East Kalimantan deal with PT Intan over KPC acquisition not yet final: legislator
Monday, August 6 2001 - 01:57 AM WIB
Ridwan Suwidi, head of the United Development Party faction at the council, said that according to existing law, the provincial administration must seek the approval of the council in any business deal with the private sector.
Ridwan said that although the speaker of the provincial council Sukardi Djarwo Putro had jointly signed the MoU with the provincial governor over the appointment of PT Intan, the council had yet to hold a plenary session to decide on the deal.
?So there?s still possibility that the partner (of the East Kalimantan administration in the acquisition of KPC) changes,? he told the local Radar Kaltim daily.
He said that the important thing for the council was to ensure that the province get the best private partner.
He said that if no other investors could match the offer made by Intan, the legislative council would approve the MoU.
The East Kalimantan government plans to acquire a 51 percent stake in KPC. The government has appointed PT Intan to fully finance the acquisition deal, under which the local administration would end up with a 5 percent stake in KPC.
But there has been protest recently over the lack of transparency in the appointment of PT Intan, which some said was linked to very influential people in Jakarta and the province.
KPC is obliged to divest up to 51 percent shares immediately this year. But there has been accusation from East Kalimantan that KPC was trying to delay the divestment obligation.
The ministry of mineral resources and energy has invited Rio Tinto and BP, both the shareholders of KPC, to meet next week with the East Kalimantan authorities to negotiate for the share price, the remaining unresolved issue surrounding the KPC share divestment program.(*)