Newmont offers more share to Indonesia

Following the failure to offer three percent of its share to the Indonesian government last year, PT Newmont Nusa Tenggara (NNT) has raised the offering to seven percent, valued at US$325.36 million.

?Newmont offered seven percent (stake in PT NNT) to the central government (Finance Ministry) two or three weeks ago," said Simon Sembiring, Director General of Mineral, Coal and Geothermal was quoted by Kontan daily as saying Jakarta on Wednesday.

Under the contract of work (COW), NNT, which operates a huge copper and gold mine in Batu Hijau, West Sumbawa, has to divest up to 51 percent of its stake to either the Indonesian government, regional government, state owned companies or Indonesian-controlled companies. An Indonesian company, PT Pakuafu Indah has a 20 percent stake in the firm. This, the remaining stake PT NNT has to divest is 31 percent.

Director of Mineral and Coal Exploration MS Marpaung disclosed that the price offered by Newmont is based on the valuation made by Newmont of all NNT shares at $4.65 billion.

The government needed to review the calculation, Marpaung said, adding that the offering of 7 percent stake is valid until March 2008.

Last year, Newmont offered 3 pecent stake in NNT at $109 million to a consortium of regional enterprises belonging to West Sumbawa Regental and East Nusa Tenggara Provincial governments, wherein Bumi Resource reportedly has a stake. But, thus far, no transaction has been made. (*)