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Artisanal Mining

Artisanal and small-scale miners, many of whom operate illegally, have limited equipment and expertise at operating in hazardous conditions and can create social and environmental impacts, as well as placing their own health and safety at risk. We are attentive to concerns of stakeholders and minerals value chain participants regarding responsible sourcing of metals, with a focus on potential and actual human rights impacts associated with unregulated and illegal artisanal mining of minerals. We recognize that no single solution will entirely address this issue as long as there is cultural esteem associated with artisanal mining, along with unemployment, poverty and buyers for illegal products. However, we believe that a multi-pronged approach including security risk management, government cooperation, stakeholder engagement and socioeconomic development for alternative livelihoods is essential.

PT Freeport Indonesia PTFI uses controlled riverine tailings management to transport tailings and other sediments to a designated area in the lowlands and coastal zone, called the Modified Deposition Area (ModADA). Thousands of illegal artisanal miners pan for gold in the Otomona River system (downstream of the mill) within the project area. The artisanal miners include local community members, but the majority originate from outside the region.

A recent increase in the number of panner camps in the lowlands has presented challenges with levee maintenance and other earthworks associated with managing the engineered tailings deposition area. PTFI’s lowlands operations and community teams regularly coordinate to determine strategies for effective engagement with panners based on location and timing of operational plans. This coordination is important to help reduce the potential for pedestrian safety incidents. For example, dedicated pedestrian crossing areas have been installed along the east levee to allow for panners to safely walk from the deposition area to their settlements. This coordination has also helped address potential conflicts associated with illegal settlements and the footprint needed for maintenance of the lowland system.

The potential use of mercury by illegal gold panners is a concern. PTFI monitors regularly for mercury use via routine environmental monitoring programs, and mercury has not been detected above natural background levels in the estuary ecosystem. PTFI also maintains a continuous air mercury monitoring system in the town of Timika. Since 2010, mercury continues to be detected at elevated levels in parts of the town where gold shops are present. Due to these monitoring systems and educational outreach, PTFI believes the risk of mercury use in the river system has been significantly reduced. Community Liaison Officers are routinely in the field to socialize the health and safety risks of artisanal gold panning.

PTFI continued to work with a third party in 2015 to support stakeholder engagement efforts with illegal gold panners. This organization has conducted an update to the 2012 baseline survey on panning activity in both the highland and lowland areas. Given the sensitivity of illegal artisanal mining under Indonesian law and the associated risks, PTFI recognizes the importance of a neutral third party in helping to establish better information gathering and two-way communication.

In 2015, PTFI’s Government Relations Department led coordination on illegal panning with the local government (Provincial and Regency) and host-government security apparatus through a multistakeholder forum called Forum Komunikasi Bersama (FKB). This coordination started after the fatal security incident in Utikini Lama area in January 2015 (see incident description in our Voluntary Principles on Security and Human Rights 2015 Report to the Plenary on our website). FKB is tasked to address artisanal mining from the perspective of Indonesian regulation, safety and security and potential alternative livelihood programs for the panners. PTFI is also working with the local government and relevant institutions to find alternative livelihoods. For local community members, village-based economic development programs, including coffee and cocoa cooperatives, are current opportunities.

Tenke Fungurume Mining Artisanal mining is widespread throughout the mining regions of the DRC and is legal, except in private, industrial mining concessions such as TFM’s where the activity is illegal under DRC law. Illegal mining in the TFM concession remains a significant security risk – in part due to the high quality of ore, the proximity of the working areas to nearby populations and the lack of alternate economic activity. Some studies also indicate that, in many cases, illegal mining activities are culturally part of passage to manhood. In addition to our established security measures, we are addressing the issue through a combination of ongoing training on the Voluntary Principles, engagement with the local community security council and investment in economic development programs to promote long-term growth and alternative livelihoods in the community.

The greatest risks arising from illegal artisanal mining remain the safety and security of our employees, the local population and law enforcement officials. Artisanal miners do not use protective gear and either enter active TFM mine pits, stockpiles and waste dumps, or dig underground adits and tunnels to access ore deposits in non-active areas of the concession. Illegal miners typically enter mining areas in large clusters of approximately 200 to 300 individuals, and work in groups of approximately 15 to 20 individuals.

Working conditions in artisanal mining areas are treacherous, and the risk of landslides, collapse and the burial of miners are particularly high during the rainy season. In 2015, 10 illegal miners were killed in four incidents of tunnel collapses or geotechnical instabilities. TFM suspects that there could be more cases of illegal artisanal miner fatalities, but they are not reported to TFM or the local authorities due to the illegal nature of the activity and fear of arrest or closure of access to open deposits and tunnels. In active mining areas, the risks to illegal miners include injury or death from blasting, being struck by heavy equipment or buried in their tunnels during mine development and operations.

Illegal mining in the TFM concession is an outcome of social dynamics, notably high levels of population influx into the project area. New arrivals, mostly young men driven out of other artisanal mining or conflict areas, are drawn to southeast DRC by the possibility of economic opportunity and find their way into illegal mining when job opportunities do not materialize. High levels of influx and associated illegal mining create other risks and social conflicts in the community. Increased crime rates have been observed, and local populations have reported theft of crops, harassment of women, alcohol abuse, assault and the diversion of local waterways for ore washing activities.

TFM continued its partnership with nonprofit organization Search for Common Ground in 2015 to address conflict drivers in the local community, including illegal mining, through a communications and engagement program. Through this partnership, participatory theater was used to promote dialogue on issues related to illegal mining and targeted over 5,000 people with 20 performances in villages throughout the concession. These performances helped build understanding of the negative impacts of illegal mining on the community, such as increased violence, and encouraged community members to develop solutions to underlying issues, such as limited opportunities for youths.

The company continues to engage with the DRC authorities to operate control measures at the entry and exit points of the concession to interdict shipments of illegal ore, and to implement mobile security monitoring. TFM Community Liaison Officers conduct awareness campaigns to educate the community about the risks associated with artisanal mining activity. TFM’s long-term strategy continues to be support for economic development and job creation in the region to provide communities with other opportunities for income generation, though the effectiveness of these programs is constrained by high levels of population influx.



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