Arientha Primanita | February 22, 2012
A senior minister on Tuesday called for a renegotiation of royalty fees paid to the government by US-owned mining giants Freeport Indonesia and Newmont Nusa Tenggara.
Hatta Rajasa, the coordinating minister for economic affairs, said royalty fees paid by mining companies, especially Freeport, were not big enough.
“Now, it is only at 1 percent, it is very small,’’ Hatta said, referring to the royalty Freeport pays the government on its total gross sales.
The government is in the midst of contract renegotiations with Freeport, and has said it wants to reassess contracts with other miners.
Freeport Indonesia, the local unit of Freeport-McMoRan Copper & Gold, the world’s largest publicly traded copper producer, operates the Grasberg gold and copper mine in Papua. Newmont Nusa Tenggara is the Indonesian unit of Newmont Mining.
NTT, which signed its contract with the government in 1986 to operate the Batu Hijau gold and copper mine in West Nusa Tenggara, pays royalties of 1-2 percent on its gold production.
Hatta did not disclose the royalty level the government was seeking from the two miners, saying that was still to be renegotiated. “We cannot say it now,” Hatta said. Read More

