Leighton Halts PT Bumi Mines in Indonesia Over DisputeMichelle Yun
Leighton Holdings Ltd., Australia’s largest builder, halted work at two PT Bumi Resources’s mines in Indonesia because of a contract payment dispute.
Leighton’s Thiess unit suspended operations on April 26 of the Senakin and Satui mines in South Kalimantan, which are 70-percent owned by Bumi Resources and the rest held by Tata Power Co., the Sydney-based company said today in a statement. Dileep Srivastava, a director at Jakarta-based coal company, didn’t respond to two e-mails seeking comment.
Bumi Resources, Indonesia’s biggest coal producer, said last month it swung to a net loss of $666.2 million in 2012 amid lower coal prices. Leighton said it’s pursuing the mining company for payments to which it’s entitled under contracts, though it didn’t disclose the amount.
“The group remains confident that work at the Senakin and Satui mines will return to production following a satisfactory resolution,” Leighton said. The dispute isn’t expected to have a material effect on the company’s results, it said.
Leighton shares dropped 4.9 percent to A$17.59 at the close in Sydney. Shares of Bumi Resources were unchanged at 660 rupiah in Jakarta trading as of 2:04 p.m. local time.
Leighton’s contracted work at the Kaltim Prima Coal project, 65-percent owned by Bumi, continues uninterrupted, it said.
London-listed Bumi Plc, which owns 29 percent of Bumi Resources, is working to separate from the coal miner and its founders, the Bakrie Group, after shareholders in February defeated an attempt by Nathaniel Rothschild to take control of Bumi Plc’s board.
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