Minister signs five mining contracts
Wednesday, September 6 2000 - 05:30 AM WIB
Minister of Energy and Mineral Resources Purnomo Yusgiantoro signed on Wednesday three contracts for the development of the country's coal resources and two renewed contracts for the development of the country's tin and granite resources.
"The signing of these contracts confirms that Indonesia is still an attractive country for investment particularly in the coal sector, even though we are currently in transition period as we go through a process of political reform and economic restructuring," Purnomo said in his speech during the signing ceremony.
The minister awards contracts to PT Juloi Coal, PT Ratah Coal, PT Lahai Coal and renewed the contracts of tin mining company PT Koba Tin and granite mining company PT Granite Karimun.
Director of mining venture supervision Simon Sembiring who is one of the ministry's chief negotiator for the contracts, said in his speech during the ceremony that Juloi, Ratah and Lahai were all 99 percent owned by an Australian firm BHP Minerals Holding Pty with the remaining 1 percent share owned by its sister company BHP Minerals Asia Pacific Pty. Ltd.
Koba Tin is 75% owned by Australian firm Kajuara Mining Co. Pty. Ltd in partnership with state tin mining company PT Timah, which holds 25% shares.
Granite Karimun is owned by a consortium comprising HongKong's firm Seville Row Developments Ltd (2.5 percent), Hong Kong's firm Eastern Fortune ltd (2.5 percent), local firms PT Pendawa Sempurna (77.75 percent) and PT Tatawahana Duta Persada (17.25 percent).
Juloi was awarded with a contract area around 192.000 hectares in North Barito Regency, Central Kalimantan, while Lahai and Ratah recived contracts covering around 98.000 hectares in North Barito and West Kutai regency, East Kalimantan and around 100.000 hectares in North Barito and West Kutai, respectively.
The three companies have the rights to develop their contract areas for 30 years.
Simon further said Koba Tin signed its contract in 1971 with concession located on Bangka Island, South Sumatera. It started production in 1973. The contract, which will expire in 1973, was extended for 10 years.
The company had invested US$ 92 million until 1999 with the current production reaching 100.000 tons of tin metal per year, Simon said.
Karimun Granite Signed its contract in 1971 to develop granite resources on Karimun Island, Riau. It started production in 1973.
The company first extended its contract for 10 years in 19993. The extended contract, which will expire in Sept. 30, 2003, was further extended for another 10 years.
According to Simon, Granite has invested a total of US$ 57.5 million until 1999 with annual output of 4 million tons of granite stones.
Simon said under the contracts, the five companies have to pay taxes to the government in accordance with the prevailing tax regulation.
Under their coal contracts, Juloi, Lahai and ratah have to submit 13.5 percent of their out put in cash to the government as the principal, he said.
As far as Koba Tin and Karimun Granite are concerned, the government had improved the terms of their contracts regarding their obligation to promote the community and regional development, Simon said.
Simon said under the contract awarded to Juloi, Lahai and Ratah, the contractors were fully responsible for the management of their operation. As such, they were not obligated to pay advance payment to the government for service in the interest of the companies. (godang)