Mining juniors still welcome in Indonesia
By MEL DUVALL
Calgary Bureau The Financial Post
Indonesia's powerful mining minister took great pains yesterday to assure Canadian mining
companies they are still welcome in the mineral-rich nation, despite the fallout over the Bre-X
Minerals Ltd. scandal.
The minister, who was in Calgary to speak with mining and oil and gas representatives before a stop
in Edmonton for an Asia-Pacific energy conference, said as far as his country is concerned, it is
business as usual for Canadian miners.
"We recognize Canada's strength and capability in the mining sector, not only in terms of mining
experience and expertise, but also that global mining investment flows through Canada," Ida Bagus
Sudjana told about 60 business people at a downtown hotel.
The minister did not take questions and did not directly address the Bre-X affair. However, his
director general of mines, Adjat Sudradjat, did broach the subject with reporters.
Sudradjat said there are still some "strong emotions" related to the Bre-X scandal, believed to be
the biggest mining fraud in history. But he said it would be foolish for the country to punish Canadian
mining firms and investors.
"Of the investment in our mining sector, close to 75% originated from Canada," he said. "Therefore
it is very important for Indonesia to maintain close ties with Canada."
Ranjeet Sundher, president of Indogold Exploration Services, a Jakarta-based company that acts
on behalf of Canadian junior miners, said the minister's comments were sorely needed.
"There was a real perception here that Canadian junior miners were no longer welcome in
Indonesia," he said. "I think a lot of the juniors felt recent changes [to government contract of work
procedures] were directed at them."
Sundher said his company has experienced a dramatic decline in business from Canadian firms since
a private investigation this spring determined there was very little gold at Bre-X's fabled Busang
deposit.
Representatives of the Indonesian mining ministry met with about 25 junior miners over the
weekend on a one-on-one basis to discuss their concerns and to provide updates on their contract
of work procedures applications.
"It's a real indication that the government of Indonesia wants to put all of the anger from the last six
months behind," said Simon Brooksbank, manager of mining operations for Monenco Agra Inc. of
Calgary.
Since its arrival in Canada, the Indonesian delegation has not been approached by the RCMP
officers who are investigating the Bre-X affair, Sudradjat said. The ministry and its officials are
co-operating fully with investigators at home and abroad, he added.
Included in the changes to the country's contract procedures are rules designed to take into account
amendments to the country's tax law. Those amendments reduced corporate taxes to a maximum of
30% from the previous 35%.
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First positive news I've heard about Indonesia in a long time. Maybe
the beginning of the end of the post-Bre-X nightmare.
Bear |
