Govt says KPC has to divest 51 percent shares this year
Thursday, April 5 2001 - 04:30 AM WIB
The government has decided that coal-mining company PT Kaltim Prima Coal (KPC) has to divest 51 percent of its shares this year, Minister of Energy and Mineral Resources Purnomo Yusgiantoro said on Thursday.
"We are going to reveal our (the government's) position. Based on our calculation, (KPC has to divest) 51 percent this year," Purnomo told Petromindo.Com Thursday morning prior to a meeting of the ministry's top officials at the ministry.
Director general of geology and mineral resources Wimpy S. Tjetjep said prior to the meeting that the ministry had sent a letter to KPC informing the company of the government's decision.
"It is the final decision. Let's see how (KPC will respond to the decision). But I think KPC will accept it," Wimpy said.
Wimpy said Anglo-American energy giant Beyond Petroleum (BP), which owns 50 percent of KPC, could accept the decision, but Anglo Australian mining giant Rio Tinto, which holds the remaining 50 percent shares, was still opposed to it.
Earlier, BP Indonesia's vice president for public and government affairs Satya W. Yudha told Petromindo that the government and KPC's shareholders will meet on Monday to make a final decision on the matter, "which will satisfy all parties".
It remains unclear if there will be a meeting next Monday on the matter.
Under the contract, KPC, which operates a huge coal mining in Sangatta, East Kalimantan, is obliged to sell up to 51 percent of its shares to the Indonesian government, state companies or private companies controlled by Indonesians after ten years of production.
But, KPC as well as the East Kalimantan provincial administration, which is interested in buying the shares, have been for more than one year involved in dispute over the amount of shares to be divested by the company.
East Kalimantan demanded last year the company sell 51 percent of its shares, but the company said it was required to divest only 37 percent shares that year.
KPC is Indonesia's second largest coal producer with an output of 14 million tons in 2000. (Godang)