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Newmont to sell off its stake in Batu Hijau mine

Published: 10:02 30 Jun 2016 EDT

Mining trucks
Batu is one of Indonesia’s largest copper deposits.

Newmont Mining Corporation (NYSE:NEM) is to sell its 48.5% interest in PT Newmont Nusa Tenggara, the operator the Batu Hijau open pit copper and gold mine in Indonesia, to PT Amman Mineral Internasional for US$1.3bn.

The mining group said the sale of its stake in the mine operator was in order to lower its debt and fund its highest margin projects.

Nusa Tenggara Mining Corporation - majority owned by Japanese firm Sumitomo - has also agreed to sell its ownership stake to PT Amman.

The deal is expected to close in the third quarter and involves a closing payment of US$920mln and contingent payments of up to $403mln.

The mining group, based in Colorado, operates the Batu Hijau mine on the Island of Sumbawa in Western Indonesia, alongside Sumitomo.

The mine is one of Indonesia’s largest copper deposits and has churned out profits for Newmont since it began commercial operations there back in 2000.

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