The Dairi zinc and lead mine project in Indonesia, a joint venture between China's state-owned China Nonferrous Metal Industry's Foreign Engineering and Construction Co. (NFC) and Bumi Resources Minerals, a subsidiary of Indonesian mining giant Bumi Resources, has met with fierce opposition from local residents who fear the project poses unacceptable risks to their lives and environment.

Located in a high-risk seismic zone and close to settlements, the proposed mine and its tailings dam, which would store millions of cubic metres of toxic waste, pose a significant threat to the surrounding communities and ecosystem. Studies have highlighted the risks of dam failure, acid mine drainage, flooding and untreated water contamination.

Local residents, supported by CSOs, have challenged the project's environmental approval and are protesting the Chinese government's funding. They argue that the EIA does not adequately address the risks and demand that safety and environmental concerns be prioritised over economic gains.

CASE FILE

Location: Indonesia – Dairi Regency, North Sumatra

Project: Zinc Mine

Companies: Dairi Prima Mineral, China Nonferrous Metal Industry’s Foreign Engineering and Construction Co. Ltd. and Bumi Resources Minerals

Key concerns:

1. High risk of a catastrophic tailings dam failure following earthquake or storm events
2. Human safety
3. Environmental damage
4. Population displacement
5. Lack of information, community consultation and consent

Community goals: Cancellation of the project because it does not meet international environmental and safety standards and was in a location where mining would create a disaster.

Key investors and financiers:

Previously, the Postal Savings Bank of China, the International Finance Corporation's financial intermediary, has provided a working capital loan to the mine's parent company, China Nonferrous Metal Mining Co Ltd (NFC). Those ties have now been broken.

Dairi Prima Mineral reported that it expected to raise 80% of the mine’s cost (approximately $366 million) through project loans. Carren Holdings Corporation Limited will provide a $245 million loan. Carren Holdings Corporation Limited is a company registered in Hong Kong, which is fully owned by the Chinese state-owned investment company CNIC Corporation Limited (國新國際投資有限公司), also registered in Hong Kong. CNIC Corporation is ultimately controlled by the Chinese state-owned investment holding company China Reform Holdings Corporation (中国国新控股有限责任公司)