All mining contracts will be reviewed: VP

Vice President Jusuf Kalla said that the government will review all the contracts of work which it signed with mining and oil & gas companies. The review, whose main objective is to see that the state will not suffer any losses, will focus on the conditions that must be fulfilled by the mining companies, the Kompas newspaper reported in its Saturday edition.

The contract to operate Cepu oil and gas block is one of the contracts that fulfilled all the conditions properly. As per the contract, state oil and gas firm PT Pertamina and foreign company ExxonMobil will jointly operate the Cepu block.

This was disclosed by Kalla to reporters after the Friday prayers at the Vice Presidential Palace.

The press asked him about how far the government will follow up the contract between the government and ExxonMobil on the Natuna island, given the fact that the contract was already expired and moreover, the state will not get any royalty.

?In the case of Natuna, we are still studying it. And in all other contracts, we will also study them to see whether they (companies) fulfill all the existing conditions or not?? Kalla said.

While referring to the Freeport, Kalla said that the government has already set up an interdepartmental team to study whether Freeport fulfilled all the conditions mentioned in the contract.

Whether it is tax, or the gold which it exporting is in line with it (contract), and how much percentage of gold in the ore and other things? The team will decide,? Kalla said.

Though Kalla referred the Cepu contract as the best one, several groups criticized the joint operation by Pertamina and ExxonMobil of Cepu block. According to them, the government should have given the contract to Pertamina instead of ExxonMobil. Under the present situation the government will suffer huge losses. (*)