Govt, Newmont Finalize Renegotiation

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  • TEMPO.CO, Jakarta – The government and PT Newmont Nusantara have signed a memorandum of understanding (MoU) related their mining contract renegotiation, Newmont president director Martiono Hadianto said on Thursday, September 04, 2014. Accroding to Martiono, the Directorate General of Mineral and Coal will issue an export recommendation to the Trade Ministry. 

    “Batu Hijau [mine] will resume its operation soon,” Martiono said. 

    Earlier, Director General of Mineral and Coal, Sukhyar, said Newmont has agreed on six points of contract of work renegotiation offered by the government. Sukhyar said one of the points cover increases in the amount of royalties to be paid by Newmont for gold, copper and silver, which were set at 3.75 percent, 4 percent and 3.25 percent, respectively. 

    Another agreement set forth in the renegotiation was the realization of Newmont’s work plans and mining area size. According to Sukhyar, Newmont’s plans to expand its mine to eastern regions can be done until the contract expires in 2030. 

    In addition, Newmont also agreed to deposit US$25 million as a guarantee to build smelters. Although the smelter will be built in collaboration with Freeport, the government demanded Newmont provide guarantee money as its commitment to buildiing the smelters. 

    As the agreement has been reached, Newmont is set to export its copper concentrates to Japan, Spain and Thailand in the first week of September 2014.