;

• Speed up the administrative process should there be any patient needs financial support for further treatment.

Education

• Assistance provided by PT NNT in education sector should be accompanied with supporting facilities, such as school’s equipment or books, from kindergaarten to high school;

• Refresher Training for teachers to increase capacity, hence quality of education is improved;

• Computers with internet access to catch up with current technology;

• Subsidies to increase teachers’ income, considering some of them still live on honoraria, while the living standard in mining area is expensive;

• Subsidies to all students from poor families without considering their achievement;

• There is discrimination in scholarship program between those who live in mining circle and outside;

• Extra curriculer activities for students to improve quality of education, particularly in English and Math.

Page 11

Sector Program Recommendation

Agriculture/Economy

• Community hopes that they are given access to do business inside the mining compound;

• Community hopes that PT NNT provide capacity building, particularly for farmers until they have enough capacity to improve their farming techniques, hence, increase their production and in turn, can supply needs of PT NNT through PBU;

• The water systems that were built by PT NNT should be further developed and optimized its use so that community can benefit from it. A gravitation system, for example, might work better in distributing water from the water tank down to the community.

• Assistance to farmers through development of horticulture technology to allow advancement to increase agricultural production for export to prepare people’s livelihood after the mining;

• Repair the irrigation channels (primary and secondary) in Plampo.

Page 12



Sekongkang, 9 December 2009


1 Muhajirin Village Rep. Council Sekongkang Atas

2 M. Saleh Ishaq Secretary of Village Office Sekongkang Atas

3 Nurhayati Village staff Sekongkang Bawah

4 Rositawati Village staff Sekongkang Bawah

5 Abdul Wahid Village Rep. Council Sekongkang Atas

6 Sulhaery Village staff Sekongkang Atas

7 Rosihan Anwar Sekongkang Atas

8 M. Ali Sekongkang Bawah

9 Nurul Suhada Subdistrict Office staff Sekongkang Atas

10 Nurul Syaspri A. Subdistrict Office staff Sekongkang Atas

11 Syarafuddin Sekongkang Atas

12 Ali Imran Sekongkang Bawah

13 Sirajuddin Subdistrict Office Secretary Sekongkang Bawah

14 Panca Hermanto Village Rep. Council Sekongkang Atas

15 H. Hasbullah Secretary of Village Office Sekongkang Bawah

16 Beri hamdan Subdistrict Office staff Sekongkang Bawah

17 Heri P. Subdistrict Bureau of Statistics Sekongkang Bawah

18 Muhiddah Village Rep. Council Sekongkang Bawah

Page 13

Location : Maluk Date : 10 December 2009 FOCUS GROUP DISCUSSION


AGENDA: 1. Introduction 2. Briefing on SIA 3. Data Verification 4. Discussion:


SUMMARY

Discussion was held at community center of Maluk Subdistrict. 26 reprentatives, two of them are women, participated in the meeting. They are from five villages: Benete, Bukit Damai, Maluk, Maluk Mantun, and Pasir Putih. Discussion went well and very dynamic. Some significant points from the meeting are as follows:

1. There some mistakes in the village profile the data provided by Amec. The representatives from Maluk Loka and Mantun were not happy by the fact that the data were combined between the two villages.

2. In general people ackowledge the impacts brought by PT NNT, both positive and negative, details can be seen later in the report.

3. Community wish that PT. NNT: a. is consistent with funds allocation stated in Contract of Work for CSR; b. should be more strategic in selecting target group for its Comdev activities,

targeted at those who are committed to sustain the program only; c. should carry out economic justice for all; d. should continue develop and maintain the infrastructure; e. continue develop the Training Center (BLK); f. move the landfill relocation farther away from the dike.

4. For post mining: a. PT. NNT should develop more of basic infrastructure; b. PT. NNT should be consistent with the programs that were developed by NNT,

particularly in water system, supply of electricity, and development of tourism industry by building the capacity of the community to maintain, manage, and sustain the projects so that people have alternative solution for employment after the mining.

Page 14

DATA VERIFICATION

Village INPUT

Benete

On 1994 Village Profile: • People originated from four settlements: Singaloka, Tatarloka,

Jereweh, Nangkalanung.

On 2008 Village Profile:

• The number of people going to Shaman/traditional healer is higher than the data presented from Amec;

• Approximately 83 residents work for PT NNT (note: Belo should not be included in the profile because it belongs to Jereweh Subdistrict);

On PT NNT investment:

a. PT NNT only built the roof, while the foundation and the stage were built by community

b. SD 01 (Elementary School No. 01) should be changed to SDN, considering it was still SDN at the time of renovation;

c. Demobilization and Reconstruction Service Camp Hardies from Police to Benete KSB should not have been included in the profile because it is not for community benefit;

d. Landfill Expansion is actually located in Belo, Jereweh.

Bukit Damai


a. Total number of household is 665, total of approximately 3,000 residents;

b. Approximately 40% own their homes; hence, c. 60% rent their living quarters; d. 80% of resident have their own sanitary facilities; e. 20% of resident shared with others;


a. Village Office is not yet completed, thus, should be taken out

from the data

Page 15

Village INPUT

Maluk


a. There is 617 households, total of approximately 2,000 residents; b. Average size of 4 persons; c. Average age of the household head is about 35 years old; d. About 40% resident rent their living quarters; e. About 60% have incomes less than 1,500,000 rupiah per month; f. About 20% people have income between 1,500,000 – 3,500,000

rupiah per household per month; and g. 20% people earn more than 3,500,000 rupiah per household per

month.

On PT NNT investment: a. Jobs Sewer (PAR) is for PT NNT industrial waste, therefore,

should not be included in PT NNT Comdev investment; b. Sekongkang-Maluk Road cut back, to people knowledge is local

government program, not PT NNT.

Maluk Mantun


a. There are 598 households with total of 1,893 residents; b. Average size is 3.2 persons; c. Average age is 37 years old; d. Approximately 55% of the homes is semi permanent to permanent e. Approximately 40% rent tehir living quarters; f. Approximately 90% have their own sanitary facilities; g. All respondents have acess to well water or provided by water

organization/PDAM ; h. Approximately 60% households have incomes less than 1,500,000

per month per household; i. Approximately 20% households have incomes between 1,500,000 to

3,500,000 per month per household; and j. Approximately 20% households have incomes more than 3,500,000

per month per household.

