Sun, 22 Mar 2009
From: Reuters
March 22 (Reuters) - Indonesia has some of the world's top reserves of energy and minerals, although in recent years it has struggled to attract enough investment to maximise development of rich deposits that include coal, gas, copper and nickel.

The country hosts a number of major global resource firms and there has been a long history of foreign involvement in the sector, although some firms have been involved in disputes, including over contracts and allegations of environmental damage.

GOVERNMENT FORECASTS ON MINING INVESTMENT

- Indonesian mining and geothermal investment is projected at $2.24 billion in 2009, up from $1.6 billion in 2008.

Source: energy and mines ministry.

OIL EXPLORATION INVESTMENT

- Oil exploration spending is seen at $2.7 billion in 2009, from $1.8 billion in 2008.

Source: Indonesia's energy watchdog, BPMIGAS.

SOME CURRENT DISPUTES INVOLVING FOREIGN RESOURCE FIRMS

* Indonesia appoints state energy firm Pertamina as operator of the giant Natuna D-Alpha gas field, arguing a contract held by U.S. oil major Exxon Mobil Corp (XOM.N) expired in 2005.

Exxon Mobil's Indonesian unit disputes that the contract is not in force, but says it is seeking a resolution after Jakarta rejected on Jan. 16 its proposal to develop the field.

The Natuna D-Alpha block in the South China Sea is estimated to hold about a quarter of Indonesia's commercially recoverable gas reserves and needs investment of about $40 billion.

Pertamina says it plans to decide on its technical partners for the project in the next few months.

* An Indonesian court clears Newmont Mining Corp (NEM.N) and the American president of its local unit of dumping toxic waste into a bay near a gold mine in North Sulawesi in April, 2007.

Newmont had previously settled a civil case without admitting wrongdoing and agrees to pay $30 million to an environmental foundation in North Sulawesi.

Another court later clears Newmont over an environmental group's lawsuit accusing it of polluting Buyat bay, but a Supreme Court decision on an appeal is still awaited.

* Newmont and the Indonesian government file arbitration notices in March 2008 over a dispute on whether the company has complied with its divestiture obligations.

Under its contract, PT Newmont Nusa Tenggara, which operates the Batu Hijau copper and gold mine in Sumbawa, eastern Indonesia, must sell 51 percent of its shares to local investors.

The government had threatened to annul the firm's contract if it did not sell the shares quickly enough.

Newmont said it was confident it had complied with the contract. The arbitration court is expected to reach a decision on March 31.

(Reporting by Ed Davies, Editing by Dean Yates)



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