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Mr. Clean: A Gold Mining Exec Battles Pollution Charges in Indonesia

Rick Ness is spending a million a month to convince the world he's innocent of contaminating pristine waterways. Once you meet him, you'll want to believe him.

| Mon Sep. 10, 2007 12:00 AM PDT

Rick Ness doesn't have a moment to spare. As we rip through the blue equatorial water, he is oblivious to the engine's roar, the hot, salty wind, the stomach-turning chop. "While we have the time," he hollers, ruddy strands of hair flying about like palm fronds in a typhoon, "why not ask Jerry here about the month he spent in a Jakarta jail?"

Jerry Kojansow doesn't need much prompting. "We were scared," the 36-year-old marine biologist shouts. Violent criminals and suspected terrorists packed the cells. "The guards played tricks with our heads," he recalls; at one point they locked him in a room that slowly filled with smoke. "We realized they can do anything to us."

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No matter how many times Ness has heard it, he seems rapt by the testimonial, which encapsulates his own looming nightmare. While medical issues helped Ness stay out of the slammer when Kojansow and five other Newmont Mining employees were locked up in 2004, he now faces charges that could result in a 10-year sentence. A government prosecutor claims that as president of Newmont Minahasa Raya, an Indonesian subsidiary of the Denver-based gold-mining giant, he was responsible for polluting a pristine bay with millions of tons of mine waste that some have blamed for a rash of deaths and illnesses.

But if bringing criminal charges against a powerful American was a bold step for Indonesia, Ness responded with equal nerve. Since 2004, he has waged a full-time PR and legal campaign to clear his name, with Newmont backing him up at a burn rate of up to $1 million a month. Other U.S. executives have joined in, as has the Bush administration. Together, their arguments have amounted to a blunt message to Indonesia and other developing nations: Send expat executives to jail, and expect foreign investment to evaporate.

Paradoxically, perhaps the most effective argument for the exonerate-Rick-Ness campaign is Ness himself. An affable, 57-year-old Midwesterner, he's tried hard to assimilate here, converting to Islam, marrying an Indonesian woman, and paying to send hundreds of poor children to school. He commands enormous sympathy from almost everyone he knows, including many reporters who have covered his story, resulting in a slew of friendly articles in the world press. He has a 25-year history with controversial mines; before Newmont, he worked at Freeport McMoRan's operation in Papua, notorious for its environmental devastation and its collaboration with a brutal military. Yet he insists, with genuine conviction, that no abuses have ever taken place under his watch. I've come along on this private tour of the alleged crime scene—Buyat Bay, a cove notched into Sulawesi, the world's 11th largest island—to try to reconcile the two faces of Rick Ness. And it's a testament to the man's persuasive charm that I've actually agreed to go diving here, right next to Newmont's underwater waste heap.

Tall and pale pink, with a slight paunch, Ness has blue eyes creased into a permanent squint. Normally a jeans-and-oxford-cloth man, on this excursion he wears black loafers, pressed gray chinos, and a light-blue button-down shirt. He holds forth with the enthusiasm of a Fuller Brush salesman, tempered by an undertow of fear and exhaustion. "Why, the whole thing is an elaborate hoax!" he exclaims. "There was no pollution and nobody got sick. It's as simple as that." Over and over, he insists that both he and Newmont are victims of Indonesian politics. "Sometimes," he tells me at one point, breaking into tears, "I don't know if we're the football or the goalpost."

Newmont doesn't deny piping 5 million tons of heavy-metal-laden mine waste into Buyat Bay. "But it was as clean as sand," Ness insists; the only impact "was smothering seafloor worms." He claims people familiar with the facts see things his way. "The local government has been promoting the bay as the next undiscovered dive spot. Now why in the world would they do that if it was polluted?" He smiles, revealing a row of tobacco-stained teeth and a single gold incisor.

in 1994, newmont mining—then a midsize Nevada gold producer striving to become a global leader—broke ground in the mountains above Buyat Bay. Over the mine's eight years in operation, the company extracted $672 million worth of gold from its $200 million investment. Locals, too, hoped for a payoff. In a place where zinc-roofed huts cram every inhabitable flatland, where most survive on what fishermen in flimsy outriggers can haul from the sea, jobs paying a few dollars a day seemed a godsend.

To dispose of its waste, Newmont built a pipe that channeled the waste to the bottom of Buyat Bay; it assured residents that the fish would be fine. But just months after the mine opened, villagers began complaining that schools of silvery carcasses were washing up on the beach, putrid and stiff. On the fish they caught, the men found strange tumors that oozed an oily black goop under their fillet knives. Villagers took the dead fish to the local university (one of many beneficiaries of Newmont's largesse), which refused to test them. At one point, the pipe burst, spewing waste into shallow water. Villagers protested, occupying Newmont's office for several hours. The mine's community outreach workers—smart men with college educations—told the villagers the fish were safe, and so they ate them.

For a while, Indonesia's U.S.-backed strongman, Suharto, kept a lid on the controversy. But things got tougher for Newmont after Suharto was toppled in 1998. The newly empowered environment ministry demanded that the company abide by hazardous-waste regulations and produce an environmental risk assessment. Neither mandate was fulfilled to regulators' satisfaction, but with the country reeling from the Asian financial crisis, the government was not inclined to push the matter.

On these key events, accounts from intellectuals, the Indonesian government, and news stories largely dovetailed. But in his Jakarta high-rise office, Ness told me a markedly different story. He said the mine ran smoothly and the villagers never complained about pollution or their health. He blamed the protests on outside activists. Fish kills in the bay, he said, were caused by locals dousing the reefs with cyanide to speed up their harvest—a common tactic in Indonesia. In short, he says, no one except "antimining, antiglobalization groups" had a gripe with Newmont—until 2004.

In July of that year, a five-month-old girl named Andini died in the quiet fishing village of Buyat Beach. From birth, she had been small and sickly, with a grotesque scaly rash covering her body. Photos circulated of the baby in her last days—tiny, chafed, and seemingly writhing in pain—and Indonesian reporters swarmed Buyat Beach, broadcasting footage of residents with tumors, debilitating cramps, and severe headaches. Lab tests showed mercury levels in some villagers' bodies that were triple the level the U.S. government considers safe, and police investigators found mercury and arsenic in the bay. (Newmont's own analysis of the same water samples found them to be clean.)

Ness tirelessly defended his company, claiming the residents suffered from hygiene-related ailments common in remote villages, and he produced doctors willing to vouch for this. But in a nation rife with distrust of multinationals in general, and Americans in particular, his denials mattered little. Ness' name became iconic in the manner of Ken Lay's. When we traveled to Buyat last year, he was in the midst of defending himself in a 21-month trial focusing on pollution charges. (The indictment skirted the question of health effects, and Newmont has always maintained that there are none.) On April 24, 2007, the day of Newmont's annual shareholder meeting and a week after the company offered to sell $325 million in shares to the Indonesian government, the provincial court acquitted Ness of all charges. "I was amazed at how thoroughly the judges sided with us," Ness says. "It was a slam dunk." But in June, the Indonesian prosecutor appealed the case to the country's Supreme Court, and Ness prepared to do battle again.

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