BUSINESS BRIEFS
MACROECONOMY
Room for October Rate Cut – BI
Easing inflationary pressure in September will boost the likelihood of a cut in the benchmark Bank Indonesia (BI) one-month rate in October, central bank Deputy Governor Hartadi Sarwano said Monday (25/9/06).
There is room for the inflation rate to ease in September "because there are not big challenges in the economic situation," Sarwano was quoted as saying by Dow Jones Newswires.  "There's room for the Bank Indonesia rate to go down from this level."
BI Governor Burhanuddin Abdullah said the previous week that any movement in October in the benchmark rate, currently at 11.25%, would hinge on September consumer price index data.
The Central Bureau of Statistics will issue August trade and September CPI data on October 2 while BI's Board of Governors will decide on any benchmark rate moves at a regular monthly meeting on October 5.
Sarwano said Indonesia's macroeconomic situation is "on track" and would make the central bank's end-2006 on-year CPI forecast achievable.
The impact of the annual upsurge in consumer spending during the Islamic fasting month of Ramadhan, which began September 24, won't derail official inflation forecasts, he said.
"There are seasonal conditions like Ramadhan, Idul Fitri and Christmas, but the impact of seasonal conditions isn't big so the central bank's inflation target can be achieved."
Short-Term Inflows Total $7b - BI
Current short-term investment inflows into Indonesia's economy total about $7 billion, Bank Indonesia (BI) Deputy Governor Aslim Tadjuddin said Monday (25/9/06).
That figure included Rp10 trillion invested in BI Certificates (SBIs), Rp56 trillion in treasury bonds and the remainder in the country's equity markets, Tadjuddin was quoted as saying by Dow Jones Newswires.
President Susilo Bambang Yudhoyono cautioned in his annual budget speech in August that policy-makers needed to carefully manage those inflows to prevent "economic turbulence" created by investor sentiment swings.
Volatility resulting from a turn in investor sentiment against riskier emerging markets caused a 5.5% decline in the value of the rupiah to the dollar in May.
Meanwhile, the Finance Department sold Rp125 billion worth of treasury bonds at its regular debt auction with the weighted average yield coming in at 11.3%, XFN-Asia reported on Tuesday (26/9/06).
The paper sold comes from the reopening of an earlier bond series, the FR0040, which matures in 2025 and carries a coupon of 11%.  It replaces two older T-bond series that were to mature in 2007 and 2009, treasury director Mulia Nasution said.
"Bids were small because the market is bearish," he said, noting that the bids totaled just Rp300 billion.
INVESTMENT
Govt. to Offer 17m Ha of Forest Concessions
Indonesia plans to offer some 17 million hectares of lapsed or unused forest concessions to investors interested in developing timber and farming estates, Forestry Minister MS Kaban said Thursday (28/9/06).
"We will offer nine million hectares for timber estates from forest concessions, which are no longer productive," he was quoted as saying by Agence France-Presse.
He said the move aims to boost timber production and open up more job opportunities, with plots to be given out for management for a period of 100 years, which would allow some 15 harvests of trees such as acacias.
Some Rp9.7 trillion ($1 billion) from the government's reforestation fund had been allocated to prepare the land on Sumatra and Sulawesi.
Institutions to manage the funds would first need to be set up and could start work in November, he said.  He did not give details on how the concessions would be determined or under what terms.
Agriculture Minister Anton Apriyantono, speaking on the same occasion, said the government is also preparing 8.2 million hectares of land for plantations and agriculture, particularly for palm oil and sugar cane.  He said the land had been cleared some time ago.
The head of the land registry agency, Joyo Winoto, said that about three million hectares would be allotted for palm oil.
Bakrie to Build Infrastructure Projects
Publicly listed steel pipe maker PT Bakrie & Brothers said it will set aside $4.81 billion to finance nine infrastructure projects it hopes to build until 2010.
Three of the nine projects are toll road projects in Java, which will cost $810 million and will be offered in the Infrastructure Summit in November, company secretary Juliandus Tobing said, according to Antara.
The three toll road projects are Kunciran-Serpong, to cost $190 million; Cimanggis-Cibitung, $340 million, and Serpong-Cinere at $280 million, Tobing said.
Bakrie & Brothers has already been awarded the Tanjung Jati A power project, to cost $1.4 billion and a gas pipeline project spanning the sea between East Kalimantan and Central Java, to cost $1.26 billion.