Pasir Putih All data is valid except on the village profile on the percentage of ownership of semi permanent homes is only 30%

Page 16

IMPACTS

IMPACTS SECTOR

POSITIVE NEGATIVE

HEALTH

a. Increased number of health facilities, for example: in the past there was only Pustu (health post), now there are health center (Puskesmas) at subdistrict level and village health clinic (Puskesdes)

b. Prevalence rate of Malaria has dropped drastically;

c. Maternal and infant mortality rates have been decreased;

d. Improved nutrition for children;

e. Better health service; f. Healthier lifestyle with

sanitary facilities built by PT NNT;

g. The number of medical staff has also been increased;

h. Family Planning program has been successful;

i. Easier access to water.

a. Sexually transmitted diseases have become common now;

b. Medical expenses have increased/become expensive;

c. Health service is poor given the increased number of population. Discrimination in health service is common between PT NNT Staff and non PT NNT employees whereby NNT employees are better served;

d. Pollution resulted from household wastes;

e. Water from well has decreased;

Page 17

IMPACTS SECTOR

POSITIVE NEGATIVE

EDUCATION

a. Education facilities for all levels, from kindergaarten to high school, are available;

b. Increased number of schools; (from two elementary schools to five)

c. Drop out rate has dropped;

d. Illiteracy rate has decreased;

e. Better and improved human resources;

f. More teachers are well channeled;

g. Scholarship is available both for students with good record and for students from poor families;

h. Education facilities are closer, hence accesible;

i. E-books through internet access for students are available;

j. School library and mobile library are available.

a. Quality of education are not reliable as many teachers are not committed due to small honorarium given to them, therefore they have to moonlight .

b. Formal education become expensive because of additional course taken by student in order to perform well;

c. Number of school is not proportionate with increased number of students;

d. Increased price of schools accessories: uniforms, bags, etc.

SOCIAL

a. Better social interaction due to better road condition;

b. Increased number of population;

c. Better employment or business opportunities;

d. Increased income, hence standard of living;

a. Increased social diseases: HIV/AIDS, drugs, prostitution, and crime;

b. Increased polygamy c. Shifting of values from

social solidarity to individualistic;

d. Arefree lifestyle for teenagers;

e. Consumptive lifestyle; f. Indigenous people are

marginalized; g. Pollution (water, air and

noise).

Page 18

IMPACTS SECTOR

POSITIVE NEGATIVE

AGRICULTURE/ LIVESTOCK

a. Shifting planting pattern from paddy to horticulture product to meet demands;

b. Agricultural product is easy to sell;

c. Livestock management is better.

a. Agricultural land has decreased;

b. People have less interest to become farmers, as they are more interested to work for PT NNT;

a. Buffalos become very scarce, due to less paddy fields (note: buffalo is the district’s icon);

OTHERS

a. Better facilities of transportation;

b. Significant increased number of people who own car or motorcycle;

c. Better spatial planning, residential areas are also in good order with drainage and street lighting;

d. Telecommunication network is available.

a. In the past people had no problem finding turtle or getting fish; hence

b. People used bad way in getting fish by using potassium that has bad impact to coral reefs;

c. People have limited public space.

NOTES:

1. On presentation, community expressed their reservationon combined villages of Mantun and Maluk Loka;

2. Historically, Maluk Hamlet was a settlement near Perigi Mountain. The settlers were Sumbawas from Goa in Jereweh subdistrict, Sasaks (Lombok), and Javanese.

3. In 1994, Maluk was still a hamlet and part of Jereweh with total population of 124.

Page 19



Maluk, 10 December 2009


1 Riva'i Village Staff Bukit Damai

2 Nursim Village Staff Mantun

3 M. Husni Village Rep. Council Benete

4 Abdul Rahman H. Village Rep. Council Benete

5 Zumiati Village Staff Benete

6 Zainuddin Ali Village Rep. Council Benete

7 Mahdi Village Staff Benete

8 Sahidullah Village Staff Benete

9 Ratmaji Village Chief Maluk

10 Hamzah Hasan Chief of Village Rep. Council Maluk

11 Thalib Subdistrict Staff Maluk

12 Ahmad Subdistrict Staff Maluk

13 Syafi'udin Community Leader Mantun

14 Tries Wulan B. Village Rep. Council Bukit Damai

15 Suwandi Village Rep. Council Bukit Damai

16 Ahmad Yani Village Rep. Council Mantun

17 Ahmad Zaini Hamlet Chief Mantun

18 Rano K. Village Staff (West Mantun) Mantun

19 Turiman A. Community Leader Mantun

20 Langgeng Rudi S. Village Rep. Council Pasir Putih

21 Saparuddin Subdistrict Staff on Public Order Benete

22 Imran Village Staff Pasir Putih

23 Suhardy Community Leader Pasir Putih

24 Abdul Manan Community Leader Bukit Damai

25 Mul Nyardi Chair, Village's Enterprises Bukit Damai

26 Muhammad Basri Village Rep. Council Desa Pasir Putih

Page 20

Location : Goa, Jereweh Date : 11 December 2009 FOCUS GROUP DISCUSSION


AGENDA: 1. Introduction 2. Briefing on SIA 3. Data Verification 4. Discussion:


SUMMARY

Discussion was held at community center of Jereweh Subdistrict which is located in Goa Village. 40 reprentatives, four of them are women, from four villages: Belo, Beru, Dasan Anyar, and Goa attended the meeting. Couple of participants expressed their resistance towards the discussion for the following reasons:

1. The invitation stated that the meeting is to socialize the Amec’s survey result, in reality it talks about social impacts;

2. It would be difficult to capture the social impact in a short time; 3. The meeting is useless, it was just another chit chat with no follows up from PT

NNT;

Nevertheless, most of the participants agreed and the discussion continued, though not all were discussed, overall it went well and has its own dynamism. Some significant points from the meeting are as follows: • Most of the data presented is valid, only some correction was made, such as the

name of Dasan Village which is actually called Dasan Anyar; • Some participants believed that PT. NNT had failed in managing community,

particularly in increasing the capacity of the people; • People in general are very proud of PT NNT presence but unfortunately people’s

welfare has not been properly increased like other mining areas in Kalimantan; • Lack of coordination and communication on development issues between in PT.

NNT and local government; Local government depends on NNT for development in mining area, as a result, budget allocation in this area is reduced;

DATA VERIFICATION

VILLAGE INPUT

Page 21

VILLAGE INPUT

Belo

On 2008 Village Profile: • There are less than 144 residents work for PT NNT, some of them

were not from Belo, they forged their identity to enable them to work for PT NNT.

On PT NNT investment: • No garbage landfill, only village garbage truck procurement • House of worship is ‘musholla.’

Beru

On 2008 Village Profile: • There are 152 work for PT NNT, actually is only 113 residents;


• MTS and SMU mentioned here are actually located in Belo.

Dasan Anyar

On 2008 Village Profile: • The name of Dasan Village which is actually called Dasan Anyar; • All data are valid.

Goa

On 2008 Village Profile: Most data is valid except the number of residents who work for PT.NNT, it is only about 60 residents; On PT NNT investment: The landmark monument is located in Beru Village administration;

IMPACTS

IMPACT SECTOR

POSITIVE NEGATIVE

HEALTH

1. Increased number of health facilities built or renovated by PT NNT.

2. Improved basic service; 3. Prevalence of Malaria rate has

dropped down; 4. Better spatial planning in the

villages which brings comfort; 5. Better nutritioned children

Page 22

IMPACT SECTOR

POSITIVE NEGATIVE

EDUCATION

1. Improved and increased number of education facilities from kindergaarten to high school (including private school, i.e., Madrasah)

2. Education subsidies for, both students with good records and students from poor families;

3. improved knowledge through books and libraries facilities;

4. Drop out rate has dropped; 5. Increased number of students

who finish high school (completion rates) through additional cram program from Primagama.

