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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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- Chamber of Mines of South Africa
- TeaM Sual Corporation - Philippines
- Anglo American - United Kingdom
- Ministry of Transport, Egypt
- Iligan Light & Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- Meralco Power Generation, Philippines
- Mercator Lines Limited - India
- Sree Jayajothi Cements Limited - India
- Rashtriya Ispat Nigam Limited - India
- Meenaskhi Energy Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Standard Chartered Bank - UAE
- Global Green Power PLC Corporation, Philippines
- Interocean Group of Companies - India
- Borneo Indobara - Indonesia
- Chettinad Cement Corporation Ltd - India
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Merrill Lynch Commodities Europe
- Asmin Koalindo Tuhup - Indonesia
- Jaiprakash Power Ventures ltd
- Sical Logistics Limited - India
- Medco Energi Mining Internasional
- Orica Mining Services - Indonesia
- Coastal Gujarat Power Limited - India
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Indogreen Group - Indonesia
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Indonesian Coal Mining Association
- CNBM International Corporation - China
- Attock Cement Pakistan Limited
- Parry Sugars Refinery, India
- Uttam Galva Steels Limited - India
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- Riau Bara Harum - Indonesia
- Posco Energy - South Korea
- Krishnapatnam Port Company Ltd. - India
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Banpu Public Company Limited - Thailand
- Electricity Generating Authority of Thailand
- Vedanta Resources Plc - India
- Karaikal Port Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Eastern Energy - Thailand
- Manunggal Multi Energi - Indonesia
- Minerals Council of Australia
- Mjunction Services Limited - India
- Wilmar Investment Holdings
- Dalmia Cement Bharat India
- Larsen & Toubro Limited - India
- Edison Trading Spa - Italy
- Oldendorff Carriers - Singapore
- Kartika Selabumi Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- Economic Council, Georgia
- Indian Oil Corporation Limited
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- Eastern Coal Council - USA
- Lanco Infratech Ltd - India
- Maheswari Brothers Coal Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Deloitte Consulting - India
- VISA Power Limited - India
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- International Coal Ventures Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- PTC India Limited - India
- Sarangani Energy Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Central Electricity Authority - India
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- LBH Netherlands Bv - Netherlands
- Heidelberg Cement - Germany
- Savvy Resources Ltd - HongKong
- Ceylon Electricity Board - Sri Lanka
- GMR Energy Limited - India
- SN Aboitiz Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Georgia Ports Authority, United States
- Essar Steel Hazira Ltd - India
- Straits Asia Resources Limited - Singapore
- Binh Thuan Hamico - Vietnam
- South Luzon Thermal Energy Corporation
- Kohat Cement Company Ltd. - Pakistan
- Sindya Power Generating Company Private Ltd
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Trasteel International SA, Italy
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- Siam City Cement - Thailand
- Aditya Birla Group - India
- Directorate General of MIneral and Coal - Indonesia
- Baramulti Group, Indonesia
- Timah Investasi Mineral - Indoneisa
- Commonwealth Bank - Australia
- Africa Commodities Group - South Africa
- IHS Mccloskey Coal Group - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Neyveli Lignite Corporation Ltd, - India
- IEA Clean Coal Centre - UK
- Intertek Mineral Services - Indonesia
- Global Business Power Corporation, Philippines
- Xindia Steels Limited - India
- Billiton Holdings Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Electricity Authority, New Zealand
- Latin American Coal - Colombia
- Videocon Industries ltd - India
- Carbofer General Trading SA - India
- Maharashtra Electricity Regulatory Commission - India
- The Treasury - Australian Government
- Ministry of Mines - Canada
- SMG Consultants - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Romanian Commodities Exchange
- Orica Australia Pty. Ltd.
- Toyota Tsusho Corporation, Japan
- Independent Power Producers Association of India
- GN Power Mariveles Coal Plant, Philippines
- San Jose City I Power Corp, Philippines
- Jindal Steel & Power Ltd - India
- The University of Queensland
- Bharathi Cement Corporation - India
- Coal and Oil Company - UAE
- SMC Global Power, Philippines
- CIMB Investment Bank - Malaysia
- Ind-Barath Power Infra Limited - India
- Sinarmas Energy and Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Wood Mackenzie - Singapore
- Samtan Co., Ltd - South Korea
- Salva Resources Pvt Ltd - India
- Star Paper Mills Limited - India
- Madhucon Powers Ltd - India
- GVK Power & Infra Limited - India
- Australian Commodity Traders Exchange
- Renaissance Capital - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Siam City Cement PLC, Thailand
- Planning Commission, India
- Bangladesh Power Developement Board
- Jorong Barutama Greston.PT - Indonesia
- MS Steel International - UAE
- Gujarat Sidhee Cement - India
- Goldman Sachs - Singapore
- McConnell Dowell - Australia
- Karbindo Abesyapradhi - Indoneisa
- Indian Energy Exchange, India
- Rio Tinto Coal - Australia
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Mercuria Energy - Indonesia
- London Commodity Brokers - England
- PNOC Exploration Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Cement Manufacturers Association - India
- Antam Resourcindo - Indonesia
- Marubeni Corporation - India
- Malabar Cements Ltd - India
- White Energy Company Limited
- ASAPP Information Group - India
- Bulk Trading Sa - Switzerland
- Bhatia International Limited - India
- Price Waterhouse Coopers - Russia
- Thiess Contractors Indonesia
- Kepco SPC Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Formosa Plastics Group - Taiwan
- Grasim Industreis Ltd - India
- Semirara Mining Corp, Philippines
- Ministry of Finance - Indonesia
- Thai Mozambique Logistica
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Central Java Power - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Makarim & Taira - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
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