East Kalimantan council complains to House about KPC divestment

The East Kalimantan provincial council complained to the House of Representatives on Friday that the ministry of energy and mineral resources was too slow in processing the divestment obligation of coal mining firm PT Kaltim Prima Coal.

The complaint was voiced by a delegation of the council and the provincial administration during a meeting with to the House's deputy speaker AM Fatwa.

The delegates included provincial secretary HS Sjafran, head of the commission C of the council Agust Tantomo, head of commission D Soehartono Sutjipto, head of commission B Abdul Hamid and members of commission D Agus Sukaca and Herlan Agussalim.

"The deadline for KPC to divest its shares was actually March 1, 2001. But, the ministry appeared to have delayed it," Herlan said during the meeting.

Under its contract, KPC, which is joint owned by Anglo-Australian mining giant Rio Tinto and British American energy firm Beyond Petroleum (BP), is obliged to sell up to 51 percent of its shares to the government or national companies after ten years of production. The company operates a huge coalmine in Sangatta, East Kalimantan.

However, the East Kalimantan provincial administration, which is interested to buy the shares, is still in disagreement with the company about the amount of shares to be divested by the company this year. East Kalimantan said the company has to sell 51 percent shares this year, but the company said its divestment obligation is less than 51 percent this year.

The councilors blamed Minsiter of Energy and Mineral Resources Purnomo Yusgiantoro for deliberately allowing KPC to delay the divestment of its shares.

They thus urged the House to question Purnomo over the matter.

The paper said that Fatwa telephoned Purnomo during the meeting, asking him to completely settle the matter. (*)