1. Bureaucratic process for any proposal assistance. Comdev should be more proactive;

2. Some other participants argued that the Primagama facilitation did not help to significantly increase the grades of the graduate;

3. Lack of commitment of teachers due to small honorarium which compel them to moonlight;

SOCIAL

1. Improved and better interaction amongst community members due better transporation;

2. Improved living standard; 3. Better access to water.

1. The influx of migrants had contributed to the shifting values of social solidarity to individualistic;

2. Social gap between migrants and indigenous communities;

3. Unhealthy competition between the ppors and the haves.

AGRICULTURE

1. Better water system through dike and irrigation;

2. Reduced production cost through agricultural assistance;

3. Empowerment to farmers through CO.

1. Dike cannot store rain water all year long to facilitate farmers’ need;

2. Assistance to farmers should be continuous and proven to be successful.

Page 23

IMPACT SECTOR

POSITIVE NEGATIVE

OTHERS

1. Increased employment and business opportunity;

2. Reduced poverty rate; 3. Increased and improved road

oinfrastructure.

1. The number of local recruitment is not proportionate with total population;

2. Many migrants workers forged their identity to become local residents so that they can work for PT NNT;

3. Lack of sense of ownership of all projects funded by NNT;

4. Injustice in Comdev program between one village to another;

5. No floods in the past, but now it happens;

6. Optimization of local contractors is still low.

NOTES

• Many community program proposals were not followed up, which ; • PT. NNT comdev project and its plan for 2010 should also be presented; • Community recommended that:

1. Local recruitment should be increased; 2. Relationship with External should be improved; 3. Better communication with community in mining area; 4. Capacity building for teachers and students should be provided; 5. Community development plan should prioritize to those that has sustainability

values.

4. Post Mining: There are issues that community deem important as indicated below:

a. Development of irrigation for agriculture is needed; b. Recovery of villages that are impacted by the mining activity; c. Human resources should be prepared to anticipate mining closure.

Page 24



Jereweh, 11 December 2009


1 Abdul Rauf Tunru Village Office Staff Goa

2 Syahri B. Village Rep. Council Goa

3 R. Agustono Village Rep. Council Dasan Anyar

4 Abdul Gani, S.Pd Village Rep. Council Dasan Anyar

5 Zulkarnaen Village Office Staff Goa

6 Zubirdin S. Village Rep. Council Goa

7 Syahabuddin Village Rep. Council Goa

8 Wiwin Hasidah Village Rep. Council Goa

9 M. Solihin Village Rep. Council Beru

10 Nur Intan Village Office Staff Belo

11 Eko Sirajuddin Village Office Staff Dasan Anyar

12 Dedy Irwansyah Village Office Staff Dasan Anyar

13 Ahmad Dahlan Village Office Staff Belo

14 Ismail A. Village Office Staff Belo

15 Makawaru Village Office Staff Belo

16 Hermansyah S. Village Rep. Council Belo

17 Dedy Syah S. Village Rep. Council Beru

18 Rudi Village Rep. Council Belo

19 Misbat Village Office Staff Beru

20 Zainuddin Village Rep. Council Belo

21 Abdul Hamid Village Office Staff Goa

22 Hendrajaya Village Rep. Council Belo

23 Hasanuddin Beru

24 D. Syamsuddin Village Rep. Council Belo

25 Abdullah M. Village Rep. Council Beru

26 Suciati KSM Beru

27 Trisna KSM Belo

28 Misrurrahim Village Rep. Council Belo

29 Abdul Rahman Village Chief Beru

30 Hasanuddin HP Village Rep. Council Beru

31 Abdul Kadir HG Village Office Secretary Goa

32 Fitranullah Village Office Staff Dasan Anyar

33 Abdul Aziz Village Office Staff Dasan Anyar

34 Syarifuddin Village Office Staff Beru

Page 25


35 Drs. Wahiduddin Village Rep. Council Goa

36 Rabiollah MS. Development Division Desa Beru

37 Ahmad Yani Subdistrict Office Staff Beru

38 Masud Yusuf Village Chief Goa

39 Syarifuddin H. Village Chief Dasan Anyar

40 Jafaruddin Subdistrict Office Staff Beru

Page 26

ANNEX

PHOTOS:

FGD Cluster 1, Tongo

Page 27

FGD Cluster 2 in Sekongkang Bawah

FGD Cluster 3 in Maluk

FGD Cluster 4 in Goa

Appendix D

PTNNT DONATION POLICYPTNNT DONATION POLICY

Nusa Tenggara

External Relations Department

Donation

Document No. : MGT024-03 Page 1 of 6 Version: 0.0 Issue Date : 19 June 2003 Review Cycle :2 year Author: xxxx Approval: Finance Director and Senior Manager External Relations

THIS DOCUMENT IN UNCONTROLLED IN HARDCOPY FORMAT

1. KEBIJAKAN PTNNT, pada intinya, memberikan sumbangan melalui Komite Sumbangan untuk mendukung prakarsa masyarakat lokal yang bernilai guna.

2. LATAR BELAKANG Kebijakan ini dimaksudkan untuk menjelaskan prosedur penerimaan, pemrosesan dan pengaturan permohonan sumbangan yang diajukan oleh masyarakat.

3. DEFINISI “Sumbangan” – Pemberian Perusahaan baik yang berupa uang tunai atau material berharga kepada pihak luar. “Komite Sumbangan” – Panitia yang memiliki hak suara, beranggotakan Presiden Direktur PTNNT, Kepala Teknik /General Manager PTNNT, Manajer Senior Hubungan Eksternal, Manajer Senior SDM, Direktur Keuangan atau pejabat yang mewakili mereka yang akan mengkaji dan menyetujui/menolak/menyempurnakan permohonan sumbangan yang diajukan masyarakat. Dua orang anggota yang tidak memiliki hak suara akan melibatkan Corporate Counsel PTNNT dan Spesilis Senior Administrasi Dept. Hubungan Kemasyarakatan.

4. TANGGUNG JAWAB Bagian Sumbangan/Hubungan Eksternal a) Menerima, memproses dan mengajukan

permohonan sumbangan ke Komite Sumbangan untuk dikaji dan disetujui.

b) Melaksanakan keputusan Panitia Sumbangan

terkait permohonan sumbangan. Komite Sumbangan a) Mengkaji dan

menyetujui/menolak/mengubah permohonan sumbangan setiap bulan atau sesuai kebutuhan.

b) Anggota yang tidak memiliki hak suara, dalam hal ini, Corporate Counsel PTNNT, akan memeriksa permohonan sumbangan dari instansi atau pejabat pemerintah untuk

1. POLICY PTNNT primarily grants donations through its Donation Committee to support worthy local stakeholder initiatives.

2. BACKGROUND This policy is intended to outline the procedures for the receipt, processing and disposition of stakeholder requests for donations.