SOEs
Dirgantara Signs Contracts Worth Rp125.4b
State-owned aircraft manufacturer, PT Dirgantara Indonesia has signed three new contracts with the Defense Department for the supply of one aircraft and three helicopters to the Navy and Army.
The company said Monday (25/9/06) that the contracts, worth up to Rp125.4 billion ($13.6 million), were for the supply of an NC212-200 aircraft, two NBO-105 helicopters and an NBELL-412 helicopter to the Defense Department, The Jakarta Post reported.
PRIVATE SECTOR
Textile Producers Call for FTA with US
The Association of Textile Producers (API) has urged the government to push for a free trade agreement (FTA) with the US.
The call came after the two countries signed a memorandum of understanding to jointly fight illegal transshipments through Indonesia of third country textiles. "We hope the signing of the agreement will lead to the signing of an FTA," API secretary Ernovian G Ismy was quoted as saying by Antara.
Trade Minister Mari Pangestu signed the agreement with US Trade Representative Susan Schwab to work together to stop the transshipment of textiles from countries without access to the US market through Indonesia.
"Transshipments have jeopardized Indonesia's legitimate textile and apparel exports by taking up market space in the United States," Schwab said at a ceremony to sign the pact.
Pangestu said the textile accord was part of a "building block" approach to increasing trade ties with the US.
Indonesian exports of textiles and garments to the US have continued to increase -- up 26.7% to $2.17 billion in the first seven months of the year from the same period last year.
Samsung Optimistic on Boosting Sales
PT Samsung Electronics Indonesia said it is optimistic that it can reach its target to boost sales of its consumer electronics in the country by 25% this year despite the economic slowdown.
Marketing director of the company Stefanus Indrayana said that in the first eight months of the year, sales of its household electronics grew by 20% on average, Antara reported on Thursday (28/9/06)
Indrayana predicted the market condition will improve in the last quarter of this year, with total sales this year more or less the same as last year.
He acknowledged that sales in the first eight months of the year fell compared with the same period last year, but increases were recorded for certain products.
BANKS
Clearing System to Help Track Illegal Transactions
The National Clearing System designed to save more accurate banking information can help investigators uncover illegal bank transactions, Bank Indonesia (BI) Deputy Governor Maulana Ibrahim said recently.
The system, which saves information on customer data and time of transfers, the recipients of money transfers, as well as operator identity, has enabled the central bank to have more complete data on transactions, Ibrahim said, according to Antara.
Highly confidential computer identity and data as well as operator passwords are registered at BI's main server.  "With the data, BI can give a better contribution to investigators in their efforts to uncover funds suspected to come from illegal transactions," he said.
Ibrahim was talking after a ceremony dedicating the National Clearing System in Medan, Padang (West Sumatra), Banjarmasin (South Kalimantan), Sibolga (North Sumatra), Batam (Riau), Pekanbaru (Riau), Pontianak (West Kalimantan), Kendari (Southeast Sulawesi) and Palu (Central Sulawesi).
The nine BI regional offices are the latest to be connected to the system, by which all BI regional offices become integrated under a clearing system.
Ibrahim said data on transactions would be provided to investigators upon request, or to the state under the prevailing regulations.
ABN Amro to Open Shariah Unit
ABN Amro NV said it plans to open a shariah unit in Indonesia in the first half of 2007, its country executive, Henk G Mulder said.
"ABN Amro already has shariah units in Dubai and Pakistan and we hope to open one in Indonesia," Mulder was quoted as saying recently by Antara.
POWER
Bukit Asam to Complete 2 Plants in 2010
State-owned coal mining company PT Tambang Batubara Bukit Asam said it will start building two coal-fired power plants in South Sumatra.
The company will build a 200-MW plant in Lahat regency, expected to be completed by 2009, and a 2,400-MW plant in Muara Enim regency, expected to be completed by 2010, company manager Eko Hadianto was quoted as saying by Antara.
Bukit Asam will supply the coal.  The Lahat plant will need about 1.5 million tons of coal a year.
OIL AND GAS
Govt. to Spend $1.4b for Bio-diesel in 2007
The government will set aside Rp13 trillion ($1.42 billion) from its 2007 state budget to help spur private sector initiatives aimed at hitting an overall bio-diesel output target of 250,000 to 300,000 metric tons a year, an industry official said Monday (25/9/06).
