Medco Prepares Smelter To Take Over Newmont Share

Jakarta (Antara Bali) - A national oil and gas company, Medco Energi Internasional, is preparing the construction of a smelter in order to takeover of 76 percent share of Newmont Nusa Tenggara mining company in Batu Hijau, Sekongkang, West Sumbawa district, West Nusa Tenggara province.

President Director of Medco Energi Internasional Arifin Panigoro has met the Coordinating Minister of Maritime, Rizal Ramli, here on Wednesday ) to discuss the technical plans and the acquisition of shares, including the construction of  smelter.

"One of the discussed points is the ability of Medco to build a smelter. We are committed that once the ownership is changed, smelter construction will be the priority project," he said.

Arifin explained Medco will build a smelter with a production capacity of 500,000 tons per day with an investment of approximately US$ 500 million to US $ 600 million.

"The current production is about 400,000 tons. We will build a smelter with a capacity of 500,000 tons," he noted, adding that two potential smelter construction sites are in Banten or at the mine site.

Minister Rizal Ramli said that smelter should be constructed by every mining company which operate in Indonesia.

"We want greater added value and Medco indicates its plan to build a smelter, as it is required by the Mining Law," he said.

According to him, though not all mining company has economic ability to build a smelter, however such giant mining company as Newmont must be able to build purification facilities.

Rizal also asked Medco to develop the area around the mining site, including exceed the electrical capacity for the community.

He hoped the share acquisition of Newmont by Medco can encourage the development of ten new tourist destinations, including Flores and Labuan Bajo. (WDY)