Govt, Newmont agree on copper, gold mine divestment price

The government and US gold miner Newmont Mining Corp. has reached agreement on valuation price of West Nusa Tenggara giant copper and gold miner PT. Newmont Nusa Tenggara (NNT), which is scheduled to divest 3 percent shares to Indonesian owned entity this year, a government official said on Friday

MS Marpaung, Director of Coal and Mineral at the Ministry of Energy and Mineral Resources, both government and Newmont had agreed on valuation of US$3.623 billion for NNT?s 100 percent shares.

?The government is still waiting for divestment offer from NNT,? he said. Meanwhile Noke Kiroyan, President of Newmont Pacific Nusantara, an Indonesian unit of Newmont Mining Corp. told Petromindo.Com Thursday that foreign shareholders of NNT had made formal offer to divest 3 percent of NNT?s shares to the government.

Under the CoW, foreign shareholders of NNT is obliged to gradually divest at least 51 percent of NNT?s shares to Indonesian government or Indonesian owned entities, starting with 15 percent 5 years after commercial operations (2005) and 8 percent the following year (2006). NNT is only obliged to divest 3 percent this year as local company PT. Pukuafu Indah (PI) has already controlled 20 percent of NNT?s shares. PI is controlled by Jusuf Merukh Family. The 51 percent divestment is expected to be completed in 2010.

Current foreign shareholders are Newmont Mining Corp (45 percent) and a consortium led by Japan?s Sumitomo (35 percent).

NNT?s Bata Hijau mine, which has ore reserves of 1 billion tons containing 0.525% copper and 0.37 gram per ton gold is producing around 600 million pounds of copper and 700,000 ounces of gold annually.(godang)