Such funding would be a first for the government, which has never allocated any part of its budget for the bio-diesel sector.
The budgetary allocation will be broken down into Rp10 trillion in infrastructure subsidies, Rp2 trillion in subsidies for seed purchases, and Rp1 trillion in interest breaks offered to bio-fuel investors, the chief of the government-backed National Bio-fuel Promotion team, Alhilal Hamdi, said, according to Dow Jones Newswires.
Hamdi said the government next year would seek a further Rp15 trillion to Rp20 trillion ($1.64 billion to $2.2 billion) from banks for bio-fuel development.
President Susilo Bambang Yudhoyono said earlier this year that the country ought to prioritize development of bio-fuels -- blends of vegetable oil and fossil fuel -- as a potential solution to many economic and social problems.
Meanwhile, air pollution levels are high in many of the country's urban hubs, and bio-fuels' cleaner emissions are seen as a way of alleviating this problem.  The government sees increased need for bio-fuel feedstocks as a source of job creation, which could help to reduce poverty and unemployment in the sprawling archipelagic nation.
Tatang H Soerawidjaja, chairman of the Indonesian Bio-diesel Forum, said recently that the government would offer Rp10 trillion ($1.1 billion) in subsidies for developers of transport infrastructure, such as roads and ports to ensure a ready supply of bio-fuel feedstocks from remote plantation areas.
Soerawidjaja said the government will also offer companies investing in the bio-fuels sector Rp1 trillion in "interest incentives", whereby the government subsidizes part of those companies' interest repayments on bank loans used to fund their investments.
Hamdi said some 19.7 million hectares of plantation area in Indonesia are suitable for the propagation of bio-fuel feedstocks such as palm oil, jatropha and cassava.
While Indonesia's fast-growing bio-fuel sector has so far focused primarily on bio-diesel, which can be burned in some diesel engines, the country could see construction start on its first ethanol plant at the end of next year, he said.  Ethanol is a bio-fuel that can be used in some gasoline-burning cars.
A Pertamina spokesman said recently that it is researching ethanol development in Indonesia, but that few available car models in Indonesia can run on the fuel.  Pertamina already sells a 5% bio-diesel blend in many of its gasoline service stations in Jakarta.
Meanwhile, executive chairman of the Indonesian Palm Oil Association, Derom Bangun, said on Monday (25/9/06) that bio-diesel projects would not be hit by the fall in crude oil prices as investors feel the current dip is temporary and prices will bounce back.
"Even if crude oil prices go down for a while, people believe after one or two years they will again go up," he said.  Developments in bio-diesel will continue and investments on new plants will not be hampered.  It is not the government but private investors who will decide when and where to build bio-diesel plants."
Bangun said Indonesia expects six new bio-diesel plants to be in operation by 2007, and about 500,000 tons of bio-diesel to be produced from three of these plants by early next year.  He estimated about 600,000 tons of palm oil would be used for bio-diesel production in Indonesia in 2007.
Indonesia to Halve LNG to Japan
Indonesia has notified Japanese companies that it intends to reduce exports of liquefied natural gas (LNG) to Japan by as early as 2010, sources said Thursday (28/9/06), according to The Daily Yomiuri.
The two sides have already entered into negotiations on the reduction plan, which will be implemented when current long-term export contracts expire, the sources said.
LNG imports from the Bontang plant in Kalimantan, which account for more than 90% of overall LNG imports from Indonesia, will be reduced dramatically, according to the sources. 
Japanese companies such as Tokyo Gas Co and Kansai Electric Power Co, which signed long-term deals to import a total of 14.54 million tons of LNG annually from the plant, will see contracts on about 12 million tons expire from 2010 through 2011.
2006 Fuel Consumption Lower than Predicted
Indonesia expects to consume 37.9 million kiloliters (kl) (238 million barrels) of subsidized fuel this year, lower than previous estimates of 41.6 million kl, due to lower domestic demand, an official at the state oil firm, PT Pertamina said on Monday (25/9/06).
"Domestic consumption is lower than earlier predicted because the government raised oil product prices last October," the official, who declined to be identified, told Reuters.