3. DEFINITIONS “Donations” – The Company’s gifts of monetary or material value to external stakeholders. “Donation Committee” – A committee of voting members consisting of the President Director of PTNNT, PTNNT Kepala Teknik/General Manager, Senior Manager External Relations, Senior Manager HRD, Finance Director, or their respective delegates, who shall review and approve/disapprove/ modify external stakeholder requests for donations. Two non-voting adjunct members will include the Corporate Counsel for PTNNT and the Community Relations Senior Specialist for Administration.

4. RESPONSIBILITIES

Donation Section/Community Relations a) Receive, process, and present external

stakeholder requests for donations to the Donation Committee for review and approval.

b) Implement the decisions of the Donation Committee regarding requests for donations.

Donation Committee a) Voting members review and

approve/disapprove/modify donation requests on a monthly and as required basis.

b) The non-voting adjunct member from Corporate Counsel for PTNNT will review donations’ requests from Government offices or officials to ensure legal and PACI compliance.

Nusa Tenggara


Donation



memastikan kepatuhan hukum dan ketentuan PACI.

c) Anggota yang tidak memiliki hak suara, dalam hal ini, Supervisor Senior Administrasi akan mengkoordinasi kebutuhan logistik dan memastikan semua persyaratan administrasi dipenuhi sesuai prosedur/kebijakan Sumbangan PTNNT.

Senior Manager External Relations a) Mengkaji dan menyetujui/menolak

/mengubah permohonan sumbangan yang jumlahnya sama dengan atau kurang dari Rp 2,5 juta.

Kepala TeknikTambang/General Manager a) Berkoordinasi dengan dan atas petunjuk dari

Direktur Regional ESR-Indonesia, memeriksa dan menyetujui/menolak/mengubah permohonan sumbangan yang bersifat mendesak dan di luar waktu yang ditentukan.

Accounts Receivable Section a) Membuat dan mengelola daftar uang muka

yang belum dilaporkan penggunaannya yang berkaitan dengan sumbangan.

b) Mengelola cost code (work order??) khusus untuk sumbangan

5. IMPLEMENTASI 5.1 Penjelasan tentang Sumbangan 5.1.1 Permohonan sumbangan dari

masyarakat/pemangku kepentingan eksternal biasanya diserahkan ke Perusahaan dalam bentuk proposal tertulis, surat, email atau atas prakarsa PTNNT sendiri secara tertulis. Semua permohonan sumbangan harus mencantumkan : (i) nama orang penerima atau organisasi (ii) uraian tentang permohonan sumbangan yang diajukan (iii) maksud (iv) jumlah sumbangan yang diajukan. Setiap permohonan sumbangan/inisiatif dan rekomendasinya akan disimpan dalam Register selama 5 tahun sebagai bahan kajian oleh pemangku kepentingan internal dan eksternal.

5.1.2 Pemberian sumbangan biasanya dilakukan

melalui i) transfer bank ke nomor rekening pemohon, ii) cek yang hanya diberikan

c) The non-voting adjunct member

Community Relations Senior Supervisor for Administration will coordinate logistics requirements and ensure administrative compliance with PTNNT Donation Policy procedures.

Senior Manager External Relations a) Review and approve/disapprove/modify

donation requests for amounts equal to or less than Rp 2.5 million .

Kepala TeknikTambang/General Manager a) In coordination with and with advice from

the Regional Director ESR-Indonesia, review and approve/disapprove/modify out-of-cycle, urgent donation requests.

Accounts Receivable Section a) Create and maintain a list of outstanding

advances for donations. b) Maintain a separate cost code (work order?)

for donations.

5. IMPLEMENTATION 5.1 General Overview of Donation Policy 5.1.1 External stakeholder donation requests

will be submitted to the Company in the form of a written proposal, letter, email or as a PTNNT written initiative. All requests must include (i) the name of person or organization (ii) a description of the request (iii) the purpose (iv) the amount requested. Each request or initiative and its outcome will be maintained for five years in a Register for review by internal and external stakeholders.

5.1.2 Donations will normally be made by i)

transfers to the requester’s bank account, ii) by check issued only to the bearer

Nusa Tenggara


Donation



kepada nama yang tercantum di cek, atau iii), bukan dalam bentuk uang namun dalam bentuk material/bahan bangunan, makanan pokok, transportasi, dll . Pemberian uang donasi tunai secara langsung dibatasi hingga Rp 500.000 kecuali mendapat persetujuan khusus dari Kepala Teknik atau Direktur Regional ESR dengan pendapat dari bagian Hukum.

5.1.3 Semua sumbangan dalam bentuk tunai

harus disertai pengisian Keterangan Penerimaan Sumbangan (lihat Lampiran A) yang ditandatangani oleh pemohon. Ini akan dilampirkan pada laporan pengeluaran dan digunakan sebagai dasar dalam mengurus laporan penggunaan dana terkait.

5.1.4 Permohonan sumbangan diklasifikasikan sebagai mendesak – tidak mendesak, DAN memiliki dampak penting atau kurang penting bagi Perusahaan. “Mendesak” artinya apabila sumbangan dimaksud terbatas waktunya dan harus diberikan sebelum rapat Komite Sumbangan berikutnya diadakan. “Memiliki dampak penting” artinya apabila sumbangan tidak diberikan akan dapat menimbulkan kekacauan yang berakibat terganggunya operasi Perusahaan atau pemberian sumbangan yang berdampak positif terhadap Izin Sosial untuk beroperasi.

5.1.5 Sumbangan dengan nilai sebesar atau lebih

kecil dari Rp 2,5 juta akan ditangani sesuai kebijakan Manajer Senior Hubungan Eksternal. Setiap bulan, sumbangan yang disetujui untuk kategori ini, akan dirangkum dan diserahkan kepada Komite Sumbangan untuk dikaji dan mendapatkan masukan/komentar.

5.1.6 Dalam kondisi apa pun, tidak

diperkenankan memberikan sumbangan secara tunai kepada pejabat atau instansi pemerintah atau mengirim langsung ke rekening pribadi. Sumbangan kepada pemerintah hanya akan diberikan jika terdapat permohonan resmi dari pemerintah. Sumbangan tersebut harus berupa bahan/material, layanan jasa yang dibayar

stated on the check, or iii) donation of material in non-monetary form (e.g., building materials, basic staples, transport, etc.). Direct cash donation handlings are limited to Rp 500,000 unless special approval is obtained from either the Kepala Teknik or the Regional Director ESR with review by Legal..

5.1.3 All direct cash donations will have a Statement of Donation Receipt (See Attachment A) signed by the requester. This will be attached to expense reports and used as the basis for settling the related advance.

5.1.4 Donation requests will be classified as

urgent or non-urgent AND having significant or limited impact on the Company. “Urgent” is when the donation is time-sensitive and needs to be acted on before the next Donation Committee meeting. “Having significant impact” is when the potential ramifications of not acting on the donation could affect Company operations or that approving the donation could positively impact the Company’s Social License to Operate.

5.1.5 Donation amounts of up to Rp 2.5 million

in value will be acted on at the discretion of the Senior Manager External Relations. Each month, approved donations in this category will be summarized and provided to the Donation Committee for review and input.

