E. Kalimantan bid to buy KPC shares studied: official
Monday, May 1 2000 - 08:30 AM WIB
The government will examine the source of funds to be used by the East Kalimantan provincial administration in acquiring shares of mining company PT Kaltim Prima Coal, the Jakarta Post reported.
The paper quoted the Ministry of Mines and Energy's secretary general Djoko Darmono as saying it was yet unclear how the provincial administration would fund its acquisition plan.
"We still don't know whether foreign or domestic investors behind the funding," he said.
He noted that under the contract of work awarded by the government to KPC, the provincial administration was not allowed to form partnerships with foreign investors to acquire KPC's shares.
Under the contract, KPC must gradually divest its shares up to 51 percent between fifth and the 10th year of commercial production, which started in 1992. This year it must divest 37 percent.
KPC, a joint venture between Anglo-Australian mining firm Rio Tinto and British Petroleum-Amoco PLC., must divest its shares to the government, Indonesian owned companies or Indonesian citizens.(*)