Australian miner halts work after protest deaths

An Australian mining company has halted its activities in Indonesia, after three protesters were killed by police during a demonstration.

Arc Exploration has advised its shareholders via an announcement to the Stock Exchange that it has halted its gold exploration work on the island of Sumbawa, east of Bali.

On Saturday riot police shot the anti-mining protesters in the port town of Sape, an incident which the police force now says was an overreaction.

Arc has been locked in a long dispute with anti-mining activists and local farmers, who were calling on the government to revoke its large exploration lease when the riot police moved in on the weekend.

The statement from Arc Exploration says that while it remains in full compliance with all legal, regulatory and licence requirements, the company has halted exploration activities at the Bima project until the situation is resolved.

It adds that in conjunction with local government, the company has conducted extensive consultation concerning its activities.

It says it recently had received positive responses from the local communities and authorities.

There has been no suggestion that the company was involved in the violence.

Earlier, the Indonesian Human Rights Commission said the company's work should be suspended after the shootings.

"This is a very serious violation of human rights because the police shot directly at the protesters. Three people died, young people," the Commission's chairman Ifdhal Kasim said.

Arc Exploration's last declaration to the ASX, just four weeks ago, had struck a much more rosy tone.

It said that after civil disturbances were reported in February, it held "meetings with local people, community leaders and government authorities to secure their long term support".

The company noted that ongoing disturbances could lead to further delays, but said it was "pleased that the extensive consultation process with local community leaders and authorities ... resulted in these parties confirming their support for [the company's] activities".

Mr Kasim says the recent deaths have shown those assurances were ill-founded.

"I think this not true because in fact many people in this area, people in three districts, still oppose this corporation's operation in this area," he said.

Few people know of the strong Australian stake in the operation in Sumbawa.

There has been no evidence of ties between Arc Exploration and the local authorities, but in Indonesian newspapers and on TV, the police are being likened to corporate enforcers.

The Human Rights Commission says it is common in Indonesia for resource companies to provide incentives like cash payments, housing, food and transport to police to secure their area of operations.

Its investigation will also probe to see if the police were encouraged in any way to take sides.

The Greens say Department of Foreign Affairs should investigate the deaths of the protesters.

But a spokeswoman for the acting Foreign Affairs Minister Martin Ferguson says the issue is primarily the responsibility of the Indonesian authorities.