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New UserGovt looks to seal deal with BHP coal units
29 Sep 2014
The Energy and Mineral Resources Ministry is targeting to soon close agreements with seven subsidiaries of global mining giant BHP Billiton of Australia that are holding coal contracts of work (CCoW).
The seven companies are Ratah Coal, Lahai Coal, Juloi Coal, Pari Coal, Sumber Barito Coal, Kalteng Coal and Maruwai Coal, according to Bambang Tjahjono, director for coal at the ministry’s mineral and coal directorate general.
“The debated point in the renegotiation is about divestment. The parent company [BHP Billiton] still wants to control [the subsidiaries] while we are asking for a divestment of 51 percent within 10 years after production, based on the law,” Bambang said.
Most of the companies are still undertaking feasibility studies, according to Bambang, while only two are conducting exploration work and one is undertaking construction work.
The ministry is targeting the signing of principal agreements in the renegotiation process during meetings with each of the companies that are scheduled this week. “We are in intensive talks and hope to sign memorandum of understandings [MoUs] before the month ends,” Bambang added.
The government is struggling to renegotiate a number of mining contracts of work, both in terms of CCoWs and minerals (CoW), aimed at adjusting points in the contracts to comply with the 2009 Mining Law.
MoUs that highlight the principal agreement of the renegotiation and a basis for further discussions of CCoWs and CoWs amendments, are targeted to be completed by the end of this September, as the new government is slated to take office on Oct. 20.
Source: The Jakarta Post