By I Made Sentana and Deden Sudrajat
JAKARTA, Indonesia-Indonesia Thursday demanded Newmont Mining
Corp (NEM) withdraw the international arbitration the Denver-based
miner filed earlier this month over a mineral export ban for
negotiations to resume, a government official said.
"The government's stance is that Newmont must withdraw the
arbitration request," said Sukhiyar, director general of coal and
minerals at the Energy and Mineral Resources Ministry, after a
meeting with Martiono Hadianto, chief executive of Newmont's
Indonesian unit.
Mr. Sukhiyar, who goes by one name, added that Newmont's
Indonesian unit has relayed the government's demand to its
headquarters.
"They said they still want to continue operations in Indonesia,"
he told reporters.
Mr. Hadianto separately refused to answer if Newmont will meet
the government's demand. But he said the company is committed to
reaching an agreement with the government for the resumption of
copper concentrate exports.
"The most important thing is that we can resume exports after
being halted for six months," he said.
Several government officials have said recently that they would
take "stern action" against Newmont, including the possibility of
terminating Newmont's mining contract, if it refuses to withdraw
the arbitration proceedings.
Newmont earlier this month filed for international arbitration
at the International Center for the Settlement of Investment
Disputes, seeking interim, injunctive relief to resume exports of
copper concentrate.
The filing came after the company halted operations at its Batu
Hijau mine in Sumbawa and declared force majeure last month,
arguing it could not meet its obligation to buyers after the
resource-rich nation banned ore exports in January and introduced
taxes on exports of mineral concentrates.
The government policies are aimed at keeping mineral-refining
processes within Southeast Asia's largest economy to benefit from
higher export proceeds from resources. It is one of several
policies Jakarta introduced in recent years that some argue smacks
economic nationalism as the resource-rich nation tries to gain
control of its vast resources.
Newmont complained that the new taxes violated its contract with
the government, which don't include a provision for export
taxes.
While negotiation with Newmont remains tough, the government
said last week it has agreed on new mining terms with Phoenix-based
Freeport-McMoRan Copper & Gold. Inc. which would pave the way
for the company to resume exports. The deal, however, is still
waiting for approval from President Susilo Bambang Yudhoyono.
Write to I Made Sentana at i-made.sentana@wsj.com