MEMORANDUM TO MINISTER OF NATURAL RESOURCES AND ENVIRONMENT

MEMORANDUM TO

MINISTER OF NATURAL RESOURCES AND ENVIRONMENT

A THREAT TO THE RIGHT TO LIFE AND ENVIRONMENT

23 JUNE 2009

Bukit Koman Action Committee Against the Use of Cyanide in Mining of Gold

WE, the Bukit Koman Action Committee Against the Use of Cyanide in Mining of Gold (JawatanKuasa Bertindak Menentang Penggunaan Cyanide dalam Perlombongan Emas di Bukit Koman, hereinafter referred to as BKACAC) would like to bring to your attention the human health and environmental impacts already present at Bukit Koman, Raub due to the ongoing gold mining activities in close vicinity to our residential villages. The gold mining activities, conducted by Raub Australian Gold Mining Sdn. Bhd. (hereinafter referred to as RAGM) is reported to use substantial amounts of cyanide compound during the extraction process of gold from ore.

The operation of RAGM in Bukit Koman, especially by using cyanide, has raised serious concerns on human health, ecological integrity, socio-economic well-being and potable water security on both local and regional level. In summary, we would like to highlight four crucial areas of concern as follows:

1. Human health - The life and well-being of at least 3,000 residents of Bukit Koman living within a 2km vicinity to the RAGM mining premises are seriously threatened by the increasingly worsening air quality in the area. At least 300 villagers, including the elderly and children, have complained of suffering from different medical symptoms since the operation started in February 2009;

2. Ecological integrity - The integrity of surface water catchment and groundwater aquifer are seriously compromised. Detoxification of cyanide containing mine tailings and implementation of environmental monitoring plans, if carried out by RAGM, have not been made known to the public. However, the results of laboratory analysis of water samples collected by State Local Government, Environment and Health Committee on 25 May 2009 at the tailing pond detected 0.03mg/L cyanide, which is well above the Recommended Permissible level of below 0.2ppm (Part Per Million) held by the U.S. Environment Protection Agency. Presence of cyanide-like odour in the atmosphere was sustained and evident;

3. Socio-economic well-being – Socio-economical risks incurred by the local government of Raub and state government of Pahang are potentially high, uncertain and poorly documented. Productivity loss, medical costs and welfare loss of potential victims of cyanide poisoning pose potential huge burden on government and hence the taxpayers, but very limited details were publicly disclosed;

4. Water and national security - Potential release of cyanide compounds to the atmosphere, water and soil could impact the water quality in the future Kelau reservoir located within 30km to the RAGM Production Plant of Bukit Koman. The interconnected water bodies and topography suggest such a scenario should not be ruled out. When completed, the Kelau reservoir will supply water to over eight millions domestic and commercial users in the Klang Valley. It is a serious concern for both water and national security.

Background

In August 2006, RAGM successfully obtained approval from the State Mineral and Geoscience Department of Pahang to use cyanide in its carbon-in-leach (CIL) plant located at Bukit Koman, Raub. This approval was granted based upon the findings and conclusion of the preliminary Environmental Impact Assessment (PEIA) conducted by the RAGM in 1996. The state Department of Environment has approved the PEIA on 13 Jan 1997, with conditions. The EIA procedure is a legal provision under the Environmental Quality Act 1974 (Amendment) 1987, and any gold mining operation is subjected to EIA as prescribed under Environmental Quality (Prescribed Activities)(Environmental Impact Assessment) Order, 1987.

The ground breaking ceremony of the CIL plant was held on March 2, 2007. As of February 2009, RAGM commenced operation of its CIL plant and an estimated amount of 1,500 kg of cyanide was used daily. The management of RAGM, when queried repeatedly by BKACAC, has failed on several occasions to produce sufficient proof that the storage, disposal and treatment of cyanide compounds and wastes are in full compliance with established local and international standards.

