D

espite recent statements that it would pull out completely from Indonesia, the world's largest mining company BHP Billiton has now admitted that it will maintain 75 percent of its stake in the Maruwai coal project in Central Kalimantan, an official said.

"Yesterday BHP reported that it would only divest 25 percent of its stake in the projects. Thus, there is nothing special in this case actually," Director general for coal, minerals, and geothermal Bambang Setiawan told reporters Thursday.

Bambang said several companies were already interested in acquiring the shares and that BHP would make a decision on this no later than the end of March this year.

"We want them to make the decision faster, because they have no reason to prolong the process as with the 75 percent stake, they will remain the operator of the project," he said.

The Maruwai coal project consists of seven Coal Contracts of Works (CCoW), locally known as PKP2B, with a total working area of 330,000 hectares. The initially proposed main development was the Haju open cut mine, one of the seven, on which BHP planned to invest about US$100 million in investment. The company had originally planned that the mine should begin coal production by the middle of 2009.

However, in June last year BHP announced that it had stopped the development of the Haju mine, stating that this was not sufficiently in line with the company's long term investment strategy. The company also announced that it decided to stop a feasibility study of the Lampunut Block, another mine in the Maruwai project and also put its activity in the other five areas on hold subject to further study and a final decision.

"We are reviewing *with a view to* canceling all projects in Indonesia," Indra had said earlier. "These projects do not fit with the company's long-term strategy," Indra Diannanjaya, the Maruwai project's external relations manager had said on June 9, 2009.

But this earlier threat to drop the proposed Maruwai coal investment, along with the danger of a total disinvestment from Indonesia by BHP Billiton has now been reversed and BHP now remains interested in a huge nickel project, which could also have been dropped.

Earlier in November 2008, BHP had decided to drop its plan to develop a $4.5 billion nickel mining and refining project in the Buli area of North Maluku. Initially, BHP planned to develop the area with Indonesia's second-largest nickel producer PT Aneka Tambang (Antam).

But, Bambang said that he was now optimistic that BHP would remain operating in Indonesia and not implement the earlier threatened disinvestment.

"They said that they were even ready to build a railway for the coal transportation in Maruwai if no other private investor was interested in doing this," he said.