BlackGold says Indonesian power plant graft scandal 'extraneous to the group'; shares tumble

SINGAPORE - Catalist-listed coal company BlackGold Natural Resources moved to distance itself from a political bribery scandal in Indonesia in a "clarification announcement" on the Singapore Exchange website on Monday morning (July 16).

BlackGold's board called allegations of corruption over a power plant project in Riau province "extraneous to the group as the directors and management were not, and are not involved whatsoever, in the transaction mentioned".

It added that there is no impact on BlackGold's ongoing mining operations: "The group's business activities, including coal deliveries to its customers, are proceeding as normal."

Indonesia's anti-graft body, the Komisi Pemberantasan Korupsi (KPK), detained lawmaker Eni Maulani Saragih over the weekend for alleged corruption. She has been accused of taking money from one Johanes Budisutrisno Kotjo, who was described in media reports as a BlackGold shareholder.

BlackGold said in its latest announcement that Mr Kotjo has not been a consultant to the group since June 2018. Mr Kotjo, who had a 4.3 per cent stake in the company as of August 2017, was appointed to that role in March 2016.

The company struck a deal in 2017 to build and run a coal-fired power plant, as part of a consortium, in what was dubbed the Riau-1 project. "Up to the date of this announcement, negotiations on the Riau-1 project have been progressing as intended," BlackGold said on Monday.

It added that the board "will provide further updates when there are material developments on this matter".

BlackGold was top of the actives list on a volume of more than 22.1 million shares, as at 11.09am. The counter had tumbled by 1.6 cents, or 39 per cent, to 2.5 cents.