East Kalimantan adm try to block Bumi-Borneo deal
Bisnis Indonesia reported today that East Kalimantan province administration has filed a lawsuit to international arbitrary on the divestment of PT Kaltim Prima Coal, a move that might block the US$3.2 billion deal between PT Bumi Resources Tbk and PT Borneo Lumbung Energi.
The newspaper quoted P.D.D.Dermawan, a lawyer from DNC, representing East Kalimantan governor Suwarna (currently detained in a corruption scandal) saying his client filed the arbitrary case to International Center for Settlement of Investment Disputes (ICSID) on April 5, 2006. (Interesting, isn't it? Almost three months ago, and just recently 'leaked' to the press?)
Dermawan said KPC has not implemented the Cabinet's minutes of meeting back in July 2002 which obliged KPC to divest its shares to local administration. Bumi Resources controls 95% shares of KPC which would be sold to Borneo Lumbung as part of the US$3.2 billion deal.
The problem, central government considered the divestment had been done with the acquisition of KPC by PT Sitrade Nusa Globus from Rio Tinto Plc and Beyond Petroleum (BP).
I'm not sure which one is right, as both sides of the isle have convincing arguments. But the fact that East Kalimantan adm 'announced' the arbitrary suit almost when Bumi and Borneo close the deal has to be something strange. What's happened in the last three years after the transaction of KPC between Bumi & Rio Tinto/BP?
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The newspaper quoted P.D.D.Dermawan, a lawyer from DNC, representing East Kalimantan governor Suwarna (currently detained in a corruption scandal) saying his client filed the arbitrary case to International Center for Settlement of Investment Disputes (ICSID) on April 5, 2006. (Interesting, isn't it? Almost three months ago, and just recently 'leaked' to the press?)
Dermawan said KPC has not implemented the Cabinet's minutes of meeting back in July 2002 which obliged KPC to divest its shares to local administration. Bumi Resources controls 95% shares of KPC which would be sold to Borneo Lumbung as part of the US$3.2 billion deal.
The problem, central government considered the divestment had been done with the acquisition of KPC by PT Sitrade Nusa Globus from Rio Tinto Plc and Beyond Petroleum (BP).
I'm not sure which one is right, as both sides of the isle have convincing arguments. But the fact that East Kalimantan adm 'announced' the arbitrary suit almost when Bumi and Borneo close the deal has to be something strange. What's happened in the last three years after the transaction of KPC between Bumi & Rio Tinto/BP?
Labels: Bumi Resources, COAL
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posted by yosef at 8:28 AM
1 Comments:
This transaction is fishy since the very beginning. The divestment has never been transparent. Now, Bumi would like to get away from it. Let's see if they can do it. Other key is Men ESDM has to approve this transaction which requires a nod from the President. So far, he does not have the guts. He knew something is wrong . And for why it has been quiet for so long, I think you can trace who was in power when this transaction was signed. Cheers.
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