This method of "submarine tailings disposal" is effectively banned in most developed countries because of the damage the metal-heavy waste can do to the ocean environment, and Newmont practices it nowhere but in Indonesia. Four years ago an Indonesian court brought criminal charges against a Newmont subsidiary—even jailing five of its employees for a month—for pumping pollutants into the sea near its now defunct Buyat Bay mine on the island of Sulawesi. Newmont was acquitted of all charges in 2007. Despite critics' claims that the court caved in to the mining industry, Newmont defends its reliance on ocean dumping at Batu Hijau. "Land disposal would be cheaper but more damaging to the environment," argues Rachmat Makkasau, Batu Hijau's senior process manager. The tailings at Batu Hijau are released 2.1 miles offshore at a depth of 400 feet, above a steep drop-off that carries the waste down more than 10,000 feet. "We closely monitor the quality of the tailings, pipes, and seabed," says Makkasau. "At that depth, we are only affecting some 'sea insects.' "

The deep sea may not have many defenders, but the rain forest does. And that may be one reason Batu Hijau's mountains of waste rock, rather than its submarine tailings, are fueling a conflict with the Indonesian government. Newmont's environmental depart­ment—now 87 strong—stresses its efforts to reclaim the heaps of discarded rock, covering them with ten feet of soil and letting the jungle take root. Nothing can restore the pristine rain forest, of course, and Newmont faces a further problem: After ten years of operations, it is running out of room to dump the waste from Batu Hijau. Three years ago, the company applied to renew a permit to clear another 79 acres of rain forest. So far, Jakarta has not granted it, as environmentalists point to the near disap­pearance of the yellow-crested cockatoo on Sumbawa. With limited space, Batu Hijau's haul trucks are now getting caught in traffic, hurting the mine's effi­ciency. If more rain forest is not granted soon, Newmont officials have warned, they will be compelled to lay off several hundred Indonesian workers.

The imbroglio lays bare a surprising rift between Newmont and its once friendly Indo­nesian hosts. Batu Hijau was supposed to be a model mine, and Newmont likes to tout its benefits: the $391 million in local royalties and taxes it paid in 2007, the more than 8,000 jobs it has created for Indonesians, the reported $600 million spent to minimize environmental damage. Then there's the more than $3 million Newmont spends each year on community development. It may be a pittance compared with the company's annual revenues, but it has provided the five villages closest to the mine with electricity, health clinics, irrigation dams, and agriculture projects.