One firm cancels scheduled contract renegotiation MoU

One mining company backed down from a Friday schedule to sign an MoU with the government to conclude contract renegotiation, reducing the list of mining firms that were supposed to sign the MoUs to 25.

Dede I. Suhendra, director of mineral management and supervision at the Directorate General of Mineral and Coal was quoted by Bisnis Indonesia daily as saying that gold mining firm PT Mindoro Tiris Emas did not make to the list because it could not yet complete the necessary administration requirement on time. He said that the company will sign the MoU in the second round next week.

Six mineral mining companies and 19 coal mining firms on Friday signed MoUs with the government to finally reach agreement on the six points of contract renegotiation as mandated by the 2009 Mining Law. Major miners such as PT Freeport Indonesia, PT Newmont Nusa Tenggara, and PT Vale Indonesia have yet to conclude the contract renegotiation with the government.

The six points of contract renegotiation include the reduction of concession size, higher royalty, requirement to build domestic smelters, divestment obligation, requirement to use domestic goods and services, and conversion of contract into IUP mining business permit. (*)