22 mining firms stop operation

Some 22 mining firms operating in Indonesia has stopped their operation due to low price of mining commodities and legal uncertainty in the country, according to Simon F. Sembiring, a director at the Ministry of Mines and Energy overseeing mining companies.

Simon pointed out that example of legal uncertainty in the country was the rampant illegal mining activities, and the dispute between PT Newmont Minahasa Raya and the local Minahasa administration in North Sulawesi.

But he said that the most significant factor was the lower international price of mining commodities which caused the stock price of mining firms to plunge, and created difficulties for the firms to raise the needed cash to finance their far flung mining operation.

Simon said that 19 companies were in their exploration stage, two in the investigation stage, and one in construction stage.

Gold mining firm PT Iriana Mineral, which plans to mine gold in Irian Jaya, is one of the companies in the exploration stage, while the company which was in the construction stage was PT Meres Soputan, which plans to explore gold potential in Sulawesi.(*)