On 28 May 2006, an industrial gas drilling company initated a torrential hot volcanic mudflow which would inundate villages and rice paddies, displacing more than 11,000 people from eight villages in the Porong district, Sidoardjo.
Families and factories as well as farms had to be relocated as the land was deem unsafe. Since then, there were more gas explosions, hot muds exploding as far as 5km unexpectedly. According to the geologists the mud volcano was collasping in its own weight
Two years on my June 2008 travels, when we visited the place briefly, there were some industrial work going on, probably related to the gas exploration works since the gas pipelines were still in operations.
As far as my eyes could see, the ruined villages were still covered by the mud, nothing has yet to be done to the area. Some people were still living in tents and have turned to begging in the streets.
The price of living next to an active volcano, the volcano exploded into a large caldera of hot mud
Many houses in the villages were destroyed by the mud and gas explosions. Two years on, nothing has been done
There were quite a few people in the streets asking for money, some still lived in makeshift tents
The active caldera still releasing hot vapour gaseous.
Hot mud and water flows, some works are still being done to divert the hot mud safely
I found a national geographic article which would give you more details of the whole situation. You can read it here.