N. Halmahera regency seeks 5% stake in Newcrest?s gold unit

The local administration of North Halmahera regency said that the regency is seeking 5 percent shares in North Maluku-based gold miner PT Nusa Halmahera Mineral (NHM), despite that NHM has no obligation of divestment.

Halmahera Utara Regent Hein Namotemo said in Jakarta on Monday the regency informed NHM and central government about the plan since last year. ?But until now NHM response is still in grey area,? he said.

The regency would buy the shares through the regency-owned company which will partner with a private company if NHM demands cash payment for the share purchase. One percent stake in NHM is valued at Rp 34 billion, he said.

NHM is now seeking to amend its contract of work and it is scheduled to present its amandment concept to the directorate general of mineral, coal and gothermal at the Ministry of Energy and Mineral Resources on June 23.

Bambang Gatot, the ministry's director of mining and coal production, confirmed the North Halmahera regency's intention to buy the NHM stake, despite that the firm does not have divestment obligation.

"The share purchase can be carried out through business-to-business mechanism," he said.

Bambang said the amandment proposed by NHM focuses on the amount of royalty and "third party contribution". But, he did not provide details.

Meanwhile, NHM?s president director Iwan Irawan said in Jakarta on Monday that the firm's gold production during the July 2009 to June 2010 periopd reached 405,000 ounces. This year, the firm targets to produce 450,000 ounces as against last year's target of 400,000 ounces.

Australian mining firm Newcrest Mining Ltd holds a 82.5 percent stake in NHM, while state-owned miner PT Aneka Tambang Tbk holds the remaining 17.5 percent. (bernard)