Three Shot Dead Near Freeport’s Grasberg

A 29-year-old Australian who worked asanengineerat Freeport-Mc-MoRan Copper & Gold’s (FCX-N) Grasberg complex was shot dead Saturday while sitting in a car on his way to play golf, the Australian Broadcasting Corp. has reported.

The killing took place on the road near MP51, just outside the mining and operations area of Freeport’s massive copper-gold mine in Indonesia’s restive Papua province. Drew Grant, the father of a nine-week old infant, was reportedly shot four times in the neck and chest, according to news reports.

A day later, shots were fired at two security vehicles in the same area, killing a contract security officer who also worked at the mine and a police officer, as well as injuring five others.

In a separate incident, gunmen shot and injured two police officers in a different area near the mine site while they were searching for suspects in the murders.

Police and members of Indonesia’s anti-terrorism unit, Detachment 88, are investigating the killings, Freeport said in a statement emailed in response to questions from The Northern Miner.

Police believe the gunmen could have been part of the separatist Free Papua Movement or OPM, Reuters news agency reported. But armed local rebels have allegedly denied responsibility for the killing, according to the Associated Free Press. And ABC reports that the local commander of the Free Papua Movement, Kelly Kwalik, has denied any role in the killing.

Freeport officials declined to comment or speculate on who might be behind the attack. “This is a police matter under investigation and we are referring all questions regarding the investigation to them,” Bill Collier, vice-president communications at Freeport’s office in New Orleans, La., said.

Police have said military or police- issue weapons were used in the shootings, news agencies report.

“It could even have been rogue Indonesian security forces or someone who had access to that weaponry,” Matt Gertken, an analyst at global intelligence company Stratfor said in an interview.

The Indonesian government has maintained a high security presence in the region. The Grasberg mine is “a real massive draw of foreign investment and profit and that converts into tax revenues for the Indonesian government,” Gertken explains. “If the Grasberg facility is the number one taxpayer in Indonesia and generates a lot of revenue for the government, any government, no matter who is in charge, is going to try to keep a very, very strong grip on the situation there.”

Complicating the situation in Papua is the fact that a lot of military and police operating there are also involved in sideline businesses, Gertken notes, and soldiers and policemen have been known to get involved in local illicit activities. “There is a high-level of corruption, so that creates the framework for controversy between the different sides in addition to the inherent ethnic tensions.”

Indonesia is spread across some 17,500 islands. “Maintaining internal integrity has always been a rocky road to say the least,” Gertken says. “Indonesia has therefore put its security forces into these separatist regions that have popped up all over the place, especially after the fall of President Suharto in 1998; the strongman dictator who kept all the islands and over 300 ethnic groups under his thumb in a way that separatism wasn’t as much of an issue. After he fell you had these groups in Aceh and Papua getting out there and making their voices heard. Geopolitically, it’s a nightmare trying to keep the country intact.”

Contributing to local tension is that Freeport’s massive copper-gold mine represents inequality to many local Papuans who believe foreign investors are getting rich while they remain in poverty.

Freeport’s Grasberg mine is in the Indonesian territory of Papua, the western half of the island of New Guinea, not to be confused with the nation of Papua New Guinea, which is situated on the eastern half of the same island.

Papua encompasses the Indonesian provinces of West Irian Jaya and Papua. About half of the estimated 2.1 million inhabitants are indigenous Melanesian people (like those living in neighbouring Papua New Guinea) and distinct from the Malay people of Indonesia.

Separatist and ethnic tensions have simmered in Papua since the 1960s. The Dutch turned control over their former colony to the United Nations in 1962 and Indonesia assumed control in 1963. A referendum was never held on Indonesian control over Papua. Instead, a group of about 1,000 local officials assembled in 1969 and voted in favour of merging with Indonesia in what was called The Act of Free Choice.

Many Papuans believe the Act of Free Choice was a sham and claim delegates were hand-picked to vote in favour of Indonesian rule.

“Declassified documents released in July 2004 indicate that the United States supported Indonesia’s takeover of Papua in the lead-up to the 1969 Act of Free Choice, even as it was understood that such a move was likely unpopular with Papuans,” Bruce Vaughn, an analyst in Southeast Asian and South Asian affairs, wrote in a 2006 report for the Congressional Research Service.

“The documents reportedly indicate that the United States estimated that between 85 and 90 per cent of Papuans were opposed to Indonesian rule and that as a result, the Indonesians were incapable of winning an open referendum at the time. . . Such steps were evidently considered necessary to maintain the support of Suharto’s Indonesia during the Cold War. A similar view was taken towards East Timor.”

In May 2005, Papuan People’s Civil Rights Coalition protested the UN’s decision to give Indonesia administrative control over Papua and rejected the Act of Free Choice.

Since the 1990s, violence has mounted between Indonesian soldiers and pro-Papuan independence groups.

In 2002, two American teachers and an Indonesian companion who worked for Freeport were killed in an ambush near Timika, a city near the Freeport mine. The outcome of the investigation remains unclear.

In 2006, Anthonius Wamang, allegedly a commander of the Free Papua Movement, was sentenced to life in prison for the murders. But according to news agency AFP, “local human rights activists have accused the Indonesian military of orchestrating the violence in order to gain greater protection payments from the mining company.

Freeport owns 90.6% of the Grasberg mine through an Indonesian subsidiary and the Indonesian government owns the remaining 9%.

The mine has the world’s largest recoverable reserves of copper and the largest gold reserves, with 35.6 billion lbs. copper and 38.5 million oz. gold, according to Freeport’s annual report, released in 2008.

Last year, sales reached 1.1 billion lbs. copper and 1.2 million oz. gold at an average realized price of US$2.36 per lb. copper and US$861 per oz. gold. Freeport forecasts Indonesia sales of 1.3 billion lbs. copper and 2.1 million oz. gold for 2009.

Open-pit mining at Grasberg began in 1990 and is expected to continue until the middle of 2015, when underground operations are slated to begin.

At presstime in New York, Freeport was trading at US$48.78 per share.

The company has a 52-week trading range of US$15.70-$111.95 per share.