World Bank consultant hired to value KPC shares

The Ministry of Energy and Mineral Resources and the East Kalimantan provincial administration has agreed to hire a consultant from the World Bank to value the shares to be divested by coal mining company PT Kaltim Prima Coal, East Kalimantan-based daily Radar Kaltim reported on Monday.

The agreement was reached during a recent meeting in Bogor, West Java, Andi Harun, the secretary of East Kalimantan?s special commission for KPC?s divestment, was quoted by the paper as saying on Sunday.

The World Bank consultant, named Kemal Syamsudin, who is also a financial expert at the Ministry of Finance, was hired to value the 51 percent shares in KPC which the East Kalimantan provincial administration was seeking to buy, he said.

Andi further said that during the meeting, the ministry and the provincial administration had also agreed to assign the legal bureaus of the ministry and the provincial administrations to study the legal aspects of the divestment program and to ensure that no national and international laws would be broken in the purchase of the shares.

Andi said the ministry and the provincial administration would hold a meeting with the shareholders of KPC on the price of the coal company?s shares this week.

KPC, which is equally owned by Anglo Australian mining giant Rio Tinto and Anglo American energy giant BP Plc and operates a huge coal mine in Sangatta, East Kalimantan, is obliged by its contract to divest up to 51 percent of its shares to Indonesia.

East Kalimantan provincial administration had voiced interest to buy the shares, but thus far no agreement has been reached on the price of the shares.

In the past, the ministry and the province set different prices for the shares and they had often be in disagreement over approaches to KPC with regards the divestment. (*)