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Tuesday, 27 December 11
MINERS MAKE CASE FOR RESUMING CONTRACT NEGOTIATIONS - THE JAKARTA POST
The Jakarta Post reported that, problems with the renegotiation of mining contracts in the country are far from over, as agreements on several crucial issues are still yet to be found.
The government remains adamant that it will not compromise on its intention to ramp up state revenues by increasing royalties, while miners on the other hand insist that some points in the 2009 minerals and coal law are “irrational” and may create uncertainty in terms of the outcome of their investments.
The Indonesian Mining Association (IMA) revealed that renegotiations had stalled due to three major issues: the size of mining areas, state revenues and contract extensions.
In a bid to make progress on the stagnant talks between the government and miners, the association proposed solutions to the three issues based on what it saw as fair for both parties. With the proposals, it expected that deals would be made, which would foster an air of certainty in relation to operations.
On the issue of state revenues, the association claimed that it was hard for mining companies to adjust the amount of royalties to the level set by the government in the 2003 regulation on tariffs for non-tax revenues for the energy and mineral resources sector (3.75 percent of sales for gold, 3.25 percent for silver and 4 percent for copper).
“If the government wants to raise royalties, it also has to think about other financial obligations paid by companies, such as the corporate income tax, the amount of which is still 35 percent even though the 2008 law on income tax revised it to 25 percent,” said Syahrir AB, an executive director of the IMA, in Jakarta on Monday.
The government could not force mining companies to pay higher royalties without adjusting its other financial obligations because such economic burdens would reduce the profitability of their projects, he explained.
If the goal was to raise state revenues from the mining sector, he suggested that the government apply a threshold for mining companies’ profits. For example, if a company made a profit margin of more than 25 percent due to the soaring prices of commodities, the government could apply an additional tax, he added.
The second suggestion was related to the size of mining areas. The association said most mining companies needed at least 70,000 hectares to make a mining project “economical”. However, the 2009 law on minerals and coal determined that the maximum size for mineral mining was 25,000 hectares, with coal mining at 15,000 hectares.
“In our last meeting with the government, it understood our reasons. The government agreed that the size of an area granted to a company would be judged based on the long-term plan it proposed to the government,” Syahrir reported.
That model requires the Energy and Mineral Resources Ministry to have the human resources to review the plan and judge whether the size of area proposed by a company is reasonable or not. If the reviewers say that the proposal is unreasonable, the government can grant the permit for a smaller area.
The third suggestion was about the contract extension. Currently, mining companies can extend the contract by “two times 10 years”, but the authority to grant approval for the extension is in the hands of the head of regions by issuing mining permits. The association deems that the model creates uncertainty over the future of mining projects. It suggests that the contract extension clause is included into mining contracts (KK) and contracts of work (PKP2B).
The director general for minerals and coal at the Energy and Mineral Resources Ministry, Thamrin Sihite, said that out of 42 mining contract holders and 76 contracts of work, there were companies that agreed to all renegotiation points, and some that partially agreed and disagreed.
“About the suggestion in relation to the size of area, the government will review it first, if the proposal is in line with the government vision, we may approve it,” he said over the phone.
However, he reminded that renegotiations had to be looked at on case by case basis as each company had different problems.
IMA proposals:
•The implementation of a profit threshold to allow the government to tax mining companies if the latter’s profit margins exceed the threshold.
•Determine the mining area based on the profitability of each mining project. The IMA estimates that a company needs at least 70,000 hectares to make a project profitable.
•Contract extensions have to be included into mining contracts (KK) and contracts of work (PKP2B) to create certainty.
Source: The Jakarta Post
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Wednesday, 31 January 24
CHINA'S INNER MONGOLIA COAL OUTPUT HIT 1.21B TONS IN 2023 - XINHUA
North China’s Inner Mongolia autonomous region churned out 1.21 billion tons of coal in 2023 as it strives to guarantee the country’s e ...
Wednesday, 31 January 24
GAS EXPORTS COST U.S. CONSUMERS MORE THAN $100 BILLION OVER 16-MONTH PERIOD - IEEFA
Limited Demand Growth Could Dampen the Dry Bulk Market in the Coming Months BIMCOStarting in late 2021—before its invasion of Ukraine—R ...
Tuesday, 30 January 24
LIMITED DEMAND GROWTH COULD DAMPEN THE DRY BULK MARKET IN THE COMING MONTHS - BIMCO
Demand
In our base scenario, we expect cargo demand to grow by 0-1% in 2024 and 0.5-1.5% in 2025. This is a 0.5 percentage point reduction for ...
Friday, 26 January 24
RED SEA DIVERSIONS ADD NEARLY A MILLION DOLLARS PER VOYAGE TO SHIPPING COSTS WHILE DOUBLING TRANSIT TIME - LSEG
The incremental costs of diverting a tanker from Asia to NW Europe via the Cape of Good Hope is accounting for an extra $932,905 USD per voyage whi ...
Friday, 26 January 24
HARD COAL GUARDIAN ANGEL OF THE ENERGY SUPPLY - GERMANY COAL IMPORTERS ASSOCIATION
- No security of supply without hard coal
- The Substitute Power Plant Provision Act (EKBG) must be extended
- Higher grid fees due to the ...
