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Monday, 27 April 09
INDONESIA MINING RULES MAY DETER INVESTORS-OFFICIALS - REUTERS
Indonesia's rules on foreign divestment of mining projects must be revised to address issues such as finding buyers if Southeast Asia's biggest economy is to attract new investment in the sector, industry officials said.
The issue of divestment, whereby foreign investors are required to sell down their stakes in local units, has led to several disputes involving global players.
A local unit of Newmont Mining Corp (NEM.N) is currently involved in an arbitration case over share divestment. In 2003, Rio Tinto (RIO.AX) and BP (BP.L) were embroiled in a long legal battle over the sale of a stake in PT Kaltim Prima Coal (KPC)
A new mining law passed in December requires foreign investors to divest shares to either the government, state-owned enterprises, and/or a local private entity after the fifth year of commercial production.
The previous mining law, dating from 1967, did not include this requirement. However, some mining companies, including PT Newmont Nusa Tenggara (NNT), were required to divest some of their shares to the government and local investors according to the terms of their contract of works with the government.
"The main concern for investors is the divestiture process that KPC and Newmont experienced was bad, because the provision in the contract of works was not well drafted," said Bob Parsons, an independent mining consultant.
"The divestiture provision will discourage foreign investment because it's against international business practices," he added.
The new mining law promises more certainty for investors, but also includes some contentious issues, with contracts of work replaced by shorter-term mining permits.
Priyo Pribadi Soemarno, executive director of the Indonesian Mining Association, said the five-year divestiture period was too short.
"Mining is a long-term business and is financed through loans. They need time to reach break-even point, repay the loan before starting to sell their shares, and five years is not sufficient," Soemarno said.
"We are not against divestiture. But it should not make it difficult for foreign investors to do it."
The association warns that mining investment in Indonesia may drop below $1 billion this year, adding that there may be no fresh projects as metal prices fall and miners await details of the new mining bill including the divestiture provision.
The government is more upbeat, saying mining and geothermal investment could hit $2.24 billion, up from $1.6 billion in 2008.
GOING PUBLIC?
One of the main obstacles for a foreign investor is finding a buyer, as shown by Newmont's experience with its unit, NNT, which operates the Batu Hijau copper and gold mine in Sumbawa.
Under its contract of work, Newmont must sell 51 percent of its shares in the unit to local investors, with the finance ministry having first right of refusal on all the share sales.
The Indonesian authorities said Newmont had not sold its shares quickly enough, even though the finance ministry did not take up the offer to buy the shares because of limited funds and other spending priorities, leading to a dispute.
An arbitration court ruled earlier this month that Newmont must sell a 17 percent stake to the government within 180 days.
"It is easy for the law to mandate companies to sell their shares but when there is no buyer, what should they do?" said Parsons. "The regulations should anticipate various scenarios."
One solution, analysts suggest, is to allow foreign investors to list shares in the local venture on the stock exchange.
That strategy was used by PT International Nickel Indonesia Tbk -- in which Brazil's Vale Inco Ltd has a 60.8 percent stake -- when it sold a 20 percent stake in an initial public offering in 1990.
The government is now drafting the implementing regulations for the new law, including regulations on divestiture.
"We are discussing various options, including whether to release miners from the obligation to divest their shares if they cannot find buyers within a certain period," said an energy and mines ministry official, who asked not to be identified by name.
Source: http://uk.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUKJAK50340220090427?sp=true
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Sunday, 26 April 09
INDONESIAN GOVT SAYS COAL MINES CAUSE WEEKLONG FLOOD - THE JAKARTA POST
Samarinda administration in East Kalimantan admitted openly Thursday that the weeklong flood that paralyzed the city was caused by unruly management ...
Saturday, 25 April 09
FOREIGN SHARE DIVESTMENT STARTING THE 6TH YEAR OF PRODUCTION - MAJALAH TAMBANG
The government would set a divestment scheme for foreign miners, which would require companies to divest their ownership starting the 6th year of pr ...
Saturday, 25 April 09
INDO TAMBANGRAYA MEGAH ALLOCATED USD 126 MILLION FOR CAPITAL SPENDING - MAJALAH TAMBANG
Somyot Ruchirawat, President Director of PT Indo Tambangraya Megah, Tbk (ITMG), has announced the company's total dividend payment of Rp 1,345 per ...
Saturday, 25 April 09
MINING SECTOR IS STILL ON THE SURPLUS - THE JAKARTA POST
The global financial crisis is apparently also having an impact on the mining sector. People are thinking twice about investing in the mining sector ...
Saturday, 25 April 09
ADARO RUNS CATARACT OPERATION PROGRAM - THE JAKARTA POST
As part of its CSR program, thermal coal producer PT Adaro Indonesia has made cataract operations available to residents of Tandjung district, South ...
