Newmont?s royalty payment not in line with regulation: Legislator

Copper and gold mining operator PT Newmont Nusa Tenggara has inflicted a financial loss to the West Nusa Tenggara provincial administration, as the company?s royalty payment is not based on the government?s latest non-tax payment regulation, a local legislator has said.

A member of the Commission C of the province?s Legislative Council (DPRD), Ruslan Turmuzi, said in Mataram on Tuesday that the royalty payment was, instead, based on the company?s contract of work in which the royalty payment only covered the company?s gold production.

Ruslan said that the use of the contract of work as the base of the royalty payment had inflicted a loss to the local government because the company?s contract work did not cover the copper production.

Newmont, which began production only few years ago, was initially involved only in gold exploration. The company later found copper deposits, but its contract of work has not been changed, only covering gold production.

He acknowledged that the local government had renegotiated the royalty payment with the Ministry of Energy and Resources but the demand was turned down on the ground that the contract of work should be first amended to accommodate the new royalty regulation.

Under the latest regulation, the royalty payment is set at four percent of the total sales of the mineral products. (*)