C. Kalimantan weighs up majority stake in IndoMet Coal

The Murung Raya district administration in Central Kalimantan will consider buying a majority stake in IndoMet Coal, a joint-venture between Broken Hill Proprietary Biliton and IDX-listed coal firm PT Adaro Energy Tbk, a senior official said on Thursday as reported by thejakartaglobe.com.

BHP Biliton will sell 75 percent of its coal shares of IndoMet Coal to other local companies, amid uncertainty of Indonesian regulations and a weak outlook for coal. Adaro holds the remaining 25 percent stake in IndoMet.

?The regional government intended to buy it if the BHP Biliton will release all of its stakes at IndoMet Coal,? said Perdie M. Yoseph, Murung Raya district head.

Perdie referred to a 2009 mineral and coal mining law that stipulates local government must be prioritized over private entities in cases of divestment of rights to mineral resources management and production.

Currently, IndoMet Coal holds seven coal mining licenses (PKP2B) in Murung Raya district, which are held by seven operating subsidiaries Lahai Coal, Ratah Coal, Joloi Coal, Pari Coal, Sumber Barito Coal, Kalteng Coal and Maruwei Coal. The mines cover a total area of 265,947 hectares and contain 1.2 billion metric tons of resources, making it one the largest coal reserves in the world.

IMC had been conducting explorations since 1997 and began production in September through the Lahai Coal company.

?We expected BHP Biliton should be more transparent to stakeholders over the divestment plan so it can be known to the public, while also sustaining a positive impact on local and national communities,? Perdie said. (*)