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- Billiton Holdings Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- Indo Tambangraya Megah - Indonesia
- Chettinad Cement Corporation Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Heidelberg Cement - Germany
- Deloitte Consulting - India
- Merrill Lynch Commodities Europe
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- Pendopo Energi Batubara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Krishnapatnam Port Company Ltd. - India
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Uttam Galva Steels Limited - India
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Global Coal Blending Company Limited - Australia
- Ministry of Finance - Indonesia
- Global Business Power Corporation, Philippines
- Gujarat Sidhee Cement - India
- South Luzon Thermal Energy Corporation
- TNB Fuel Sdn Bhd - Malaysia
- Minerals Council of Australia
- Jaiprakash Power Ventures ltd
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- PetroVietnam Power Coal Import and Supply Company
- Ambuja Cements Ltd - India
- Essar Steel Hazira Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Rio Tinto Coal - Australia
- New Zealand Coal & Carbon
- London Commodity Brokers - England
- GAC Shipping (India) Pvt Ltd
- Savvy Resources Ltd - HongKong
- Posco Energy - South Korea
- Cement Manufacturers Association - India
- Bukit Makmur.PT - Indonesia
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Mjunction Services Limited - India
- Ind-Barath Power Infra Limited - India
- Bhatia International Limited - India
- Parry Sugars Refinery, India
- SMG Consultants - Indonesia
- Makarim & Taira - Indonesia
- Malabar Cements Ltd - India
- Kobexindo Tractors - Indoneisa
- Jindal Steel & Power Ltd - India
- Indian Oil Corporation Limited
- Planning Commission, India
- Edison Trading Spa - Italy
- Ceylon Electricity Board - Sri Lanka
- OPG Power Generation Pvt Ltd - India
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Globalindo Alam Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- PowerSource Philippines DevCo
- PNOC Exploration Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Romanian Commodities Exchange
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- India Bulls Power Limited - India
- Tata Chemicals Ltd - India
- Meralco Power Generation, Philippines
- Orica Mining Services - Indonesia
- Bulk Trading Sa - Switzerland
- MS Steel International - UAE
- Power Finance Corporation Ltd., India
- Holcim Trading Pte Ltd - Singapore
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Kartika Selabumi Mining - Indonesia
- Siam City Cement PLC, Thailand
- Australian Commodity Traders Exchange
- Coalindo Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Sical Logistics Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Borneo Indobara - Indonesia
- PTC India Limited - India
- ASAPP Information Group - India
- Straits Asia Resources Limited - Singapore
- Central Java Power - Indonesia
- Indian Energy Exchange, India
- Bhushan Steel Limited - India
- Wood Mackenzie - Singapore
- ICICI Bank Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMC Global Power, Philippines
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Australian Coal Association
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Semirara Mining Corp, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parliament of New Zealand
- Baramulti Group, Indonesia
- Commonwealth Bank - Australia
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Medco Energi Mining Internasional
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Rashtriya Ispat Nigam Limited - India
- Indonesian Coal Mining Association
- IEA Clean Coal Centre - UK
- Carbofer General Trading SA - India
- Timah Investasi Mineral - Indoneisa
- Antam Resourcindo - Indonesia
- Dalmia Cement Bharat India
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Iligan Light & Power Inc, Philippines
- Vedanta Resources Plc - India
- Wilmar Investment Holdings
- GN Power Mariveles Coal Plant, Philippines
- Star Paper Mills Limited - India
- San Jose City I Power Corp, Philippines
- Altura Mining Limited, Indonesia
- Indika Energy - Indonesia
- Anglo American - United Kingdom
- Tamil Nadu electricity Board
- GMR Energy Limited - India
- Gujarat Electricity Regulatory Commission - India
- Goldman Sachs - Singapore
- Bukit Baiduri Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- CNBM International Corporation - China
- VISA Power Limited - India
- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Sojitz Corporation - Japan
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- Chamber of Mines of South Africa
- Banpu Public Company Limited - Thailand
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- Energy Link Ltd, New Zealand
- Bharathi Cement Corporation - India
- Marubeni Corporation - India
- Singapore Mercantile Exchange
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- Vizag Seaport Private Limited - India
- Madhucon Powers Ltd - India
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- LBH Netherlands Bv - Netherlands
- Latin American Coal - Colombia
- Electricity Generating Authority of Thailand
- Semirara Mining and Power Corporation, Philippines
- Bangladesh Power Developement Board
- White Energy Company Limited
- Grasim Industreis Ltd - India
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- Renaissance Capital - South Africa
- Karaikal Port Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Coal and Oil Company - UAE
- Africa Commodities Group - South Africa
- The University of Queensland
- Samtan Co., Ltd - South Korea
- IHS Mccloskey Coal Group - USA
- Maharashtra Electricity Regulatory Commission - India
- Videocon Industries ltd - India
- Thai Mozambique Logistica
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Central Electricity Authority - India
- Indogreen Group - Indonesia
- Sakthi Sugars Limited - India
- Riau Bara Harum - Indonesia
- Mercuria Energy - Indonesia
- Standard Chartered Bank - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Economic Council, Georgia
- Attock Cement Pakistan Limited
- Maheswari Brothers Coal Limited - India
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