Sunday, January 15, 2017

1) MSG chair discusses membership in Vila

2) Army to develop 500 ha rice fields in Nabire, Papua

3) Indonesia pledges leeway for obedient miners
4) Jonan tells Freeport to release 51 percent of shares

1) MSG chair discusses membership in Vila
3:18 pm today 

The chair of the Melanesian Spearhead Group has arrived in Port Vila for discussions that cover membership guidelines.
Manasseh Sogavare, who is the Solomon Islands prime minister, is in the Vanuatu capital as part of his second MSG capitals' visit in his capacity as chair.
Mr Sogavare's office said that revised criteria for observer status and associate membership guidelines within the MSG will be discussed and endorsed.
This comes as the MSG considers a full membership application by the United Liberation Movement for West Papua which currently has observer status in the MSG.
Indonesia, which has associate member status, is opposed to elevating the West Papuans' status and the issue has proved difficult for MSG full members to settle on.
The full members are Papua New Guinea, Fiji, Solomon Islands, Vanuatu and New Caledonia's FLNKS Kanaks Movement.
Also on the cards for discussions is the matter of operations of the MSG's Port Vila-based secretariat which has struggled for funding and resources in the last couple of years.
While in Vila, the MSG Chair will be meeting with both the Vanuatu Prime Minister and FLNKS spokesperson.
Mr Sogavare and delegation will be departing on Wednesday for Suva, Fiji.

2) Army to develop 500 ha rice fields in Nabire, Papua

Senin, 16 Januari 2017 09:10 WIB | 497 Views
Jayapura, Papua (ANTARA News) - The Indonesian military plans to develop rice fields in the remote district of Nabire in the countrys eastern province of Papua this year.

The chief of the District Military Command 1705/Paniai in Papua, Lt. Col. Jerry Harapan Tua Simatupang, confirmed here on Sunday that the project was a cooperation project between TNI (the military) and the ministry of agriculture to increase food self-sufficiency especially in Papua.

He said several military officials from the command along with Trubus farmers group chief and a number of farmers inspected the area to be used for the project last week.

"The area spreads in Wanggar Sari village (80 hectares), Wiraska (57 ha), Wami (60 ha), Waroki (25 ha) and Maiday (108 ha)," he explained.

Simatupang said the inspection was needed to see possible hurdles that might be met during development process including irrigation issue.

"I will deploy all members of the community development unit to mentor the farmers with regard to achieving a maximum harvest," he said.(*)

