House pledges to finalize COWs deliberations soon
JAKARTA (JP): House of Representatives' Commission VI has promised to finalize deliberations on the seventh generation draft contracts of work (COWs) this month as the government had cleared the bribery issue related to the mining contracts.
Commission VI for industry, mining, manpower and investment had threatened to delay deliberations on the contracts until the government cleared the bribery issue.
Minister of Mines and Energy I.B. Sudjana said yesterday that during his five years of tenure, he had never bribed the House, nor been asked for bribes by House members.
"The bribery issue is not true. The papers which published the issue might now be motivated to mess up the political situation," he said during a hearing with the commission Thursday evening.
Commission VI chairman, Erie Soekardja, told The Jakarta Post after the meeting that Sudjana's explanation was enough to resolve the issue and the commission would resume deliberations on the contracts.
"We'll finalize the deliberations on the contracts and give a recommendation to the government this month," said Erie, a Golkar representative.
Several newspapers earlier reported that COW applicants had been asked to pay about Rp 25 million (US$9,915) per application to finance the commission's week-long inspection tour across the country earlier this month. There are 164 applications for the seventh generation COWs.
The tour involved commission members visiting provinces where the concessions applied for are located and was part of the commission's deliberation process to decide which draft COWs to grant.
Press reports quoted industry sources as saying the money was given to the commission through the Directorate General of Mining.
Ministry of Mines and Energy spokesman Bangun Usman Harahap confirmed the directorate had asked for Rp 24.7 million (US$9,150) per application from mining companies that had applied for COWs.
He said the payments were legal and treated as donations to cover the cost of photocopying bulky COW documents.
The 1967 mining law obliges the government to consult with the House over mining contracts before it gives the contracts to the President for final approval.
Erie earlier acknowledged that the commission had accepted money from the government to pay for its inspection tour.
Director General of Mining Adjat Sudradjat said the tour fund was not from investors but from the state budget.
Busang
Adjat also said at the hearing the directorate has examined the seventh generation COWs applicants' performance and prestige to prevent scams like the Busang case.
Canadian firm Bre-X Minerals claimed to have found the world's largest gold resource in Busang in East Kalimantan, prompting many giant companies and some eminent Indonesians to vie for claims in the mine.
But an independent study showed the Busang gold deposit to be insignificant.
Adjat said the examination focused on Canadian applicants which account for 75 percent or 124 of the 164 mining firms which applied for seventh generation COWs.
He said as part of the examination, the directorate had asked for information on the performance of the 124 Canadian mining companies from the Canadian embassy here.
A group of mining officials, headed by Sudjana and Adjat, recently visited Canada to seek further information about them, he said.
They also visited the Canadian Department of Resources, several big mining firms, the stock exchange in Vancouver, Toronto and Calgary and Canada's Association of Prospectors and Developers.
The Canadian government will send a team of experts to Indonesia in November to help examine the 124 applicants, Adjat said, adding Canada supported the Indonesian government's actions. (jsk)