Newmont Mining Corp made an announcement on Thursday, declaring its intention to seek legal intervention to restart work at its Batu Hijau mine, amidst a debate over a new copper export tax that caused them to stop shipping from Indonesia earlier in the year.
The main gold mining firm in the U.S. paused its copper concentrate exports from its mine located on Sumbawa, an Indonesian island, when January arrived. This pause was due to the Indonesian government’s decision to implement a rising tax on metal concentrates, aiming to encourage mining companies to construct smelters within the country.
In response to this export tax, which Newmont argues breaches its investment agreement with Indonesia, the company has filed for international arbitration against the Indonesian government.
Gary Goldberg, the CEO of Newmont, spoke at a gathering in Melbourne, sharing that the company is seeking temporary legal relief to reopen the mine and start exporting again, waiting for the arbitration’s final decision. He emphasized the intent to continue discussions with the Indonesian government alongside the arbitration process, although he mentioned he has no immediate plans to visit Indonesia.
Goldberg expressed a preference for settling the dispute through negotiation rather than arbitration, mentioning the possibility of engaging with the current or upcoming government to reach an agreement.
Meanwhile, Freeport-McMoRan Copper & Gold Inc, another mining giant, managed to negotiate a lower export duty of 7.5 percent last month and is on the path to resuming its copper concentrate exports.
Goldberg acknowledged the public stance of the Indonesian government denying ongoing talks, yet he remains optimistic about finding a resolution that benefits both parties.
Although there are no current plans to engage with Indonesia’s president-elect Joko Widodo, Goldberg remains open to opportunities for dialogue that might aid in resolving the situation.
On a related note, Goldberg revealed Newmont’s openness to revisiting merger discussions with Barrick Gold Corp, the world’s leading gold mining company, although no conversations have taken place since their last discussion ended without an agreement in April.
Regarding its Australian operations, after the sale of the Jundee mine for $91 million earlier this year, Goldberg confirmed that there are no plans to sell off their remaining sites as they are performing satisfactorily, including the Tanami mine in the Northern Territory.
This situation highlights the complex dynamics between corporate operations, government regulations, and international negotiations, particularly within the commodities sector in Indonesia.