Based on formal documents and informal sources of data gathered by BKACAC, there is reasonable belief that cyanide used in RAGM CIL facilities was not properly handled and that cyanide detoxification has NOT been done properly. These claims are made based on:

1. Repeated statement found in the Admission Document submitted to London Stock Exchange by Peninsular Gold Ltd (the parent company of RAGM) dated 17 June 2005, that cyanide detoxification MAY NOT be required for its operation in Malaysia particularly at the Bukit Koman site. To quote directly from the document, section 8.4.3.12 reads,

“…informed by Peninsular that cyanide destruction is not required by either the local authority, or the lender. Provision has been made in the capital cost for a detoxification plant, although its operating cost has not been included as it may not be required”.

(Imprima de Bussy, 2005)

2. Persistent and strong cyanide-like odour detected by the majority of Bukit Koman residents, since the RAUB CIL plant started operation in February 2009. More than 400 cases have been reported. Such odour has never been present in Bukit Koman in prior times. Various medical symptoms suffered by the residents after detecting the presence of such odour includes insomnia, vomiting, dizziness and skin rashes, with total number of reported cases exceeding 200.

3. Laboratory analytical results of water samples collected at May 25, 2009 by State Local Government, Environment and Health Committee and tested for total cyanide concentration. The results was 0.03mg/L which is well above normal background concentration in natural water bodies
4.

Furthermore, two internationally reputable environmental scientists, Dr. Mark Chernaik and Dr Glenn Miller, when engaged by BKACAC to provide their expert opinion have concluded that:

“the operation of the proposed gold mine tailings processing facility would impose an unreasonable risk to the health and safety or persons residing in Bukit Koman”,

and due to the lack of information

“residents of Bukit Koman can reasonably apprehend that their groundwater and surface water supplies would be contaminated by the migration of toxic substances from effluent in the standing pond”.

Dr Glenn Miller visited Bukit Koman during June 2008 and both of they sit on the Steering Committee of International Cyanide Management Code which is partly an United Nations initiative to establish guidelines for the mining industry.

Our Demand

With utmost respect, we would demand that your office take immediate action to address both the short and long term impact of the ongoing mining activities. Our demands are stated as follows:

1. To issue a stop work order immediately to all ongoing mining, extraction and processing activities at the RAGM premises located at Bukit Koman, Raub pending a comprehensive investigation conducted by an independent panel of experts. The stop work order is essential following numerous complaints by local residents and the failure of RAGM to respond promptly to queries on the presence of cyanide-like odour since RAGM started its CIL operation in February 2008;

2. To conduct an immediate and comprehensive health screening to all residents living within a 2km radius from the boundary of the RAGM CIL facilities and other residents suspected suffering from the symptoms of cyanide poisoning. Residents identified with compromised health conditions should receive medical treatment immediately;

3. To set up an expert panel whose responsibilities include but are not limited to:

1. Investigating the sources of reported strong cyanide-like odour detected in Bukit Koman village since February 2009

2. Assessing the validity of the claims by RAGM that its mining operation including the use and disposal of cyanide has been conducted in full compliance with all prescribed legislation of Malaysia and other applicable international guidelines.

Members of the expert panel should consist of appointees from all major stakeholders including the government, RAGM and the BKACAC to ensure the investigation process and findings are beyond partial view and doubtful conclusion. All findings and working progress updates are to be made accessible to the public at different stages of work; and

4. To revoke the approval granted to RAGM based on the PEIA submitted to DOE Pahang in 1996. The conditions in which the EIA approval was granted are likely breached by RAGM. Much evidence that has surfaced in recent months has sufficiently suggested that there are significant discrepancies between the actual ongoing mining operation and the proposed work described in the 1996 PEIA document. A new and detailed EIA process should be reinitiated.

Finally, we urge the government to consider a total ban on extensive use of Cyanide in all industrial activities including gold mining. We are of the opinion that when economic, social and environmental impacts of cyanide use are huge, detrimental and irreversible, then the precautionary principle should apply. As with every other citizen of Malaysia, it is our right to live healthily without the fear of cyanide poisoning. It is also our responsibility to leave an environment that is healthy and worth living in for our future generations of Bukit Koman, Raub, Pahang and Malaysia.