Five Indonesia’s Mineral Firms Carry Out Divestment in 2019-2020

Five Mineral Companies Will Carry Out the Divestment - Photo by EMR Ministry Office

JAKARTA (TheInsiderStories) – Indonesia’ Energy and Mineral Resources (EMR) ministry said there are five mineral companies that will carry out the divestment in 2019 – 2020. Previously, two largest minerals producer PT Freeport Indonesia and PT Amman Mineral Resources has fulfilled their obligations.

The five companies were PT Vale Indonesia (IDX: INCO), PT Natarang Mining, PT Galuh Cempaka, PT Kasongan Bumi Kencana and PT Ensbury Kalteng Mining and PT Nusa Halmahera Mineral, has a deadline of up to 2020 to fulfill the obligations.

Director for EMR ministry Yunus Saefulhak reported to the parliament on Tuesday (03/12) afternoon, majority of these companies are engaged in mining gold commodities. He added, each of these companies had a different portion in the obligation to divest their shares of Indonesian ownership.

In details, he explained, Natarang Mining (gold commodity) will divest 21 percent of shares, Ensbury Kalteng Mining (gold) 20 percent, Kasongan Bumi Kencana (gold) 12 percent, Galuh Cempaka (diamond) 17 percent and INCO (nickel) is 20 percent.

Although with a different share of liabilities, Saefulhak said the divestment scheme carried out by the five companies remained the same in business to business process but still provide a report to the ministry.

Until now, he said, Vale Indonesia and Natarang Mining’ has send letters to the ministry on the divestment planned. In addition, the official mentioned that the companies had begun the negotiation process with state-owned mining companies, such as namely PT Asahan Indonesia Aluminium and PT Aneka Tambang Tbk (IDX: ANTM).

Indonesian government hopes the realization of investment in the energy and minerals sector will rise in 2019. Last year, the investment realization recorded US$32 billion, grew by 16,36 percent compared to the previous year of $27.5 billion.

In Jan. 3, deputy Minister of EMR Arcandra Tahar stated, in 2018, the oil and gas investment only reached $12.3 billion and mineral sectors contributed $6.8 billion dollars.

For the 2019 projection, Tahar not give any clues. But. he hoped there will be an increase in investment in 2019, moreover the trend of oil prices that continue to rise.

On the other hand, EMR minister Ignasius Jonan conveyed there is a large investment, especially in exploration project, ready to develop in this year. He said, the ministry has obtained exploration commitments up to $2 billion.

by Linda Silaen, Email: linda.silaen@theinsiderstories.com