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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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Monday, 08 January 24
KOSPO TO BUY 80000 MT OF INDONESIAN LOW CALORIFIC VALUE COAL FOR FEB 2024
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for the supply of Indonesian Low Calorific Value Coal from qualified suppliers for Korean ...
Monday, 08 January 24
SEABORNE TRADE REACHES 12.4BN TONNES - CLARKSONS
China will establish a back-up coal production system by 2027 to stabilise prices and secure coal supply, the state planner said on Wednesday, even ...
Monday, 08 January 24
CAPESIZES START THE NEW YEAR ON POSITIVE NOTE - BALTIC EXCHANGE
Capesize
This week the capsize market has been marked by a mix of activities and challenges. Despite a slow start following the Christmas and N ...
Friday, 05 January 24
MORGAN STANLEY SEES LOWER OIL PRICES IN 2024 ON OVERSUPPLY CONCERNS - REUTERS
Morgan Stanley sees Brent crude prices anchored near $80 per barrel in the first half in 2024 before declining towards the end of the year as it ex ...
Friday, 05 January 24
INDIA'S COAL OUTPUT RISES NEARLY 11 PC IN DEC TO 92.87 MT - PTI
India’s coal production increased by 10.75 per cent to 92.87 million tonne in December 2023 as compared to the year-ago period, an official s ...
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- Kideco Jaya Agung - Indonesia
- Barasentosa Lestari - Indonesia
- Electricity Generating Authority of Thailand
- Ministry of Finance - Indonesia
- Port Waratah Coal Services - Australia
- ASAPP Information Group - India
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- South Luzon Thermal Energy Corporation
- Leighton Contractors Pty Ltd - Australia
- Larsen & Toubro Limited - India
- Sinarmas Energy and Mining - Indonesia
- Electricity Authority, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Wilmar Investment Holdings
- Therma Luzon, Inc, Philippines
- CNBM International Corporation - China
- Indika Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Oldendorff Carriers - Singapore
- Altura Mining Limited, Indonesia
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- Bhushan Steel Limited - India
- Commonwealth Bank - Australia
- Ministry of Mines - Canada
- The University of Queensland
- Banpu Public Company Limited - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Salva Resources Pvt Ltd - India
- Carbofer General Trading SA - India
- London Commodity Brokers - England
- Sical Logistics Limited - India
- Vedanta Resources Plc - India
- Thai Mozambique Logistica
- Interocean Group of Companies - India
- Parry Sugars Refinery, India
- Parliament of New Zealand
- Eastern Coal Council - USA
- Australian Commodity Traders Exchange
- Makarim & Taira - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Billiton Holdings Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- Siam City Cement PLC, Thailand
- Merrill Lynch Commodities Europe
- Georgia Ports Authority, United States
- Aditya Birla Group - India
- Orica Australia Pty. Ltd.
- Gujarat Mineral Development Corp Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- Energy Link Ltd, New Zealand
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- McConnell Dowell - Australia
- Mintek Dendrill Indonesia
- Siam City Cement - Thailand
- OPG Power Generation Pvt Ltd - India
- Edison Trading Spa - Italy
- Intertek Mineral Services - Indonesia
- Tata Chemicals Ltd - India
- Uttam Galva Steels Limited - India
- Posco Energy - South Korea
- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Maheswari Brothers Coal Limited - India
- Australian Coal Association
- Global Green Power PLC Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- Trasteel International SA, Italy
- Lanco Infratech Ltd - India
- CIMB Investment Bank - Malaysia
- Latin American Coal - Colombia
- White Energy Company Limited
- VISA Power Limited - India
- The State Trading Corporation of India Ltd
- Directorate General of MIneral and Coal - Indonesia
- Antam Resourcindo - Indonesia
- Iligan Light & Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Energy Development Corp, Philippines
- Metalloyd Limited - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Chamber of Mines of South Africa
- GVK Power & Infra Limited - India
- Savvy Resources Ltd - HongKong
- Meralco Power Generation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kalimantan Lumbung Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- New Zealand Coal & Carbon
- Indonesian Coal Mining Association
- Medco Energi Mining Internasional
- Price Waterhouse Coopers - Russia
- Coalindo Energy - Indonesia
- Indian Energy Exchange, India
- Indogreen Group - Indonesia
- Bukit Baiduri Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- India Bulls Power Limited - India
- Dalmia Cement Bharat India
- MS Steel International - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- TeaM Sual Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Essar Steel Hazira Ltd - India
- Romanian Commodities Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Semirara Mining Corp, Philippines
- Singapore Mercantile Exchange
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- PTC India Limited - India
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Jaiprakash Power Ventures ltd
- Meenaskhi Energy Private Limited - India
- Anglo American - United Kingdom
- Economic Council, Georgia
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Petron Corporation, Philippines
- Borneo Indobara - Indonesia
- Bangladesh Power Developement Board
- Deloitte Consulting - India
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Ceylon Electricity Board - Sri Lanka
- Sindya Power Generating Company Private Ltd
- Rashtriya Ispat Nigam Limited - India
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- Madhucon Powers Ltd - India
- Straits Asia Resources Limited - Singapore
- Eastern Energy - Thailand
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Mercuria Energy - Indonesia
- Grasim Industreis Ltd - India
- Central Electricity Authority - India
- Alfred C Toepfer International GmbH - Germany
- Ind-Barath Power Infra Limited - India
- Power Finance Corporation Ltd., India
- Marubeni Corporation - India
- Kobexindo Tractors - Indoneisa
- Coastal Gujarat Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Bhoruka Overseas - Indonesia
- Mjunction Services Limited - India
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- The Treasury - Australian Government
- Tamil Nadu electricity Board
- Sojitz Corporation - Japan
- SMC Global Power, Philippines
- Simpson Spence & Young - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- PNOC Exploration Corporation - Philippines
- Gujarat Sidhee Cement - India
- Cement Manufacturers Association - India
- Minerals Council of Australia
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Sakthi Sugars Limited - India
- Agrawal Coal Company - India
- International Coal Ventures Pvt Ltd - India
- Africa Commodities Group - South Africa
- Central Java Power - Indonesia
- GAC Shipping (India) Pvt Ltd
- Karaikal Port Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Global Business Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Neyveli Lignite Corporation Ltd, - India
- Riau Bara Harum - Indonesia
- Bulk Trading Sa - Switzerland
- Xindia Steels Limited - India
- SN Aboitiz Power Inc, Philippines
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Chettinad Cement Corporation Ltd - India
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