The official said consumption of subsidized gasoline is likely to fall slightly to 17 million kl from 17.1 million kl and diesel oil is seen down to 11 million kl from 14.5 million kl estimated earlier.  Subsidized kerosene consumption is likely to be slightly lower at 9.9 million kl compared with an earlier estimate of 10 million.
Govt. to Open 40-50 Blocks
The government plans to invite interested companies for direct negotiations over 40 to 50 exploration blocks in the country's frontier areas next year, a mines and energy official said Thursday (28/9/06).
While Indonesia has embraced the open tender system for awarding exploration blocks, it occasionally still parcels out a few based on direct negotiations with the interested parties.
"Major oil companies, including ExxonMobil, Chevron, Conoco and Total, are interested in exploring our oil and gas blocks in frontier and deep sea areas.  They are difficult areas, but may be interesting for them," Priyono said, according to Platts Commodity News.
Most of the challenging acreages are located in southern Java, western Sumatra, Kalimantan, Sulawesi and Nusa Tenggara, Priyono said.
Under Indonesia's direct-offer mechanism, a company interested in a block that has not been offered for open bidding, can take its interest to the government.  After discussions with the company, the government opens up the block for a limited period to seek competitive offers.  The most competitive offer wins. If there are no rivals, the original company wins the block.
ExxonMobil, Total, Chevron, ConocoPhillips, Malaysia's Petronas, Italy's Eni, China's CNOOC and Amerada Hess of the US have expressed interest in some of the blocks, Priyono said earlier.
Genting Unit Finds Gas in Natuna Block
Genting Oil & Gas Ltd, a unit of Malaysia's Genting Bhd, has discovered gas with the successful completion of the drilling of exploration well Anambas-1X in West Natuna, reported Dow Jones Newswires. 
Both dry gas and gas condensate were found, the company said in statement Monday (25/9/06).  Tests found a gas flow of 15.6 million cubic ft of gas a day and a condensate flow of 488 barrels of condensate a day.  Drilling commenced July 9.
Further evaluation of the results will be taken to determine the reserve size, development potential and commercial viability of the discovery.
The Anambas Block is 100% operated by Genting's Oil & Gas' wholly owned unit Sanyen Oil & Gas Pte Ltd under a production-sharing contract with upstream oil and gas regulator BP Migas.
Genting's oil and gas division will shortly begin the drilling of two more exploratory wells, 90 km to the north of Anambas-1X, in the oil-rich Northwest Natuna Block.
MINING
BDI Mining Finds Rare Blue Diamond
BDI Mining Corp announced on Monday (25/9/06) that it has recovered a rare 3.02 carat blue diamond from its Cempaka alluvial diamond mine in southeast Kalimantan, Dow Jones Newswires reported.
The company recovered the intense-blue diamond from its Indonesian mining operations, where more than 50,000 carats of gem-quality diamonds have been recovered since mining operations began in March 2005.  Blue diamonds, along with green and red stones, are considered to be among the rarest and most valuable of all diamonds.
"The recovery of such a stone is very much a highlight for the mine and the company,” BDI Mining chairman, David Lenigas said. 
"Given the intense color of the stone and therefore its rarity, we have decided to christen the diamond 'Chelsea Blue',” he said, adding that it will be sold by private tender within the coming months. 
The discovery of the Chelsea Blue comes at a time when the expansion of the Cempaka operations are progressing as planned.  The processing facilities upgrade is scheduled for completion within the next two weeks and the initial mining expansion phase of the Cempaka main channel is well advanced.
AFX reported that BDI Mining narrowed its pretax loss to $2.22 million in the first half of the year from $3.38 million a year earlier.  The company said average monthly recoveries of 3,500-4,000 carats prove that the operational systems adopted at Cempaka are “extremely effective in the difficult mining conditions encountered locally and provide us with the confidence to move forward as we seek to develop the mine.”
Thai Banpu to Improve Water Treatment
Thailand's largest coal miner, Banpu PCL, said Thursday (28/9/06) improvements in water treatment at its Trubaindo mine in Indonesia following complaints would not disrupt production.
Banpu said in a statement it was told by Indonesian authorities to improve the quality of water in one of the 10 ponds at the mine after an investigation following complaints of pollution indicated high acid levels.
The investigation showed the water quality in most of the mine's 10 ponds complied with industry regulations and the Trubaindo mine is expected to complete improvements and report back to the authorities shortly, it said, according to Reuters.
