East Kalimantan denies to have reached "win-win solution" in KPC divestment
Tuesday, June 11 2002 - 04:15 AM WIB
The governor also refuted the statement of the ministry?s spokesman Nurwinakun that the local administration and the central government had reach a "win-win solution" related to the dispute on the divestment of the coal producer?s 51 percent stake.
"There is no win-win solution. There was no agreement made during the recent meeting," he said as reported by Kompas daily on Tuesday.
He again stressed that the provincial administration would not drop the charge if the province?s legislative council did not ask to do so. "We just represent the people. If the legislators asked us to drop the case, then we would abide the request even today," he added.
According to the governor, the provincial administration maintains its previous demand that all of the 51 percent stake that would be divested by KPC shareholders must be sold to the East Kalimantan authority.
Meanwhile, the secretary of the East Kalimantan administration Syafran also denied the statement made by the secretary general of the Ministry of Energy and Mineral Resources Djoko Darmono that the bidding for the KPC divestment would be reopened during the period between July 1 and September 30, Kaltim Post reported.
Djoko had said that the KPC shares would be sold to the local provincial administration including regency administration, state owned companies and private firms.
KPC, which operates a large coal mining area in East Kalimantan, is equally owned by world mining giants Rio Tinto and BP. Under its contracts of works, the company?s shareholders are required to divest 51 percent of their shares to local investors.
However, the mandatory divestment program does not run as expected due to dispute with the East Kalimantan provincial administration, which recently filed a legal suit against the Ministry and Energy and Mineral Resources and existing shareholders for allegedly barring it from bidding the 51 percent share.(*)