March 26, 2014 / 5:35 AM / 4 years ago

Newmont cuts output at Indonesia mine by 70 pct after tax spat -ministry

JAKARTA, March 26 (Reuters) - Newmont Mining Corp has cut production at its Indonesian copper and gold mine by 70 percent, a mining ministry official said on Wednesday, as a dispute over a newly introduced export tax has dragged on for more than two months.

Indonesia implemented a ban on mineral ore exports and introduced an escalating export tax for concentrates in January to encourage mineral processing domestically in order to increase the value of exports. However, the new rules have left the mining sector in turmoil.

“Newmont’s production until today is only 30 percent,” the government’s mineral enterprise director, Dede Suhendra, told reporters. He added that Newmont was yet to resume exports since January, and was now only sending concentrates to Indonesia’s sole copper smelter at Gresik.

Newmont could not be reached immediately for comment.

The company, which runs the Batu Hijau mine in Indonesia and was forecast to produce between 75-90 million pounds of copper last year, said last month that it expects normal mining operations to continue at the mine in Indonesia for at least the next two months. (Reporting by Wilda Asmarini; Writing by Michael Taylor; Editing by Muralikumar Anantharaman)

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