Govt awards 24 contracts for mining projects

Govt awards 24 contracts for mining projects

JAKARTA (JP): The government yesterday awarded five working
contracts for general mining to foreign joint ventures and 19
cooperation agreements on coal mining for domestic companies.

The working contracts were signed here by Minister of Mines
and Energy I.B. Sudjana and executives of the joint ventures. The
agreements on coal mining were signed by the president of the
state-owned coal mining company PT Tambang Batubara Bukit Asam,
Ambyo Mangunwijaya, and executives of the domestic companies in a
ceremony.

"Under the cooperation agreements, eight companies are allowed
to explore and mine coal in East Kalimantan, one in Central
Kalimantan, five in South Kalimantan, four in South Sumatra and
another one in Riau," Sudjana said, adding that those contractors
will operate in a total area of around 1.6 million hectares.

He said the cooperation agreements were approved by the office
of the State Ministry of Investment, the Ministry of Finance, and
the House of Representatives (DPR).

"With the agreements, the government will receive a royalty of
13.5 percent of the coal to be produced by the contractors," he
said.

The royalty payment will be managed by Tambang Batubara.

Closed

Since 1991, the government has closed the coal mining industry
to foreign investors to protect domestic companies from fierce
competition.

According to Sudjana, the government has no intention of
changing the protection policy. "It is too early to change that,"
he said.

Prior to the 19 agreements, the government had awarded 11 coal
mining contracts to companies which had been committed to
investing US$1.30 billion, including $1.25 billion by the foreign
partners in the companies and the remaining $4 million by the
domestic partners.

The country's total coal production last year reached 19.8
million tons, as compared to 150,000 tons in 1988, while its coal
exports increased to 17.1 million tons worth $534 million from
688,650 tons valued at $23.7 million.

Director General of Mines Kuntoro Mangkusubroto told The
Jakarta Post after the signing ceremony that there are now more
than 20 domestic companies waiting for approval from the Ministry
of Mines and Energy for coal exploration in the country.

"The documents for their contracts are now under examination.
They are expected to explore for coal in a combined area of two
million hectares in Aceh, Jambi, Riau, South Sulawesi and West
and South Kalimantan," Kuntoro said.

General mining

Sudjana said that the five joint ventures that were awarded
working contracts yesterday will operate in Irian Jaya, North
Sulawesi and South and North Sumatra.

PT Ingold Antares, a joint venture that is 80 percent owned by
Ingold Ltd. of Canada and 20 percent by PT Kalirindo Gunung
Minerals, was awarded a contract for the exploration and
production of copper and gold in a 1.08 million-hectare plot of
land in Irian Jaya.

Eastern Irja Mining Corp. will conduct explorations for copper
and gold in Irian Jaya in an area of 1.23 million hectares. The
company is 80 percent owned by the U.S. Eastern Mining Co., 10
percent by PT Setdco Ganesha and another 10 percent by PT Bakrie
Indocopper Investama Corp.

PT Newcrest Nusa Sulawesi will survey for copper and gold in a
1.12-million hectare plot of land in North Sulawesi. The company
is a joint venture 90 percent owned by Newcrest Mining Ltd. of
Australia and 10 percent by PT Austindo Nusantara Jaya.

Paragon Perdana Mining, a joint venture 70 percent owned by
Hong Kong's Paragon Resources Ltd. and 30 percent by PT Keikan
Perdana Mining, will survey for zeolite in an area of 6,607
hectares in Lampung, South Sumatra.

Miwah Tambang Emas -- a joint venture 90 percent owned by
Australia's Highlands Gold Pty. Ltd. and 10 percent by PT
Marhuama Subur Gunung Minerals -- will survey for gold in a
211,790-hectare land in Aceh. (fhp)

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