By Deden Sudrajat and I Made Sentana
JAKARTA, Indonesia--Indonesia won't back down from preventing
exports by mining companies refusing to put up sureties they will
build smelters, the country's director-general of minerals and coal
says.
Mining companies must place cash equal to 5% of the cost of
constructing a smelter in local banks to show they are "serious,"
Director General of Minerals and Coal at the Ministry of Energy and
Mineral Resources Sukhyar said late on Thursday.
"The money will be returned after smelter construction is
completed," Mr. Sukhyar said. Companies promising to build smelters
can still export ore.
Indonesia banned ore exports on Jan. 12.
Six concentrates can still be exported until by 2017, according
to Finance Minister Chatib Basri on Jan. 13. But minimum purity
levels must be met and a special, 20% tax paid to export copper,
iron ore, manganese, lead, zinc and ilmenite. The tax increases to
60% in the second half of 2016.
Companies like Arizona-based Freeport-McMoRan Copper & Gold
Inc. (FCX) and Colorado-based Newmont Mining Corp. (NEM) oppose the
taxes.
They add to the cost of partly processed ore, they say. The
government wants to increase export revenue by adding value to ore
but the mining companies claim it will do the opposite.
Write to I Made Sentana at i-made.sentana@wsj.com
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