Banpu has six mines in Indonesia, two in China and two in Thailand and has said it aims to raise sales to 21 million tons this year from 17 million tons last year.
Local Govt. May Buy 3% Newmont Stake
West Nusa Tenggara’s West Sumbawa regency can proceed to acquire a 3% stake in Newmont Mining unit PT Newmont Nusa Tenggara after the central government decided not to buy it, a government official said.
Finance Minister Sri Mulyani Indrawati has confirmed that the central government will not proceed with the purchase, the Mines and Energy Department’s Director General for Geology and Mineral Resources, Simong Sembiring, said, according to XFN-Asia.
Under the terms of a contract struck between the government and the Newmont unit, the foreign owners must gradually reduce their holding, starting from the sixth year of operation, to 49% by the end of the tenth year.  The first reduction has to take place this year.
Newmont Nusa Tenggara is an 80%-20% joint venture between Nusa Tenggara Partnership and local firm PT Pukuafu Indah.  Nusa Tenggara Partnership is 56.25% owned by Newmont Indonesia Ltd and 43.75% by Sumitomo.
Separately, Newmont Nusa Tenggara spokesman Kasan Mulyono said the firm paid the government $101 million last year in taxes, non-taxes and royalties.  He said the firm produced 550 million pounds of copper and 500,000 oz of gold last year from its Batu Hijau mine on Sumbawa.
and investments on new plants will not be hampered.  It is not the government but private investors who will decide when and where to build bio-diesel plants."
Bangun said Indonesia expects six new bio-diesel plants to be in operation by 2007, and about 500,000 tons of bio-diesel to be produced from three of these plants by early next year.  He estimated about 600,000 tons of palm oil would be used for bio-diesel production in Indonesia in 2007.
Indonesia to Halve LNG to Japan
Indonesia has notified Japanese companies that it intends to reduce exports of liquefied natural gas (LNG) to Japan by as early as 2010, sources said Thursday (28/9/06), according to The Daily Yomiuri.
The two sides have already entered into negotiations on the reduction plan, which will be implemented when current long-term export contracts expire, the sources said.
LNG imports from the Bontang plant in Kalimantan, which account for more than 90% of overall LNG imports from Indonesia, will be reduced dramatically, according to the sources. 
Japanese companies such as Tokyo Gas Co and Kansai Electric Power Co, which signed long-term deals to import a total of 14.54 million tons of LNG annually from the plant, will see contracts on about 12 million tons expire from 2010 through 2011.
2006 Fuel Consumption Lower than Predicted
Indonesia expects to consume 37.9 million kiloliters (kl) (238 million barrels) of subsidized fuel this year, lower than previous estimates of 41.6 million kl, due to lower domestic demand, an official at the state oil firm, PT Pertamina said on Monday (25/9/06).
"Domestic consumption is lower than earlier predicted because the government raised oil product prices last October," the official, who declined to be identified, told Reuters.
The official said consumption of subsidized gasoline is likely to fall slightly to 17 million kl from 17.1 million kl and diesel oil is seen down to 11 million kl from 14.5 million kl estimated earlier.  Subsidized kerosene consumption is likely to be slightly lower at 9.9 million kl compared with an earlier estimate of 10 million.
Govt. to Open 40-50 Blocks
The government plans to invite interested companies for direct negotiations over 40 to 50 exploration blocks in the country's frontier areas next year, a mines and energy official said Thursday (28/9/06).
While Indonesia has embraced the open tender system for awarding exploration blocks, it occasionally still parcels out a few based on direct negotiations with the interested parties.
"Major oil companies, including ExxonMobil, Chevron, Conoco and Total, are interested in exploring our oil and gas blocks in frontier and deep sea areas.  They are difficult areas, but may be interesting for them," Priyono said, according to Platts Commodity News.
Most of the challenging acreages are located in southern Java, western Sumatra, Kalimantan, Sulawesi and Nusa Tenggara, Priyono said.
Under Indonesia's direct-offer mechanism, a company interested in a block that has not been offered for open bidding, can take its interest to the government.  After discussions with the company, the government opens up the block for a limited period to seek competitive offers.  The most competitive offer wins. If there are no rivals, the original company wins the block.
ExxonMobil, Total, Chevron, ConocoPhillips, Malaysia's Petronas, Italy's Eni, China's CNOOC and Amerada Hess of the US have expressed interest in some of the blocks, Priyono said earlier.
