The sale of KPC?s 32.4 percent awaits Kutai Timur?s payment
Saturday, March 6 2004 - 04:16 AM WIB
Minister of Energy and Mineral Resources Purnomo Yusgiantoro said in Jakarta on Friday that the government would auction another 32.4 percent of KPC?s shares only after the East Kutai regency settled the payment of the 18.6 percent.
?The government?s position is in line with the decision made during between the team for KPC settlement and coordinating minister in December, last year,? the minister was quoted as saying.
KPC?s former shareholders, Rio Tinto and BP, were required to divest up to 51 percent of its stake in the coal producer two years ago as part of the mandatory divestment requirement stated in the company?s contract of works.
The KPC shareholders agreed to sell 18.6 percent of the coal producer?s shares to the Eats Kutai regency and the remaining 32.4 percent to the East Kalimantan provincial administration and state owned coal producer PT Batubara Bukit Asam.
The divestment, however, could not be carried out as expected because the East Kalimantan provincial administration and PT Batubara Bukit Asam insisted to buy all of the 51 percent shares, respectively.
Surprisingly, when the negotiations on the divestment were still going on, Rio Tinto and BP secretly sold their entire stake in the coal producer to Bumi Resources. Although the new shareholder agreed to continue the divestment process, similar problems still hampered the divestment program.
According to the sale purchase agreement signed in October, last year, East Kutai has six months to settle the payment. But the East Kutai regent said recently that the regency faced difficulties to find the fund for the payment. If the regency could not find sufficient funds to purchase the shares it would return it to the current shareholders, the regent said. (*)