5.1.6 Cash donations are not permissible to

Government offices or officials or to a personal bank accounts under any circumstances. Donations to the Government will only be made based on official government requests. Donations will be in the form of materials, services paid for by PTNNT or deposits to official accounts.

Nusa Tenggara


Donation



oleh PTNNT atau ditransfer ke nomor rekening resmi [pemerintah].

5.2 Penyerahan Proposal Permohonan

Sumbangan 5.2.1 Proposal permohonan sumbangan yang

masuk akan diserahkan ke Bagian Sumbangan untuk pengkajian awal guna menentukan urgensi dan kemungkinan dampaknya serta apakah permintaan sumbangan tersebut memenuhi sasaran dan tujuan serta prosedur Perusahaa terkait permohonan sumbangan oleh pemangku kepentingan eksternal

5.2.2 Bagian Donasi akan menyiapkan daftar permohonan sumbangan untuk disampaikan kepada Komite Sumbangan di setiap rapat bulanan.

5.2.3 Bagian Donasi juga akan menyiapkan daftar permohonan sumbangan untuk bulan sebelumnya, termasuk sumbangan yang di luar periode yang telah ditentukan kepada Komite Sumbangan. Daftar ini harus dilengkapi dengan pernyataan status terkini dana yang telah dialokasikan untuk sumbangan.

5.2.4 Bagian Donasi harus menyiapkan surat penolakan terkait permohonan sumbangan kepada pemohon sumbangan untuk ditandatangani oleh Ketua Komite Sumbangan atau Manajer Senior Hubungan Eksternal dan mengirimkannya dalam waktu 14 hari setelah keputusan diambil oleh Komite Donasi.

5.3 Pengkajian dan Persetujuan atas

Permohonan Sumbangan 5.3.1 Komite Sumbangan harus secara saksama

mengkaji permohonan sumbangan dan memutuskan apakah sumbangan tersebut perlu dikabulkan atau tidak. Pada umumnya, sumbangan tidak boleh diberikan kepada individu, partai politik atau kelompok-kelompok yang memiliki agenda politik.

5.3.2 Komite Sumbangan akan membubuhkan keterangan pada daftar sumbangan “disetujui, ditangguhkan, diubah [nilai sumbangan yang diberikan], atau ditolak serta menetapkan formulir sumbangan terkait. Persetujuan sumbangan harus

5.2 Donation Request Submissions 5.2.1 Incoming donation requests will be

forwarded to the Donation Section for initial review to determine urgency and potential impact and determine if the request meets Company goals and objectives and procedures governing external stakeholder requests for donations.

5.2.2 The Donation Section will prepare a

register of donation requests for presentation to the Donation Committee at their monthly meeting.

5.2.3 The Donation Section will also prepare a list of donation requests of the previous month, including approved out-of-cycle donations, to the Donation Committee for their review and information. This list will be accompanied by a statement of the current status of funds allocated for donations.

5.2.4 Letters informing external stakeholders of disapproval of donation requests will be prepared by the Donation Section, submitted for signature by the Chairman of the Donation Committee or Senior Manager External Relations, and sent out within 14 days of the Donation Committee decision.

5.3 Review and Approval of Donation

Requests 5.3.1 The Donation Committee shall

thoroughly review donation requests and decide whether to grant the donation. In general, donations will not be made to individuals, political parties or groups pursuing a political agenda.

5.3.2 The Donation Committee will annotate

each item on the list of donations requests as approved, deferred, modified or disapproved as well as stipulate the relevant donation form (i.e., monetary or non-monetary). Approvals Requires

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mendapat paling sedikit disepakati oleh 3 anggota dari komite sumbangan.

5.3.3 Komite Sumbangan juga harus mengkaji status daftar permintaan sumbangan yang telah disetujui pada bulan sebelumnya, termasuk sumbangan di luar periode yang ditetapkan.

5.3.4 Sumbangan yang bersifat mendesak dan memberikan dampak penting [bagi Perusahaan] bisa dipertimbangkan dan disetujui oleh Kepala Teknik/General Manager , Direktur Regional ESR-Indonesia atau pejabat yang ditunjuk di luar pertemuan bulanan atau dengan meminta suara terbanyak anggota Komite Sumbangan.

5.4 Pembayaran Permohonan Sumbangan

yang Disetujui 5.4.1 Bagian Donasi akan menyiapkan Formulir

Pembayaran dan memisahkan formulir untuk setiap jenis metode pembayaran (tunai, cek, transfer bank, dan non-tunai/material).

5.4.2 Cara pembayaran yang ditentukan pada

Formulir Pembayaran harus sesuai dengan yang tersebut pada daftar permintaan sumbangan yang disetujui.

5.4.3 Pembayaran dengan cek harus semata-mata dilakukan kepada pemohon sumbangan. Pembayaran melalui transfer bank harus dilakukan langsung ke rekening bank pemohon sumbangan. Pembayaran secara tunai, bila memungkinkan, tidak dilakukan dan jika dilakukan nilainya tidak boleh melebihi Rp. 2.5 juta tanpa melalui persetujuan dan rekomendasi dari bagian hukum.

5.4.4 Ketika pembayaran sudah disetujui dan dibayarkan oleh Accounts Payable, dan untuk sementara disimpan di Vault ComRels sebelum diberikan kepada penerima, maka semua transaksi keluar masuk vault harus dicatat. Dana yang disimpan dibatasi hanya sampai satu periode selama 7 (tujuh) minggu dan besarnya tidak melebihi Rp. 50 juta pada periode tersebut.

5.4.5 Setiap bulan, Accounts Receivable harus membuat daftar uang yang belum

agreement from at least 3 members of the committee.

5.3.3 The Donation Committee shall also review the status of previous month’s list of approved donation requests, including out-of-cycle donations.

5.3.4 Urgent and/or significantly impacting

donation requests may be reviewed and approved outside the monthly Donation Committee meeting by the Kepala Teknik/General Manager, the Regional Director ESR-Indonesia or their delegate or by soliciting the comments from a majority of the Donation Committee members.

5.4 Payment of Approved Donation

Requests 5.4.1 The Donation Section will prepare a

Payment Request Form for each approved donation request and separate the Forms according to method of payment (i.e., cash, check, bank transfer, or non-monetary).

5.4.2 The payment method specified on the Payment Request Form is to match the method stipulated on the list of approved donation requests.

5.4.3 Payment by check shall be made solely to the donation requester. Payment by bank transfer shall be made to the bank account of the donation requester. Payment by cash will be avoided if at all possible and may not exceed Rp 2.5 million without specific approval and legal review.

5.4.4 When an approved monetary payment has been duly issued by A/P and it is temporarily stored in Com Rels Vault prior to issuance to the intended recipient, all movement of such funds into and out of the safe shall be recorded in a register. Funds stored will be limited to covering payments for a seven (7) week period and will not exceed Rp 50 million at any given time.

