Newmont files arbitration over export restrictions

PT Newmont Nusa Tenggara (PTNNT) and its majority shareholder Nusa Tenggara Partnership BV (NTPBV), a Dutch entity, announced on Tuesday the filing of international arbitration against the Government of Indonesia to seek relief from export restrictions that have halted production at the Batu Hijau mine and inflicted hardship and economic loss on PTNNT?s employees, contractors, and other stakeholders.

The government?s imposition on PTNNT of new export conditions, a new export duty, and a new January 2017 ban on the export of copper concentrate violates the Contract of Work (CoW) and the bilateral investment treaty between Indonesia and the Netherlands. In the filing made with the International Center for the Settlement of Investment Disputes, PTNNT and NTPBV state their intention to request interim, injunctive relief to allow PTNNT to resume exporting copper concentrate so that Batu Hijau operations can be restarted.

?Despite our best efforts over the last six months to resolve the export issues through good faith commitments to support the Government?s policy, PTNNT has been unable to convince the Government that our CoW should guide resolution of our differences,? said Martiono Hadianto, President Director of PTNNT. ?As a result, PTNNT and its shareholders are left with no option but to seek relief through international arbitration to ensure our stakeholders? jobs, rights, and interests are protected. We want continued dialogue with the Government to lead to a resolution outside of arbitration. In the meantime, we have an obligation to protect the value of Batu Hijau and the thousands of jobs it provides, as we are still unable to export copper concentrate due to the regulations.?

The Batu Hijau copper and gold mine is in care and maintenance as efforts to resolve the export issues continue. The company is maintaining appropriate controls to protect the safety and security of people, water resources, and the environment. PTNNT also will continue selling copper concentrate from storage to PT Smelting in Gresik, Indonesia through the remainder of 2014, allowing for shipment of 58,400 tonnes of concentrate through the end of the year. PT Smelting has capacity limitations and cannot purchase sufficient quantities of PTNNT?s copper concentrates to allow for ongoing normal operations at Batu Hijau.

Editing by Johannes Simbolon