Minerals This Week...

Minerals This Week…

Lots of stories happened in this week, starting from nickel, copper, coal, to manganese. Companies bust up all over Indonesian regions to make investments. Starting from now, I will make a compilation to sum up all minerals stories happened in the week every Sunday.

Nickel

Jilin Group

Jilin Non-Ferrous Metal Group Ltd clinched deal with PT Billy Indonesia to establish nickel refinery factories in the regencies of Bombana and North Konawe, Southeast Sulawesi. Under the MoU, the Chinese company will invest up to US$6 billion, funded by Jilin Provincial Party Committee. The factories is expected to produce up to 100,000 tons of nickel, more than PT INCO’s annual capacity. The establishment expected to kick off by 2012.

Antam

The state-owned company plans to issue Rp4 trillion bonds to fund up their East Halmahera ferronickel factory despite uncertainties. Antam on next November plans to issue the initial phase bond worth of US$150 billion, and ensured will be dominated on Rupiah.

Solway

Chairman of Investment Coordinating Board (BKPM), Gita Wirjawan said the Russian group plans to invest up to US$2-3 billion to work up nickel smelter factory in Maluku.

Raja Ampat

Director General of Mineral and Coal Thamrin Sihite said the Ministry of Energy and Mineral Resources urges local administration to stop all mining operations at the West Papuan tourism hot-spot. The DG said the ministry will closely supervise all mining activities in remote areas, including nickel mining in the West Papua.

Tsinghan

Tsinghan Steel and Bintang Delapan Group plans to build an integrated nickel project with US$4 billin investment in Central and Southeast Sulawesi provinces. In the first stage, the project needs at least US$1 billion of investment. Minister MS Hidayat stated his side is possibly will award them tax holiday.

Copper & Gold

Freeport

Workers Union of Freeport kicked off their one-month strike this week following dead-end negotiation on salary rise. Some ministers claimed the company suffers at least US$19 million per day following the strike. Several efforts had been made by the government but still failed until now. From 8,000 workers striking, around 600 of them were reportedly go back to work but the rest are still adamant. Freeport told New-York Stock Exchange authorities that around 50% of the workforce resumes limited operation of Grasberg. Freeport stated around 3 million pounds of copper and 5 thousand ounces of gold lost per day. The company is still working on revised operating plans right now.

Newmont

President Director of PT Newmont Nusa Tenggara (NNT) Martiono Hadianto claimed Newmont Venture Ltd has removed its voting rights on NNT to acquire 2.2% shares by PT Indonesia Masbaga Investama. According to the CEO, the removal was made on 16 September 2011, but so far, Newmont has made no reports to stock exchange authorities. On the other hand, PT Pukuafu Indah again reminds the government and all related parties that the 2010 NNT’s 7% divested shares is officially belonging to and owned by Pukuafu following the decision of South Jakarta District Court.

Coal

Krakatau Steel

The state-owned steel maker will establish PT Krakatau Natural Resources (KNR) to work up iron ore and coking coal opportunities to support its parent company’s work. KNR is reportedly will acquire several mining companies but no clear reports so far.

United Coal Indonesia

Local residents of Palaran, East Kalimantan urged PT Energi Cahaya Investama, subsidiary of United Coal Indonesia, to stop their mining activities following no agreement reached yet with between the company and the residents. No respond from United Coal yet so far.

Kaltim Prima Coal

The subsidiary of Bumi Resources plans to boost their production from 43 million tons to 56 million tons in 2012 and 70 million tons in 2013. To support the plan, the company claimed they are working on infrastructures, equipments, and human resources. Mining Advocacy Network (Jatam) of East Kalimantan has rejected the plan following environmental damage.

Indomobil Sukses International

The Salim Group’s automotive company enters coal business by having a coal mine in Berau, East Kalimantan. This year, the company plans to produce up to 1.7 million tons, but the company later stated it will be possibly missed.

Ancora

The Gita Wirjawan’s company has bagged US$25 million loan commitment from several banks to fund up the Raja Kutai Baru Makmur acquisition. Around US$12 million will be used to acquire the company, while the rest allocated for RKBM’s capital expenditures.

Cokal Ltd

The ASX-listed company purchase additional 10% shares in PT Bumi Barito Mineral and PT Borneo Bara Prima, making its ownership increased to 60% both. The concession is quite interesting, covering a justified area of more than 30,000ha and immediately adjacent to BHP Billiton’s Juloi and Maruwai tenements.

UNTR & DOID

United tractors coal production in the first eight months to August 2011 rose 9.8% to 55.8 million tons, and has sold 2.91 million tons during the period, surged 74%. On the other hand, Delta Dunia’s production inched up 0.44% to 22.7 million tons in the period.

Metacorp

Metacorp Bhd and PT Krakatau Bandar Samudera, subsidiary of PT Krakatau Steel, officially opened the CIgading International Bulk Terminal, West Java. The terminal is expected to have a handling capacity of 10 million tons.

Policy

Simon Wong, Senior Analyst and Vice President of Moody’s Rating Agency, says the new Indonesian regulation to repatriate export earnings will bring negative impact to miners and Plantation companies. On Moody’s Weekly Credit Outlook, the VP said the rule affects approximately $30 billion in export revenue held offshore and will have a similar aim and effect as the January 2010 closing of a withholding-tax loophole for cross-border debt. Similar to the closure of the withholding-tax loophole, the Indonesian government’s aim with the latest regulation is to reduce tax evasion while also lowering the country’s reliance on foreign capital. (The Indonesia Today)

Mangan

SMR Utama

SMR Utama plans to offer 500 million shares through IPO, representing 33.33% of its paid up capital, to raise up to Rp300 billion. PT Andalan Artha Advisindo Sekuritas will act as underwriter for the IPO. After IPO, the company's shareholders would be PT Dana Hayati Wisesa (13.33%), PT Alam Abadi Resources (53.33%) and public (33.33%). (The Indonesia Today)

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