BKPM Believes Newmont Case will Not Affect Investments

TEMPO.CO, Jakarta - The Head of the Investment Coordinating Board (BKPM), Mahendra Siregar, said he believed the lawsuit filed by PT Newmont Nusa Tenggara would not affect investment in the mining sector, as reported by Antara News.

Speaking on Monday, Mahendra said he hoped the dispute between Newmont and the Indonesian government would end in a reasonable settlement for both parties and provide a good example of the governments firm action in settling disputes.

"So, we think the steps (to be taken by the governments special team) could be reflected well. It is also clear that the governments steps would end in a settlement and continuation of mining investments," he said after a coordination meeting of ministers concerned with economic affairs.

He also said it was hoped that the settlement of the dispute by the government would provide certainty and support to the development of the mining industry and protection of investors interests.

"This settlement will even offer more certainty with regard to future investment plans," he said.

Mahendra added that the process of negotiations on 67 out of 107 working contracts was continuing and had not been set back, despite the dispute with Newmont.

He added that 40 working contract holders had agreed to renegotiate their contracts following the implementation of Law Number 4 of 2009 on minerals and coal mining.

One of the main points in the law is about the imposition of new regulations relating to exports, export taxes and a ban on copper concentrate exports that began in January 2014.

Newmont and its major shareholder, Nusa Tenggara Partnership BV, as one of the large companies that holds working contracts, have rejected the governments ban on exports of concentrates and have filed a lawsuit in the international arbitration court.

The Indonesian government has asked Newmont to withdraw the lawsuit and return to the negotiating table, but Newmont, according to chief economic minister Chairul Tanjung has insisted on taking the case to court.

In view of that, the government decided to set up a special team to handle the case.

The president is expected to issue a decree on the establishment of the team on July 23 or 24.

He said the team would initially appoint a lawyer and offer an official response to Newmonts lawsuit, while preparing a counter-lawsuit.

Members of the team include officials from the office of the coordinating minister for economic affairs, the ministry of law and human rights, the ministry of energy and mineral resources, the attorney general and BKPM. The head of the team is BKPM head Mahendra Siregar.

ANTARA | HERU