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- Semirara Mining Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Posco Energy - South Korea
- MS Steel International - UAE
- Commonwealth Bank - Australia
- Electricity Generating Authority of Thailand
- Riau Bara Harum - Indonesia
- Manunggal Multi Energi - Indonesia
- Mercator Lines Limited - India
- Aditya Birla Group - India
- Sree Jayajothi Cements Limited - India
- Bukit Baiduri Energy - Indonesia
- Africa Commodities Group - South Africa
- Rashtriya Ispat Nigam Limited - India
- PNOC Exploration Corporation - Philippines
- Xindia Steels Limited - India
- Essar Steel Hazira Ltd - India
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Thiess Contractors Indonesia
- Kapuas Tunggal Persada - Indonesia
- IEA Clean Coal Centre - UK
- Uttam Galva Steels Limited - India
- Petron Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Indonesian Coal Mining Association
- Larsen & Toubro Limited - India
- New Zealand Coal & Carbon
- Medco Energi Mining Internasional
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Sidhee Cement - India
- SN Aboitiz Power Inc, Philippines
- Parliament of New Zealand
- Star Paper Mills Limited - India
- GAC Shipping (India) Pvt Ltd
- Chettinad Cement Corporation Ltd - India
- White Energy Company Limited
- The State Trading Corporation of India Ltd
- Siam City Cement - Thailand
- Ministry of Transport, Egypt
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- Baramulti Group, Indonesia
- South Luzon Thermal Energy Corporation
- Edison Trading Spa - Italy
- Ministry of Finance - Indonesia
- Meenaskhi Energy Private Limited - India
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Bangladesh Power Developement Board
- Kepco SPC Power Corporation, Philippines
- Wilmar Investment Holdings
- Gujarat Mineral Development Corp Ltd - India
- TeaM Sual Corporation - Philippines
- ASAPP Information Group - India
- SMC Global Power, Philippines
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- Port Waratah Coal Services - Australia
- Planning Commission, India
- Videocon Industries ltd - India
- Singapore Mercantile Exchange
- CNBM International Corporation - China
- Borneo Indobara - Indonesia
- Mjunction Services Limited - India
- Ministry of Mines - Canada
- Coastal Gujarat Power Limited - India
- Straits Asia Resources Limited - Singapore
- Semirara Mining and Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- GVK Power & Infra Limited - India
- Deloitte Consulting - India
- Billiton Holdings Pty Ltd - Australia
- Sojitz Corporation - Japan
- Bhoruka Overseas - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Miang Besar Coal Terminal - Indonesia
- Tamil Nadu electricity Board
- San Jose City I Power Corp, Philippines
- Romanian Commodities Exchange
- The Treasury - Australian Government
- Latin American Coal - Colombia
- Grasim Industreis Ltd - India
- Global Coal Blending Company Limited - Australia
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Coalindo Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Energy Development Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Alfred C Toepfer International GmbH - Germany
- Heidelberg Cement - Germany
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- Sakthi Sugars Limited - India
- India Bulls Power Limited - India
- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Neyveli Lignite Corporation Ltd, - India
- Ambuja Cements Ltd - India
- Merrill Lynch Commodities Europe
- Global Green Power PLC Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Energy - Thailand
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- The University of Queensland
- Ind-Barath Power Infra Limited - India
- Dalmia Cement Bharat India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Sarangani Energy Corporation, Philippines
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Cement Manufacturers Association - India
- Coal and Oil Company - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Goldman Sachs - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Lanco Infratech Ltd - India
- Simpson Spence & Young - Indonesia
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- SMG Consultants - Indonesia
- Attock Cement Pakistan Limited
- ICICI Bank Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bhatia International Limited - India
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Jorong Barutama Greston.PT - Indonesia
- Kobexindo Tractors - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- European Bulk Services B.V. - Netherlands
- Kumho Petrochemical, South Korea
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Mining Services - Indonesia
- Globalindo Alam Lestari - Indonesia
- Global Business Power Corporation, Philippines
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Karaikal Port Pvt Ltd - India
- VISA Power Limited - India
- Georgia Ports Authority, United States
- Formosa Plastics Group - Taiwan
- Thai Mozambique Logistica
- AsiaOL BioFuels Corp., Philippines
- Bulk Trading Sa - Switzerland
- Directorate General of MIneral and Coal - Indonesia
- Carbofer General Trading SA - India
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- LBH Netherlands Bv - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- Independent Power Producers Association of India
- Savvy Resources Ltd - HongKong
- International Coal Ventures Pvt Ltd - India
- Indian Oil Corporation Limited
- Binh Thuan Hamico - Vietnam
- Renaissance Capital - South Africa
- Sical Logistics Limited - India
- Sinarmas Energy and Mining - Indonesia
- Standard Chartered Bank - UAE
- Minerals Council of Australia
- Holcim Trading Pte Ltd - Singapore
- Therma Luzon, Inc, Philippines
- Vizag Seaport Private Limited - India
- Mintek Dendrill Indonesia
- London Commodity Brokers - England
- Asmin Koalindo Tuhup - Indonesia
- Indika Energy - Indonesia
- Bhushan Steel Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- Economic Council, Georgia
- Vedanta Resources Plc - India
- Marubeni Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Jaiprakash Power Ventures ltd
- Wood Mackenzie - Singapore
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Oldendorff Carriers - Singapore
- Power Finance Corporation Ltd., India
- Intertek Mineral Services - Indonesia
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Bharathi Cement Corporation - India
- Timah Investasi Mineral - Indoneisa
- Directorate Of Revenue Intelligence - India
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