Medco to take 76 pct of Newmont shares

The company`s president director, Arifin Panigoro, said the value of the transaction comes to around US$2.2 billion.
Jakarta (ANTARA News) - PT Medco Energi Internasional Tbk. will take 76 percent of the shares of PT Newmont Nusa Tenggara (PT NNT) in the Batu Hijau field, Sekongkang, Sumbawa Barat district in West Nusa Tenggara.

The companys president director, Arifin Panigoro, visited the office of the Coordinating Minister of Maritime Affairs, Rizal Ramli, here on Wednesday to report the plan.

"In essence, since mining falls within the responsibility of minister Rizal Ramli, we had come to report it (the development) to him. We have long intended to do so and have talked to the seller, namely Newmont, that we will immediately enter (into this deal)," he said.

Arifin said the value of the transaction comes to around US$2.2 billion.

He said he had signed a memorandum of understanding with PT NTT about these shares and hoped the transaction could be carried out at the end of this year.

"We have signed (the MOU) and so I hastened to report the move to him (minister Rizal) because we needed to do so before the end of the year," he said.

He said Batu Hijau has indeed passed the peak of production and it would only be in operation for the next five to six years.

However, besides the Batu Hijau field, there is a new field that has further potential for development, he said.

"Therefore, we have made a plan so that when production in one field is down, production in the other will start," he said.

Minister Rizal Ramlis response to Arifin Panigoros visit was good. Arifin Panigoro informed the minister regarding his plan to take over 76 percent of the shares in the copper and gold mine.

"Pak (Mr) Arifin came to ask for support to take over 76 percent of Newmonts shares. This is a good initiative because it shows that national powers, be it the government, the state-owned companies or private parties such as Pak Arifin, have the ability to manage a big mine like Newmont in West Nusa Tenggara," he said.

Rizal said the commitment was proof of the national companies capacity in managing big mines, a strength that has been undermined hitherto.

"I asked Pak Arifin not to disappoint us. We must prove that we can manage a big mine. We are a champion nation and not a loser," he said.(*)