Indonesian court sentences foreign national behind 80-man illegal gold mining operation to 5 years’ jail, US$3.2 million fine

SINGAPORE: A foreigner who led an 80-man illegal gold mining operation in Indonesia’s West Kalimantan has been sentenced to five years’ jail and a 50 billion rupiah (US$3.2 million) fine for mining without a permit.

The Chinese national, identified only as YH by the Indonesian authorities, was arrested in May and will serve an additional six months in jail if he does not pay the fine, according to the Ministry of Energy and Mineral Resources.

Under Indonesian law, those convicted of mining without a permit may be jailed for up to five years and fined up to 100 billion rupiah.

News of illegal gold miners being convicted and sentenced in Indonesia is relatively rare compared to the number of reports on illegal mining accidents, the dangers of small-scale miners using mercury to extract gold, and some arrests made by the police.

According to the authorities, YH had 80 fellow Chinese nationals working for him in the illegal operation in Ketapang regency. Some of them did not have a visa to work in Indonesia.

He also sought help from local residents to provide housekeeping and catering services.

Investigators found evidence of gold ore mining activities at the site, which has a Mining Business Permit and is currently undergoing maintenance works, said Mr Sunindyo Suryo Herdadi, director of engineering and environment for minerals and coal at the Ministry of Energy and Mineral Resources.

The permit, however, belongs to two gold companies that do not have quota approvals for production from 2024 to 2026. Based on preliminary investigations, the two local companies do not have any connections with YH.

The state suffered an estimated loss of 1.02 trillion rupiah (US$65.6 million) as a result of the illegal operation, with the miners stealing 774.27 kg of gold and 937.7 kg of silver, news site Kompas.com reported.

The volume of gold ore excavated was about 2,687 m³, slightly more than the size of an Olympic-sized pool.

“The illegal underground mining (carried out by YH) involved blasting methods to process and extract the gold. After refining the gold underground, the bullion was then smuggled out of the tunnels and sold,” Mr Sunindyo said.

Sample tests showed the gold content was of high quality. Mercury – a substance hazardous to health but is used by many small-scale gold miners – was used to separate the gold from other minerals.