JAKARTA (RambuEnergy.com) – At least five mining companies are mandated to divest shares this year in order to comply with the applicable ruling, Director for Mineral Business at the Indonesian Energy and Mineral Resources Ministry Yunus Saefulhak said.
The five companies are:
- PT Natarang Mining (gold) is required to divest 21% shares
- PT Ensbury Kalteng Mining (gold producer) is required to divest 20% shares
- PT Kasongan Bumi Kencana (gold producer) is required to divest 12% shares
- PT Vale Indonesia Tbk is required to divest 20% shares
- PT Galuh Cempaka is required to divest 17% shares
- PT Nusa Halmahera Minerals are required to divest 26% shares in 2020
Under the Indonesia’s divestment ruling, foreign mining companies are obliged to divest increasing portion of equity in locally domiciled entities to Indonesians in stages. This is aimed to increase Indonesia’s control the mining sector.
Based on the ruling, the foreign mining companies must start to divest from 5th year of production. Must divest at least 51 percent by 10th year. The Indonesian entities that can buy the stakes are the central and regional authorities, state-owned enterprises and third, the Indonesian private sector. If these parties are declined to buy the stakes, the company can opt to list on the Indonesian stock market.
The price of the equity is set according to negotiation, such as the case of Freeport divestment process.
Yunus Saefulhak said most likely the state-owned mining companies such as Aneka Tambang would be interested to purchase the stakes. (*)