Tondano court to go ahead with mine closure order

The district court in Tondano, Minahasa, North Sulawesi said it would go ahead with its decision to shut down Newmont Minahasa Raya's gold mine if the Supreme Court's letter asking it to delay its order it does not reach its office by April Sunday (tomorrow), Kompas daily reported on Saturday.

"We will go ahead with our order, because we have not received any written order from the Supreme Court to delay the execution of our request," said Suatan, one of the district court's judges handling the Newmont case.

He said he did not know why the Supreme Court's letter requesting for a delay in the closure order had been widely published in the local and national newspapers while the Tondano court itself had yet received the request.

"But if we get the letter we will certainly follow the order from the Supreme Court," he said.

The Supreme Court was reportedly to have sent a letter to the district court early this week asking for a delay in the execution of the latter's provisional decision to shut down Newmont's gold mine by Sunday at the latest.

The district court issued a provisional ruling last Saturday ordering the temporary closure of Newmont's mine over a tax dispute between Minahasa regency and the company. The court's order was issued after a joint verification team comprising local officials, officials from the Ministry of Mines and Energy and Newmont executives failed to reach an out-of-court settlement.

The Minahasa regency sued Newmont for a total of Rp 19 billion (US$2.4 million) in taxes on the overburden it extracted from 1995 to 1998. Newmont refused to pay, saying the taxes were not included in its contract of work and that it had extracted the overburden to access the gold deposit underneath.

Under local tax regulations, mining companies are obliged to pay taxes on gravel, sand and stone extracted and commercially used. The regency believes Newmont commercially used the overburden it extracted. (*)