Regent praises Rio Tinto and BP

East Kutai regent Mahyudin has praised Rio Tinto and BP PLC, the former owners of PT Kaltim Prima Coal (KPC), for showing goodwill to pay bonuses to KPC’s workers, East Kalimantan-based paper Kaltim Post reported on Sunday.

The paper said the regent had sent a letter to KPC’s management expressing gratefulness to Rio Tinto and BP for their willingness to pay the “goodwill” bonuses amounting to US$6 million.

He however criticized both firms for failing to coordinate with him on the payment scheme of the bonuses. .

He said KPC’s former president Noke Kiroyan had asked him to help formulate the payment scheme. He and KPC’s workers have agreed on a payment scheme, which is different from the scheme proposed by Rio Tinto and BP.

Rio Tinto and BP proposed among others that each of the workers of the A to E categories get Rp 2.06 million multiplied by the respective working period.

However, the regent proposed that the workers of the A to E categories get Rp 11 million each plus Rp 795,000 multiplied by their respective working periods.

Also on Sunday, Kaltim Post published the statement from KPC's workers, saying they supported the regent’s proposal.

The workers launched strike last month to demand bonuses from Rio Tinto and BP following their decision to sell their entire stake in KPC to local firm PT Bumi Resources for US$500 million. (*)