Indonesian Firm Denies Graft in Newmont Deal

Fitri

Mataram, West Nusa Tenggara. The province-owned company set up to buy a 25 percent stake in gold miner Newmont Nusa Tenggara has denied allegations of embezzlement leveled against it by an antigraft watchdog.

Andy Hadiyanto, the chief director of Daerah Maju Bersaing, said on Tuesday that there was no substance to claims by Indonesia Corruption Watch that the company had shortchanged the West Nusa Tenggara provincial administration and the Sumbawa and West Sumbawa district administrations of $39.9 million in dividends from shares.

“I can guarantee that there has been no [embezzlement]. … Everything that was owed to the regional administrations has been transferred directly to them,” he said.

ICW had previously accused DMB of paying out only $7.3 million of the $47.2 million in dividends owed to the three regional administrations.

However, Andy said DMB had paid out some $4 million in dividends in 2010 and $30 million in 2011. The company is also expected to pay out another $12 million in dividends in the coming months, he said.

He also denied ICW’s claim that the divestment of the 24 percent stake by US-based Newmont Mining Corporation to DMB was unlawful because DMB had been set up without the required approval from the district and provincial legislatures.

The divestment issue, in which Newmont is expected to scale back its holding in NNT from 80 percent to 49 percent, is also mired in controversy over the government’s planned purchase of a 7 percent stake.

While the House of Representatives and the Supreme Audit Agency (BPK) say the purchase needs legislative approval, the government claims it can proceed without their consent. The Constitutional Court is hearing the case.