Genting Unit Finds Gas in Natuna Block
Genting Oil & Gas Ltd, a unit of Malaysia's Genting Bhd, has discovered gas with the successful completion of the drilling of exploration well Anambas-1X in West Natuna, reported Dow Jones Newswires. 
Both dry gas and gas condensate were found, the company said in statement Monday (25/9/06).  Tests found a gas flow of 15.6 million cubic ft of gas a day and a condensate flow of 488 barrels of condensate a day.  Drilling commenced July 9.
Further evaluation of the results will be taken to determine the reserve size, development potential and commercial viability of the discovery.
The Anambas Block is 100% operated by Genting's Oil & Gas' wholly owned unit Sanyen Oil & Gas Pte Ltd under a production-sharing contract with upstream oil and gas regulator BP Migas.
Genting's oil and gas division will shortly begin the drilling of two more exploratory wells, 90 km to the north of Anambas-1X, in the oil-rich Northwest Natuna Block.
MINING
BDI Mining Finds Rare Blue Diamond
BDI Mining Corp announced on Monday (25/9/06) that it has recovered a rare 3.02 carat blue diamond from its Cempaka alluvial diamond mine in southeast Kalimantan, Dow Jones Newswires reported.
The company recovered the intense-blue diamond from its Indonesian mining operations, where more than 50,000 carats of gem-quality diamonds have been recovered since mining operations began in March 2005.  Blue diamonds, along with green and red stones, are considered to be among the rarest and most valuable of all diamonds.
"The recovery of such a stone is very much a highlight for the mine and the company,” BDI Mining chairman, David Lenigas said. 
"Given the intense color of the stone and therefore its rarity, we have decided to christen the diamond 'Chelsea Blue',” he said, adding that it will be sold by private tender within the coming months. 
The discovery of the Chelsea Blue comes at a time when the expansion of the Cempaka operations are progressing as planned.  The processing facilities upgrade is scheduled for completion within the next two weeks and the initial mining expansion phase of the Cempaka main channel is well advanced.
AFX reported that BDI Mining narrowed its pretax loss to $2.22 million in the first half of the year from $3.38 million a year earlier.  The company said average monthly recoveries of 3,500-4,000 carats prove that the operational systems adopted at Cempaka are “extremely effective in the difficult mining conditions encountered locally and provide us with the confidence to move forward as we seek to develop the mine.”
Thai Banpu to Improve Water Treatment
Thailand's largest coal miner, Banpu PCL, said Thursday (28/9/06) improvements in water treatment at its Trubaindo mine in Indonesia following complaints would not disrupt production.
Banpu said in a statement it was told by Indonesian authorities to improve the quality of water in one of the 10 ponds at the mine after an investigation following complaints of pollution indicated high acid levels.
The investigation showed the water quality in most of the mine's 10 ponds complied with industry regulations and the Trubaindo mine is expected to complete improvements and report back to the authorities shortly, it said, according to Reuters.
Banpu has six mines in Indonesia, two in China and two in Thailand and has said it aims to raise sales to 21 million tons this year from 17 million tons last year.
Local Govt. May Buy 3% Newmont Stake
West Nusa Tenggara’s West Sumbawa regency can proceed to acquire a 3% stake in Newmont Mining unit PT Newmont Nusa Tenggara after the central government decided not to buy it, a government official said.
Finance Minister Sri Mulyani Indrawati has confirmed that the central government will not proceed with the purchase, the Mines and Energy Department’s Director General for Geology and Mineral Resources, Simong Sembiring, said, according to XFN-Asia.
Under the terms of a contract struck between the government and the Newmont unit, the foreign owners must gradually reduce their holding, starting from the sixth year of operation, to 49% by the end of the tenth year.  The first reduction has to take place this year.
Newmont Nusa Tenggara is an 80%-20% joint venture between Nusa Tenggara Partnership and local firm PT Pukuafu Indah.  Nusa Tenggara Partnership is 56.25% owned by Newmont Indonesia Ltd and 43.75% by Sumitomo.
Separately, Newmont Nusa Tenggara spokesman Kasan Mulyono said the firm paid the government $101 million last year in taxes, non-taxes and royalties.  He said the firm produced 550 million pounds of copper and 500,000 oz of gold last year from its Batu Hijau mine on Sumbawa.