Churchill Mining has asked the Indonesian government to intervene in the dispute over the ownership of the East Kutai coal prospect or else it will seek international arbitration.

In a letter to the government, Churchill claims it has been subject to unjust and unlawful actions by a number of parties including the East Kutai Regency and other Indonesian Government ministries.

It said that “Various Indonesian parties, both government and private, seeking to expropriate its legitimate rights to develop the East Kutai coal deposit are in direct breach of both Indonesia's investment laws and Indonesia's obligations under a number of international investment treaties.”

Churchill wants cooperation from senior government officials to help solve the dispute, but if “amicable resolution” cannot be achieved the firm said it will initiate international arbitration against Indonesia.

The East Kutai project is a huge resource with a JORC compliant estimate of 2.7 billion tonnes of coal and a pre-tax net present value of USD 1.8 billion.

Churchill acquired the licences in 2007 through an acquisition of a 75% stake in Indonesian group Ridlatama after the previous owner Nusantra failed to extend the licences in 2006 and 2007.

(Sourced from www.proactiveinvestors.co.uk)