Copper and gold miner Newmont Nusa Tenggara has planned contingency measures, including the possibility of work stoppage, should the government go ahead with a contentious plan to ban exports of unprocessed ore next year, according to a memo received by the Jakarta Globe.
“Over the past year, NNT has engaged with the government wanting to continue to export copper concentrate after January 12,” Martiono Hadianto, the president director of Newmont Nusa Tenggara said in the memo dated Sept. 16.
The company did not receive confirmation if it would be allowed to export after the deadline, he added.
“Under these circumstances, we must develop contingency plans in the event of export being banned, including the possibility of ceasing operations at [the] Batu Hijau [mine],” the memo said.
“If our company cannot export copper concentrate, we will be unable to generate sufficient revenue from sales to the Gresik smelter to pay for our costs and expenses,” Martiono said.
NNT currently supplies about 30 percent of its concentrate to a smelting facility in Gresik, East Java. It has conducted studies to look into the possibility of building its own smelter, but concluded this was unfeasible, according to the memo.
Martiono told the Jakarta Globe that the memo was intended for internal purposes and was painting the worst possible scenario for next year.
Susilo Siswoutomo, the deputy minister for energy and mineral resources, said in Jakarta on Thursday that the government had not learned about the memo.
“We’ll just wait and see,” he said.
Indonesia plans to increase export tariffs for unprocessed mineral ore, as part of efforts to compel miners to build smelters in the country and add value to the nation’s mineral exports, government officials said last month.
Thamrin Sihite, the energy ministry’s director general for coal and mineral resources, said last month that mining commodities must processed domestically before being sold to overseas markets. JG