E. Kalimantan court postpones Kideco's hearing

The Samarinda district court in East Kalimantan has postponed to June 19 its hearing for lawyers of East Kalimantan-based coal producer Kideco Jaya Agung to present their defense argument against the provincial administration that had demanded the company to offer it its shares, one of the lawyers told Petromindo.Com Friday.

The initial plan was that the court would hold the hearing Friday (today).

?We shall present our exception against the provincial administration on June 19. The court will receive evidences produced by the two warring parties on the occasion,? said Kideco?s lawyer Fredrik J. Pinakunary from Jakarta-based Lubis, Santosa and Maulana law firm.

In April, the East Kalimantan provincial administration and Pasir regency administration filed a lawsuit against Kideco arguing that the company had failed to offer its shares to the province. Kideco operates a huge coalmine in Pasir, which is part of East Kalimantan.

The province demanded Kideco to pay it compensation in excess of US$300 million, and insisted that the 10 percent stake Kideco had already sold to two Indonesian parties be annulled.

Their lawsuit prompted the central government to delay the divestment process.

Before the divestment delay, Kideco was in the process of fulfilling its contractual obligations of divesting 51 percent of its shares to Indonesian investors. In 2001, the company offered 34 percent of its shares, but only 10 percent was sold to two Indonesian companies. Last year, it offered another 34 percent, and last month it was supposed to complete the 51 percent divestment by offering another seven percent.

Kideco, one of Indonesia?s top coal producers, is a subsidiary of South Korean company Sam Tan Corp. (godang)