KPC finally makes share offer
Wednesday, July 31 2002 - 09:55 AM WIB
?KPC shareholders, BP and Rio Tinto had finally offered 51 percent stakes in KPC after East Kalimantan provincial government had submitted application to South Jakarta District Court to withdraw legal suits it had filed,? said Purnomo.
Lex Graefe, Rio Tinto Indonesia president director who is also a director in KPC confirmed Purnomo?s statement.
Purnomo said the 51 percent shares were offered on the basis price of US$ 822 million for all KPC shares.
Purnomo said that limited cabinet meeting had also decided that 31 percent of the shares would be allocated to East Kalimantan provincial government and East Kutai regency administration while central government would retain the remaining 20 percent. Purnomo said the 20 percent shares retained by central government would likely be given to state coal miner PT. Tambang Batubara Bukit Asam.
?All parties that are interested in buying KPC shares must undergo due diligence, especially to proof their financial capabilities,? said Purnomo.
He also said it would be up to East Kalimantan provincial government and East Kutai government to divide the 31 percent shares among themselves.
Under the coal contract of work, KPC which is currently equally owned by Rio Tinto and BP, must gradually offer at least 51 percent shares to Indonesian business entities 10 years after commercial production. KPC started commercial production in 1991.
East Kalimantan provincial administration and East Kutai regency where KPC mining is located had been insisting to be given exclusive right to purchase the whole 51 percent of the shares. But KPC insisted that all interested parties must have equal right to purchase its shares. East Kalimantan provincial and regency administrations are believed to be financially backed by several businessmen linked to Suharto regime.
East Kalimantan provincial administration had also filed lawsuits against KPC shareholders on the ground that it had suffered potential financial loss due to divestment delay. The lawsuits make it impossible for KPC to offer its shares to interested buyers.
Meanwhile, East Kalimantan provincial government said it would stick to its demand to be given right to buy the whole 51 percent of KPC shares.
?We totally disagree with the government?s decision to split KPC shares. We still want the whole 51 percent. We will not be responsible if anything bad happen to KPC,?? said Syaiful Teteng, a senior East Kalimantan provincial administration official.
An industry source told Petromindo.Com that David Salim, who is believed to be East Kalimantan provincial government financier, would likely not interested in buying KPC shares if he could not control the whole 51 percent.
?I think David Salim with his company PT. Intan Bumi Persada would likely drop its plan if it can not control the whole 51 percent,? said the source.? I think the same is also true with Prabowo with his company PT. Nusantara Energy,? said the source. Nusantara Eenergy is believed to be behind East Kutai regency administration.
KPC operates huge coal mining with annual capacity of more than 15 million tonnes in Sangatta, East Kutai.(alex/godang)