CIMB Mining contracting - new decree - foreign companies prohib...

Details on the implementing regulations on mining contracting will be outlined in the upcoming ministerial decrees, should be out soon.
But, the umbrella law mining Law no.4/2009 stated the followings for mining-contracting:



~ On restriction using affiliates, I think it's not a big issue as currently there is only very limited excess capacity, if any, in contract-mining sector judging from the companies' production growth outlook over the next 3-4 years and the 6-8 months lag time in ordering machineries. Coal producers are no worried about this, all of them view they can justify using their affiliates.
~ On the foreign contractors, it's more tricky. I spoke to Leighton which claimed they have been trying to lobby the government over this particular point, but apparently failed. So, foreign mining contractors (Leighton and Thiess) are likely to be given some transition period (probably 2-3 years) to partner with local party (or be up for sale to local parties) or to be listed on the JSX. At this stage, listing is more feasible for them.