5.4.5 The Accounts Receivable Section is to create a list of outstanding advances

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dilaporkan penggunaannya yang terkait dengan sumbangan. Daftar ini diserahkan kepada Manajer Hubungan Kemasyarakatan, Manajer Senior Hubungan Eksternal dan Direktur Keuangan untuk dikaji dan ditindaklanjuti.

5.5 Pengadaan dan Distribusi Sumbangan 5.5.1 Penyerahan sumbangan tunai dilakukan

oleh petugas lapangan Community Relations atas nama PTNNT dan meminta penerima untuk menandatangani Pernyataan Penerimaan Sumbangan (Lihat Lampiran A).

5.5.2 Khusus untuk sumbangan nontunai , Supervisor Senior Administrasi – Community Relations harus memperoleh bahan yang diperlukan di pasar lokal apabila memungkinkan, lalu menempelkan stiker PTNNT pada barang tersebut, dan meminta tanda tangan penerima sumbangan (Lihat Lampiran A).

5.5.3 Biasanya, sumbangan dalam bentuk material berasal dari stok persediaan PTNNT atau dibeli melalui prosedur pembelian normal. Apabila dibeli langsung, salinan kwitansi pembelian harus disimpan untuk keperluan pelaporan penggunaan dana dan pelaporan biaya.

5.6 Keseluruhan cara pemrosesan sumbangan

diuraikan pada Lampiran B. Tertanda Huia Taylor General Manager Operations Tanggal: 1 Maret 2009 Lampiran:

Pernyataan Penerimaan Sumbangan Diagram Alir Pemrosesan Sumbangan

related to donations on a monthly basis. This list is to be distributed to the Manager Community Relations, Senior Manager External Relations and Finance Director for their review and follow up.

5.5 Donation Procurement and Distribution 5.5.1 The disbursement of cash donations is to

be handled by Community Relations field officers on behalf of PTNNT in exchange for a Statement of Donation Receipt to be signed by each donation recipient (See Attachment A).

5.5.2 Specifically for non-monetary donations, the Sr. Supervisor Administration in Community Relations shall procure the approved requested materials in local markets whenever possible, affix a PTNNT sticker to the item, and obtain the recipient’s signature on the Statement of Donation Receipt (Attachment A).

5.5.3 Normally, material donations will either be from PTNNT inventories or purchased through normal purchasing procedures. When material is purchased directly, copies of receipts of the purchases shall be retained for advance settlement and expense reporting purposes.

5.6 The entire donation processing is such

described in the Attachment B.

Signed Huia Taylor General Manager Operations Date: 1 March 2009 Attachments:

Statement of Donation Receipt Flowchart of Donation Processing

Appendix E

COMMUNITY DEVELOPMENT (COMDEV)COMMUNITY DEVELOPMENT (COMDEV) INVESTMENTS, DISTRICT AND COMMUNITY INVESTMENTS, DISTRICT AND COMMUNITY

2000 - 2009 2000 - 2009

Location Investment Inverstment Type Jereweh Sub-District Belo Road Investments: Farming Road Improvement - Completion in 2009 Accces

Drainage Investments:

Public Work Phase I (1,474 m) - Completed November of 2000 Drainage

Public Work Phase II (1,588.7 m) - Completed November 2001 Drainage

Drainage Phase III (1,750 m) - Completed July 2003 Drainage

Drainage and Road Maintenance (1,750 m) - Completed September 2004 Drainage / Access

Village Drainage Channel Development (continued) - Completed August 2005 Drainage Irrigation - Completed in 2006 Drainage Irrigation Weir, Channel / Pad Preparation, Hydrologic Survey - Completed 2007 Drainage

Irrigation, Phase II - Completed October 2008 Drainage

Irrigation, Phase III - Started in June 2009 Drainage

Other ComDev Investments and Projects Include:

Village Garbage Truck Procurement (Beru, Belo and Goa), Garbage collection and landfill - Completed April 2005 Public Health

Health Building - Completed July 2005 Public Health

Total Rehab School SD 02 - Completed August 2005 Eduacation

Village Women’s House Rehabilitation - Started August 2005

Shelter Development / Football Field - Completed December 2005 Recreation

Women’s House Rehabilitation, Phase II - Completed October 2006

SDN Education Building Fencing - Started in 2006 Eduacation

SDN Education Building Paving Phase II - Completed March 2007 Eduacation

Making Public Podium - Completed June 2008 Infrastucture

Houses of Worship (musholla) / Public Places - Completed April 2009 Religion Library Building SMU Jereweh - Completed September 2005 (Appendix C) Eduacation Development of MTS - Completed June 2008 (Appendix C) Landfill Expansion - Completed April 2009 (Appendix C) Public Health

Beru Drainage Investments: Public Work Phase I (1,912 m) - Completed November of 2000 Drainage


Drainage Phase III (1,750 m) - Completed October 2003 Drainage

Location Investment Inverstment Type

Drainage and Road Maintenance (1,750 m) - Completed September 2004 Drainage / Access

Village Drainage Channel Development (383 m) (continued) - Completed August 2005 Drainage


Beru SD Jereweh, Up Grade - December 2004 Eduacation


SLTP 1 Rehab. Phase II - Completed September 2005

Library Building SMU Jereweh - Completed September 2005 Eduacation

Up grade Jereweh health center - Completed November 2005 Public Health

Jelenga Toilet (1 unit) - Started July 2006 Public Health

Puskesmas Jereweh Up Grade + Furniture, Phase II - Completed - September 2006 Public Health

Posyandu (Health Building) - Started August 2006 Public Health

Puskesmas Jereweh Up Grade + Furniture, Phase III - Completed December 2007 Public Health

SMAN Jereweh Fencing + Landscape - Started June 2006

SMPN I Jereweh Up Grade - Started April 2006

Beru SD Construction - Completed August 2006 Eduacation

Renovation Works SDN Jereweh - Completed February 2007 Infrastucture

Kinder Garden (2 units : TK PGRI dan SDN Beru) - Completed December 2007 Eduacation

SMAN Jereweh Phase III (Teachers Office) - Completed February 2008 Eduacation

SDN Jelengah Up Grade - Completed December 2008 Eduacation

Fences TK & SDN PGRI 01 Paving - Completed August 2008 Eduacation

Junior Library - Completed November 2008 Eduacation

Development of MTS - Completed June 2008

SDN Maintenance 2 Unit - Completed May 2009 Eduacation

Ball Field Fence - Completed July 2009 Infrastucture

Maintenance Market - Completed August 2009 Infrastucture

Fence SDN Jelenga - Completed October 2009 Eduacation Dasan Anyar Drainage Investments: Public Work Phase I (1,203 m) - Completed November of 2000 Drainage

Additional, Public Work Phase I (600 m) - Completed December 2000 Drainage


Public Work Phase II (600 m) - Completed November 2001 Drainage

Channel Irrigation / Drainage Phase III (2250 m) - Completed October 2003 Drainage

Irrigation Tereng and Lang Lang Kunam - Completed April 2005 Drainage

Irrigation Lang Jorok - Completed August 2009 Drainage

Other ComDev Investments and Projects Include: Primary School Rehabilitation foundation Jereweh - Completed February 2004 Eduacation

