The ongoing divestment of PT Newmont Nusa Tenggara (NNT) may be disrupted since one of its shareholders, PT Pukuafu Indah, has filed a legal suit against foreign shareholders.
NNT is a local unit of US mining giant Newmont Corp, and operates the Batu Hijau mine, Indonesia's second-largest copper mine.
A 1986 mining contract requires NNT's foreign shareholders, Newmont and Sumitomo, to gradually divest their 31 percent stake in NNT to the government or local parties it appoints.
Of this 31 percent stake, the foreign shareholders already sold a 10 percent stake to PT Multi Daerah Bersaing (MDB), a local company 75 percent owned by PT Multicapital (a business unit of giant coal producer PT Bumi Resources) and 25 percent owned by three regional administrations in West Nusa Tenggara. Through Bumi, MDB paid US$391 million for this 10 percent stake.
Next week, the foreign shareholders expect to sign a sale and purchase agreement to divest another 14 percent stake in NNT, also to MDB, in a deal valued at around $494 million.
However, Pukuafu president commissioner Jusuf Merukh said the entire process was illegal.
"A shareholders meeting on Nov. 15, 2005 agreed the 31 percent stake would be divested to Pukuafu. The shareholders meeting was approved by the energy and mineral resources minister," Jusuf said.
The 1986 mining contract states that of the 31 percent stake, 3 percent must be divested in 2006, 7 percent in 2007, 7 percent in 2008, 7 percent in 2009, and 7 percent in 2010.
Jusuf said that the divestment of the 3 percent stake in 2006 and 7 percent stake in 2007 to Pukuafu were then reinforced in another NNT shareholders meeting on May 21, 2007.
"These *divestments* were stipulated in legal certificates," he claimed.
Pukuafu had already paid for the 7 percent stake that was supposed to be divested in 2008, Jusuf said.
"A sales and purchase agreement for this was signed on May 16, 2008. We paid $258 million for the 7 percent stake to Newmont Indonesia Limited *Newmont* and Nusa Tenggara Mining Corp. *Sumitomo*," he said.
Pukuafu has filed a legal suit at Central Jakarta District Court, Jusuf added.
"Next week will be the second court session," he said.
NNT spokesman Rubi W. Purnomo could not be reached for comment.
NNT operates the Batu Hijau mine, Indonesia's second-largest copper mine. The mine is an important asset since it has already reached a production stage.
The consolidated gold sales from the Batu Hijau mine during the first nine months of this year totalled 381,000 ounces, up from 185,000 ounces in the same period last year. Meanwhile, the mine's consolidated copper sales reached 342 million pounds, up from 201 million pounds in the same period last year.
Pukuafu currently owns a 20 percent stake in NNT.
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