3) Indonesia pledges leeway for obedient miners
Viriya P. Singgih The Jakarta Post
Jakarta | Mon, January 16, 2017 | 05:38 am
The government has reiterated that local miners, particularly nickel, bauxite and copper miners, will be allowed to export their products should they express a commitment to build their own smelters and be able to supply domestic smelters with at least 30 percent of their input capacity.
President Joko “Jokowi” Widodo’s administration issued on Jan. 11 the fourth revision to Government Regulation No. 23/2010 on the management of mineral and coal businesses, which allows miners to continue exporting copper concentrates, certain amounts of low-grade nickel ore and washed bauxite under certain conditions.
“Nickel and bauxite miners can export after supplying 30 percent of the input of existing domestic smelters. They also have to be committed to building their own smelters within five years,” Energy and Mineral Resources Minister Ignasius Jonan said Saturday in a press briefing.
“We will monitor [the progress] every six months. If they fail to fulfill the commitment to build the smelters, there will be no export licenses for nickel and bauxite miners.”
Jonan said there had been a misunderstanding over the newly-launched regulation, as many people interpreted that it was forcing local miners to funnel 30 percent of their nickel or bauxite production into local smelters, even though, he said, the correct calculation was based on the total capacity of all domestic smelters.
For instance, the total input capacity of nickel smelters in the country currently stands at 16 million tons per year. Meanwhile, the total production for low-grade nickel — with nickel content below 1.7 percent — stands at 10 million tons per year.
“So that means the nickel miners must sell to domestic smelters for about 30 percent of the 16 million tons of smelter capacity, or equal to 4.8 million tons, not of the 10 million tons of production capacity,” he said.
The government, Jonan continued, would serve as the “traffic manager” for the supply chain system in order to prevent unfair implementation of the regulation. For example, this is possible if there are only two or three companies supplying 4.8 million tons of nickel to local smelters through their own production.
According to the Processing and Smelting Companies Association (AP3I), 32 new smelters have been built in the country — 24 of which are nickel smelters — within the past four years with a total investment value of around US$20 billion.
The ban was a boon to rival producers as their output filled the hole, Bloomberg reported.
The Philippines became the world’s biggest supplier of mined nickel and the largest shipper to China. Now, their shares are tumbling. Nickel Asia Corp., the country’s top producer, fell 14 percent on Friday along with Japan’s Sumitomo Metal Mining Co. and GMK Norilsk Nickel PJSC.
The change in regulations may also upset Chinese investors that pumped money into developing Indonesia’s domestic processing industry. Citigroup had forecast a 180 percent increase in capacity by 2020, to about 400,000 tons, according to Bloomberg.
The 2009 Mining Law stipulates a mineral ore export ban to encourage smelter development in the country and to strengthen the processing sector. It has been applied to nickel, bauxite, chromium, gold, silver and tin.
However, because none of the proposed smelters were completed, including the one committed to by gold and copper miner Freeport Indonesia, the government has been forced to issue a new regulation extending export permits for certain mineral ores.
One of the requirements for miners to get an export recommendation from the government is to convert their permit status from a contract of work (CoW) to a special mining license (IUPK).
The government stated that Freeport Indonesia, the subsidiary of US giant Freeport McMoRan, had submitted an official letter confirming its commitment to convert its CoW into an IUPK. “They also mentioned their commitment to build the smelter within five years. If so, we will issue the export recommendation for them immediately,” Jonan said.
Freeport Indonesia claims it has allocated $2.2 billion in capital expenditure for the new smelter development, even though only $212.9 million has been disbursed so far, including $115 million as collateral to the government and $50 million to work on the smelter’s environmental impact analysis (Amdal) document and basic engineering.
“Freeport Indonesia has presented to the government its willingness to convert [its CoW] into an IUPK, that will happen if there is an agreement over investment stability and also fiscal and legal certainty,” Freeport Indonesia spokesman Riza Pratama told
The Jakarta Post on Sunday. The company has also confirmed its commitment to continue its new smelter development soon after it receives certainty over its contract extension for its Grasberg mine in Papua, the world’s largest gold mine and third-largest copper mine.
Freeport Indonesia’s contract is due to expire in 2021. However, the earliest miners can renegotiate their contracts is five years before they expire under the latest regulation.


4) Jonan tells Freeport to release 51 percent of shares
News Desk The Jakarta Post
Jakarta | Mon, January 16, 2017 | 01:31 pm

Energy and Mineral Resources Minister Ignasius Jonan has stressed that the government will require mining giant PT Freeport Indonesia to release 51 percent of its shares, stressing that there is no exception in abiding by the new mining regulation.
“There is no exception to the divestment. It must be 51 percent of its shares,” said Jonan on Monday, as reported by
The requirement for mining companies to divest 51 percent of their shares is stipulated in Government Regulation No. 1/2017 on the mineral and coal mining business. Initially, Freeport was only required to sell 30 percent of its shares, because the company has underground mining operations.
Jonan made the statement at his office in Jakarta on Friday, where he had a meeting with Freeport McMoran Copper & Gold Inc. president Richard C. Adkerson and Freeport Indonesia president director Chappy Hakim.
Jonan also said that Freeport had submitted an official letter confirming its commitment to convert its contract of work (CoW) to a special mining production (IUPK) license, as required by the new regulation.
“They also mentioned their commitment to building a smelter within five years. If so, we will issue the export recommendation for them immediately,” the minister added. (bbn)

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