Supreme Court orders delay in Newmont mine closure<\/p>\n
JAKARTA (JP): The Supreme Court has ordered the Tondano
\nDistrict Court in Minahasa, North Sulawesi, to delay the
\nexecution of its order shutting down PT Newmont Minahasa Raya's
\ngold mine.<\/p>\n
Richard Ness, the president of the company, said on Thursday
\nthe Supreme Court's decision was a victory for the people and
\neconomy of Minahasa regency.<\/p>\n
\"This is a victory for the 2,800 Minahasa residents who depend
\non our operation for their livelihood and would have been put out
\nof work by the Minahasa regent's determination to close the
\nmine,\" he said in a statement.<\/p>\n
Supreme Court Chief Justice Sarwata issued the order to the
\nhead of the Tondano District Court last Tuesday, after the
\ndistrict court had ruled that Newmont must shut down its mine by
\nSunday.<\/p>\n
\"You are also required to explain to the Supreme Court the
\nmatters regarding the closure ruling,\" Sarwata told the Tondano
\nDistrict Court head in his letter.<\/p>\n
The district court issued a ruling last Saturday ordering the
\ntemporary closure of Newmont's mine over a tax dispute between
\nMinahasa regency and the company.<\/p>\n
The Supreme Court's intervention follows protests from almost
\nall levels of the government, economic observers and legislators
\nover the district court's closure order.<\/p>\n
\"Our image has been greatly tarnished,\" State Minister of
\nInvestment and State Enterprises Development Laksamana Sukardi
\nsaid when commenting on the closure order.<\/p>\n
He said the district court's ruling would frighten off foreign
\ninvestors. \"Why should we place stumbling blocks in front of the
\ninvestors? We don't see such things happen in other countries. In
\nthose countries, all problems can be resolved through talks.\"<\/p>\n
Sarwata said the Supreme Court issued the order after studying
\ndocuments related to the case provided by the Ministry of Mines
\nand Energy.<\/p>\n
The ministry's secretary-general, Djoko Darmono, said the
\nSupreme Court's intervention would help the government ensure
\nlegal certainty in the mining sector.<\/p>\n
\"We're delighted with the Supreme Court's letter,\" Djoko said.
\nHe added that the regency's lawsuit against Newmont had damaged
\nthe image of the country's mining sector.<\/p>\n
He said that based on information from the ministry, the
\nSupreme Court had made its own judgment on the case. \"We don't
\nmeddle with the legal aspects of the case.\"<\/p>\n
Djoko said the government would now wait to see the response
\nto the Supreme Court's order, adding that this was an internal
\nmatter between the two courts.<\/p>\n
Newmont Minahasa, which is 80 percent owned by the Denver-
\nbased Newmont Corporation, produced 344,000 troy ounces of gold
\nin 1999. The company expects to increase its gold production to
\n350,000 troy ounces this year.<\/p>\n
Ness said the Supreme Court's move showed a sincere effort to
\napply the rule of law in Newmont's case.<\/p>\n
\"Clearly the Supreme Court has recognized the irregular nature
\nof the closure order,\" Ness said.<\/p>\n
The Minahasa regency sued Newmont for a total of Rp 19 billion
\n(US$2.4 million) in taxes on the overburden it extracted from
\n1995 to 1998.<\/p>\n
Newmont refused to pay, saying the taxes were not included in
\nits contract of work and that it had extracted the overburden to
\naccess the gold deposit underneath.<\/p>\n
Under local tax regulations, mining companies are obliged to
\npay taxes on gravel, sand and stone extracted and commercially
\nused. The regency believes Newmont commercially used the
\noverburden it extracted.<\/p>\n
The district court's order was issued after a joint
\nverification team comprising local officials, officials from the
\nMinistry of Mines and Energy and Newmont executives failed to
\nreach an out-of-court settlement.<\/p>\n
The verification team found that Newmont had used only a small
\nportion of the overburden for construction purposes, and ruled
\nthe company was only required to pay Rp 550 million in taxes.<\/p>\n
Newmont agreed to pay this amount and also to donate $2.4
\nmillion for community development programs. The regency, however,
\ndemanded an immediate cash payment of $3 million, which Newmont
\nrejected. (bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/supreme-court-orders-delay-in-newmont-mine-closure-1447893297",
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