Newmont Mining Corp., the world’s second-largest gold miner, may provide loans to governments in Indonesia to pay for as much as a 10 percent stake in the Batu Hijau gold-copper mine, an executive said.
The funds will be offered to the central government, the Nusa Tenggara Barat provincial administration and the districts of Sumbawa Barat and Sumbawa Besar, Martiono Hadianto, president director of PT Newmont Pacific Nusantara, said.
The stake sales at the mine are part of a divestment schedule mandated by Indonesian law to place a greater share of the asset, owned by PT Newmont Nusa Tenggara, in the hands of local investors. Newmont and Sumitomo Metal Mining Co., Japan’s second- largest copper smelter, own most of Batu Hijau.
“The loan is for the purchase of 7 percent stake valued at $282 million, and for 3 percent stake valued at $109 million,” Hadianto said in a news conference in Jakarta. Repayments will be made from dividends earned from the stake, he said.
Hadianto declined to estimate the total amount that may be loaned, nor the stakes that each local government may buy.
The mine is in Sumbawa Barat, about 700 miles east of Jakarta. It is the only productive mine in Indonesia for Denver-based Newmont Mining.