Kinder Garden - Completed October 2005 Eduacation

Posyandu (Health Building) - Completed October 2008 Public Health

SDN Maintenance - Completed August 2009 Eduacation

Goa Road Investments: Bridge Quick Fix (30 m) - Completed February 2001 Access

Fence Road Circle and the field - Completed July 2009 Access

Farming Road Improvement (6 km) - Completion in 2009 Access


Public Work Phase I (695.5 m) - Completed November of 2000 Drainage


Public Work Phase III (1,750 m) - Completed October 2003 Drainage

Drainage and Road Maintenance (1,750 m) - Completed December 2004 Drainage

Development of irrigation channels "lang kunam" foundation and drainage of the village (continued) - (837 m) - Completed

August 2005

Drainage



Soccer Stage - Completed July 2005 Infrastucture

SDN Education Building Up Grade - started May 2006 Eduacation

SDN Education Building Paving - Completed December 2006 Eduacation

Health Building - started July 2006 Public Health

SDN 1 Education Building Fencing, Wash Tape and New Toilet For Teachers, Completed December 2007 Eduacation

District Border Gate - Completed November 2007 Infrastucture

Multipurpose Building, Government Office Stage and Shelter - Completed November 2008 Infrastucture

Installation of Landmark Monument - Completed 2008 Infrastucture


Ball Field Fence, Multipurpose Building, Government Office Stage and Shelter - Completed July 2009 Infrastucture

Sekongkang Sub-District Ai’ Kangkung /Senetuk


SP-1 Irrigation (Channel), Phase II - Completed December 2003 Drainage

SP-1 Irrigation Channel , Phase 2 - Completed September 2005 Drainage


SLTP SP-1 Rehab. Existing Building ( Classroom ) - Completed November 2004 Eduacation

Labuhan Posyandu Senutuk - Completed July 2005 Public Health

Posyandu Ai’ Kangkung, SP1, Tongo - Completed August 2005 Public Health

Pustu Renovation - Completed March 2005 Pos P3A - Completed August 2005

Sekongkang Atas Road Investments: Road Improvement Between Sekongkang Atlas - Maluk (8 km) - Completed April 2003 Access

Street lighting lamps - Completed December 2005 Access


Channels / Drainage Sekongkang Atlas-Bawah (3,000 m) - Completed July 1999 Drainage

Irrigation Channel - Completed August 2000 Drainage

Public Work Phase I (2,465 m) - Completed December 2000 Drainage

Public Work Phase II (593.5 m) - Completed June 2002 Drainage

Drainage & Road Up Grade (366 m) - Completed August 2004 Drainage


Water Well Drilling - Completed August 2000 Infrastucture

Water System - Road Access & Tank Pad Site Prep. - Completed April 2001 Infrastucture

Water System - Drilling - Completed June 2001 Infrastucture

Water System - Water Tank Construction - Completed January 2002 Infrastucture

Water System - Pipe Installation - Completed 2003 Infrastucture

Water Recirculation - Completed August 2003 Infrastucture

River Stabilization (Gabion Install) - Completed December 2003 Infrastucture

River Stabilization (Gabion Fabricated) - Completed October 2004 Infrastucture


Community Health Center Facilities - Completed May 2005 Public Health

Water Facility Up Grade (purchase materials) - Completed July 2005 Infrastucture

Pos P3A - Completed July 2005

Soccer Stage - Completed July 2005 Infrastucture

River Stabilization ( Completion ), Phase 2 - Completed July 2005 Infrastucture

Town Symbol - Completed August 2005 Infrastucture

Pustu Renovation - Completed November 2005

Sekongkang Bawah

Road Investments:

Road Widening Improvement Govt. Road Government (1.2 km) - Completed February 2000 Access

Road Improvement Between Government Sekongkang Bawah-Tongo (13 km) - Completed April 2003 Access

Road Improvement Between the Government of Sekongkang Bawah-Tongo (9 km) - Completed April 2003 Access

Street lighting lamps - Completed December 2005 Access

Drainage Investments: Channels / Drainage Sekongkang Atas-Bawah - Completed July 1999 Drainage Channels / Drainage - Completed May 2000 Drainage


Public Work Phase II (347 m) - Completed January 2002 Drainage

Drainage (JSS Beside SKG) - Completed August 2004 Drainage Other ComDev Investments and Projects Include: Water System & Tank Access Road Pad Site Prep. - Completed April 2001 Infrastucture Water System - Drilling - Completed June 2001 Infrastucture Water System - Water Tank Construction - Completed January 2002 Infrastucture Water System - Pipe Installation - Continued in 2003 Infrastucture Water Recirculation - Completed August 2003 Infrastucture Maintenance SLTP - Completed July 2005 Health Post New Building - Completed September 2005 Public Health Soccer Stage - Completed July 2005 Infrastucture

Tatar Road Investments: T. Site Intersection - Road maintenance, mayor repair / priority road - Completed September 2003 Access

Tongo-SP2 Road Maintenance - Completed October 2004 Access



Rump Pump Study, SP2 - Completed August 2005 Drainage

SP2 Irrigation Construction - Completed December 2002 Drainage

Other ComDev Investments and Projects Include: Primary School Rehabilitation SP I & SP2 - Completed December 2002 Eduacation Total Rehab School SD 03 Tongo Phase II - Completed September 2005 Eduacation Pos P3A, Tatar - Completed August 2005 Eduacation

Talonang Baru No PTNNT Investments to date Tongo/Sejorang/Tamalang

Road Investments:

Tongo/Sejorong Village Road Improvement - Completed November 2000 Access

Township-Tongo Sejorong Govt. Road Maintenance (14 km) - Completed February 2001 Access

Govt. Road Maintenance, Repair Province Road Junction Townsite - Tongo - SPI / II (20 km) - Completed December 2001 Access

Road Improvement Between Government Sekongkang - Tongo (14.7 km) - Completed April 2003 Access

Road Improvement Between Government Sekongkang Bawah - Tongo (13 km) - Completed April 2003 Access

Road Improvement Between the Government of Lower Sekongkang - Tongo (Stone Rea-Tongo)(9km) - Completed April

2003

Access

Farmers Ai Road Improvements Brunei Tongo (1.3 km) - Completed September 2003 Access

Tongo Road Construction (14 km) - Completed December 2003 Access

Bridge repair Gorong Tongo-country road Sekongkang - Completed April 2004 Access

Sekongkang - Tongo Road (Bush Trimming) (15 km) - Completed May 2004 Access

Tongo-SP2 Road Maintenance (12 km) - Completed September 2004 Access


Public Work Phase I - Completed December 2000 Drainage

Public Work Phase II - Completed July 2002 Drainage

Tongo Sejorong Irrigation Survey - Completed October 2002 Drainage


Development of integrated health Tongo / Sejorong - Completed June 2000 Public Health

