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Darco again rejected by West Java government over re-negotiation of Indonesia project
DARCO Water Technologies said on Friday that despite further discussions, the West Java government has reiterated that it is not agreeable to a re-negotiation of the terms of the cooperation agreement for the group’s proposed Indonesia waste-management project.
Darco took a 75 per cent stake in Panghegar Energy Indonesia (PEI) this year. PEI in turn owns 80 per cent of Jabar Bersih Lestari (JBL), which inked the agreement with the government to provide waste-management services in certain parts of the province.
Darco's third-party consultant, who was engaged to perform due diligence, had recommended that certain terms of the agreement be renegotiated so that the project can be viable. Darco said on June 25 that the West Java government said it is not agreeable to a renegotiation and that JBL should commence operation of the project.
The group said on Friday that is deliberating its next steps and is expected to come to a decision in a week. This includes a decision on whether the reversal option will be exercised.
Darco shares were flat at S$0.16 on Friday.