* Jokowi govt to have talks with Newmont on contract
* Outgoing government had threatened to end Newmont's
* Newmont has filed for int'l arbitration, declared force
(Recasts with comments from Jokowi's adviser)
By Wilda Asmarini and Fergus Jensen
JAKARTA, July 16 Indonesia's likely next
president signaled a conciliatory approach to the country's
contract dispute with Newmont Mining Corp a day after
the outgoing government threatened to end the U.S. miner's
contract over a legal challenge.
A government of Joko "Jokowi" Widodo, the presidential
front-runner, will seek negotiations with Newmont, a senior
party official said on Wednesday.
The developments represent the latest twist in a six-month
long contract dispute between the Indonesian government on the
one hand and Newmont and fellow U.S. miner Freeport-McMoRan Inc
on the other that has led to a halt in copper shipments
from Southeast Asia's biggest economy.
Earlier this month Newmont filed for international
arbitration over an escalating export tax the government imposed
in January that the company says is in breach of their mining
Newmont also declared force majeure on shipments last month
and said it was forced to halt production at its Batu Hijau
copper mine in eastern Indonesia because it had still not
received an export permit from the government and that its
copper concentrate storage facilities had reached full capacity
in early June.
President Susilo Bambang Yudhoyono's administration
threatened on Tuesday to terminate Newmont's contract if it did
not withdraw the legal challenge.
Advisers to Jokowi, however, said they would use a different
strategy in dealing with Newmont, if the Jakarta governor is
declared the winner of last week's disputed elections.
"We think later we will establish healthy communications,
and sit down together," Darmawan Prasodjo, senior energy advisor
to the Jokowi team, told Reuters in response to questions on how
Jokowi would handle the dispute.
"The spirit of the next government if Jokowi becomes
president will be different to the spirit of the current
government ... the government must be sensitive," he added.
Jokowi, who is leading in reputable quick count polls, would
be appointed president in October pending the outcome of an
election earlier this month.
Jokowi is known for his grass-roots approach to governance
and would settle the Newmont dispute together with stakeholders,
Newmont's Indonesian spokesman was not available for comment
on the matter.
Sacha Winzenreid, mining analyst at PricewaterhouseCoopers,
said neither party had a particularly clear political platform
in relation to mining but that the dispute was expected to be
resolved, regardless of who was in power.
"The last thing the government wants is to go to
international arbitration and lose. They have to hold their
ground now, at least publicly," the analyst said.
Indonesia has faced harsh criticism from mining stakeholders
for the mining export rules that effectively halted $500 million
of monthly mineral ore and concentrate shipments.
Newmont and Freeport, which account for 97 percent of
Indonesia's copper output, have both argued the rules, intended
to force miners to build smelters, conflict with their
Global copper prices, currently not far off
five-month highs, have been underpinned by the disruption to
supplies from Indonesia, and traded near $7,130 per tonne on
(Editing by Richard Pullin and Muralikumar Anantharaman)