Indonesia Government: 'Won' Arbitration Case Against Newmont Unit
01 April 2009 - 1:47PM
Dow Jones News
The Indonesian government said Wednesday that it had "won" an
arbitration case against a local unit of Newmont Mining Corp.,
(NEM) after arbitrators ruled Newmont must divest 17% of the unit
within 180 days from Tuesday.
The government also said it can revoke Newmont's operating
licence should the company fail to meet the deadline to divest the
stake in PT Newmont Nusa Tenggara, or PTNNT.
Tuesday, people familiar with the matter had said that the three
international arbitrators overseeing the case had said the
government could not revoke Newmont's operating licence, known as a
Contract of Work.
However the statement from the government said it "has the
right" to revoke the contract should Newmont fail to meet the
divestiture deadline.
The people familiar with the matter on Tuesday also said that
Newmont had to sell 10% of PTNNT.
"The government of Indonesian has won against the foreign
company," Minister for Energy and Mineral Resources Yusgiantoro
Purnomo said in the statement.
"This sets a positive precedent for the government to continue
to take strong action against foreign companies that do not fulfill
their responsibilities but simply abuse their privileges. It also
proves that (Newmont) was wrong and must improve its conduct if it
wishes to continue operating in Indonesia," he added.
-By Reuben Carder and I Made Sentana, Dow Jones Newswires; 62 21
3983 1277; Reuben.Carder@dowjones.com;
I-Made.Sentana@dowjones.com