Sejorong/Tongo Water Operation - Completed October 2000 Infrastucture

Elementary School Renovation 01 Sejorong - Completed December 2001 Eduacation

Tongo-Sejorong Water Recirculation - Completed August 2003 Infrastucture

Soccer Stage - Completed August 2004 Infrastucture


Townhall at Puja Embung - Completed August 2004 Infrastucture

New Health clinics - Completed February 2005 Public Health

Health post Ai’ Kangkung, SP1, Tongo - Completed August 2005 Public Health

Total Rehab Elementary School 03 Tongo Phase II, SP2 - Completed September 2005 Eduacation

Pos P3A - Completed November 2005 Eduacation

Maluk Sub-District Benete Road Investments: Port road, drainage quick fix - Completed April 1999 Access

Benete-Jereweh road, drainage quick fix / Maintenance - Completed June 1999 Access

Road Realignment - Completed November 1999 Access

Maluk-Benete Boundary Road Paving (3.17 km) - Completed February 2000 Access

Benete-Jereweh Road Paving (10.35 km) - Completed March 2000 Access

Benete Road Paving (2.616 km) - Completed April 2000 Access

Govt. Road Maintenance, Maintenance and Repair Road Jereweh (12.816 km) - Completed December 2001 Access

Govt. Road Maintenance, Maintenance and Repair Road Jereweh (10.2 km) - Completed October 2002 Access

Benete-Jereweh Road Maintenance (34 km) - Completed July 2004 Access

Benete-Jereweh Road Improvement - Completed July 2005 Access

Light street lamps - Completed December 2005 Access

Road asphalting Benete cross section until police Maluk and Maluk Side Health Center - Completed July 2008 Access Tongo Village Road asphalting and road segment Benete, Maluk Sekongkang - Completed October 2008 Access Drainage Investments:

Irrigation Way Sirtu - Completed July 2008 Drainage


Channels / Drainage Way (3,050 m) - Completed January 2000 Drainage

Public Work Phase II (2,600 m) - Completed November 2001 Drainage

Public Work Phase III (1,154 m) - Completed December 2002 Drainage

Irrigation (Survey and Investigation) - Completed June 2004 Drainage

Irrigation - Completed September 2005 Drainage Irrigation, Phase II - Completed October 2006 Drainage Drainage Clearing - Completed February 2007 Drainage Irrigation, Phase III (Maintenance) - Completed May 2007 Drainage

Location Investment Inverstment Type Irrigation Maintenance - Completed March 2008 Drainage Other ComDev Investments and Projects Include:

Water System - Drilling - Completed August 1997 Infrastucture

Development of integrated health - Completed June 2000 Public Health

Water System - Road Access & Tank Pad Site Prep. - Completed September 2001 Infrastucture

Elementary School Renovation SDN - Completed October 2001 Eduacation


Water System - Pipe Installation - Started October 2002 Infrastucture

Water Reticulation - Completed August 2003 Infrastucture

Stage at Soccer Field - Completed July 2004 Infrastucture Benete Assessment (River Stabilization) - Completed August 2004 Infrastucture

Water Reticulastion - Completed August 2004 Infrastucture

Puskesmas Benete Up Grade - Completed September 2004 Public Health

Beach Facilities - Completed December 2004 Recreation Street Lighting Install - April 2005 Infrastucture Electricity PLN, Benete Street Lighting, Soccer Stage - Completed June 2005 Infrastucture

Posyandu Benete maintenance - Completed August 2005 Public Health

Construction of waste disposal landfill Maluk & Benete - Completed September 2005 Public Health

Kinder Garden - Completed October 2005 Eduacation

New Building SLTP2 - Completed October 2005 Infrastucture

Public Kiosk Station Rehabilitation - Completed January 2006 Infrastucture Mosque Renovation - Completed July 2006 Religion Junior Benete (Library + Laboratory), Phase II - Completed September 2006 Eduacation Floating Dock Development - Completed November 2006 Infrastucture SLTP Benete (New Class Building), Phase III - Completed February 2007 Eduacation TK Paving - Completed June 2007 SDN Paving - Completed July 2007 Beach Facilities - Completed December 2007 Recreation Beach Facilities - Completed September 2008 Recreation Junior Development Phase III - Completed December 2008 Eduacation

Clean Water treatment - Completed April 2009 Infrastucture

Bukit Damai ComDev Investments and Projects Include: Village Office - Completed August 2009 Infrastucture

Location Investment Inverstment Type Maluk (Maluk Loka/Mantun)

Road Investments:

Maluk Road Penetration Phase I - Completed October 1998 Access

Govt Road Improvement Maluk Hill Realignment (0.3 km) - Completed April 1999 Access

Sekongkang - Maluk Road Paving (7.877 km) - Completed January 2000 Access

Maluk-Benete Boundary Road Paving (3.17 km) - Completed February 2000 Access

Security Jobs Edge Road Sekongkang-Maluk I (Road Barrier)- Completed October 2000 Access Security Jobs Edge Road Sekongkang-Maluk II (Road Barrier) - Completed January 2001 Access Sekongkang-Maluk Govt. Road Cut Back - Completed February 2001* Access

Maluk-Sekongkang Brush Trimming - Completed February 2001 Access

Maluk-Sekongkang Road Maintenance ( 7.5 km) - Completed December 2003 Access

Road Improvement Between government Sekongkang Atlas- Maluk (8 km) - Completed April 2003 Access * - This improvement was noted during community Focus Group Discussions as being a a government funded project and not a PTNNT investment. Drainage Investments:

Main Govt. Road (3,150 m) - Completed October 1999 Drainage


Public Work Phase II (5,425 m) - Completed October 2001 Drainage

Public Work Phase III (3,603 m) - Completed June 2002 Drainage


Elementary School 02 / Rehabilitation SDN 02 - Completed February 1999 Eduacation

Police Station / Development Maluk police - Completed August 1999 Infrastucture

Old Police Station (police)- Completed April 2000 Infrastucture

Settlement Health Center - Completed May 2000 Public Health

Elementary School Renovation 01 - Completed June 2000 Eduacation

Temporary Landfill - Completed May 2001 Public Health

Water System - Drilling - Completed July 2001 Infrastucture

Water System - Road Access & Tank Pad Site Prep. - Completed July 2001 Infrastucture


Traditional Market - Completed June 2002 Infrastucture

Water System - Pipe Installation - Completed December 2002 Infrastucture


Water Recirculation - Completed August 2003 Infrastucture

Irrigation Feasibility Study, Phase I - Completed November 2004 Infrastucture

Maluk Beach, Phase I - Completed December 2004 Recreation

School Maintenance SD1 & SD2 - Completed June 2005 Eduacation

Puskesmas Maluk Maintenance - Completed September 2005 Public Health

Maluk Beach, Phase II - Completed September 2005 Recreation

Lab & Library Building SD02 - Completed October 2005 Eduacation

Landfill Interim Relocation - Completed November 2000 Public Health

Pasir Putih Investments in this area are presented in the summations for Mantun, Maluk Loka and Bukit Damai. Source: Community Development (ComDev) Project Data (PTNNT 2009b) and Focus Group Meetings (Appendix C).