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Inco Wants to Settle Sulawesi Rent Row
Muhamad Al Azhari | October 18, 2010

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Although the governor of Southeast Sulawesi has expressed his intention to sue International Nickel Indonesia for years of unpaid rent, the mining company, known as Inco, hopes to settle the dispute out of court, one of its directors said on Monday.

“I am hoping we can sit down together to work out the best solution,” Inco communications director Janus Siahaan said.

“We are open to discussion and we prefer the peaceful way. Either way, we remain committed to investing in the area long term.”

On Sunday, Governor Nur Alam announced plans to take Inco to court for failing to pay rent on a 62,000-hectare nickel field that the company has controlled since 1968.

“I am sure the governor had a good reason to say that,” Janus said, adding that the company felt a lawsuit could be avoided.

Nur claimed Inco did not pay its annual rent of $1 per hectare for over 20 years after taking control of the field. “The company only started to pay the rental cost after it extended its working contract in 1992,” he said.

According to Nur, the first stage of Inco’s working contract was set to end in 1996, but the company extended it in 1992. The second stage of the contract is due to end in 2018.

The governor also accused Inco of failing to contribute to community welfare by not adequately developing the field.

In addition to seeking compensation for the unpaid rent, his administration also plans to ask Inco to release the whole area so that other companies can use it.