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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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Saturday, 25 March 23
COAL INDIA HAS STRONG CASE TO INCREASE PRICES, TALKS ON: CMD AGRAWAL - BUSINESS STANDARD
Coal India (CIL) Chairman and Managing Director Pramod Agrawal said on Monday there is a “strong case” for increasing coal prices, and ...
Saturday, 25 March 23
ASIAN CRUDE PALM OIL WATCH 1Q23 - FITCH RATINGS
Malaysian benchmark crude palm oil (CPO) spot prices have averaged around USD915 per tonne (t) so far in 1Q23, sharply lower than the average of ar ...
Saturday, 25 March 23
INDONESIA’S COAL EXPORT INCREASED BY 21.0% YOY TO 388.4 MLN T IN 2022 - BANCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels. In the f ...
Saturday, 25 March 23
GLOBAL LNG-ASIA SPOT PRICES SLIP AS WEAK NORTHERN DEMAND REMAINS - REUTERS
Asian spot prices of liquefied natural gas (LNG) declined this week, falling to a 21-month low, as weak demand in the northeast Asia region continu ...
Wednesday, 22 March 23
OIL PRICE FALL SPECULATIVE, TO HIT $140 BY YEAR-END -ANDURAND: REUTERS
The recent fall in oil prices due to banking jitters is speculative and oil will hit $140 a barrel by the end of the year, hedge fund manager Pierr ...
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- Indika Energy - Indonesia
- Indonesian Coal Mining Association
- Kohat Cement Company Ltd. - Pakistan
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Sidhee Cement - India
- Price Waterhouse Coopers - Russia
- Edison Trading Spa - Italy
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Kobexindo Tractors - Indoneisa
- Ministry of Mines - Canada
- Asmin Koalindo Tuhup - Indonesia
- Riau Bara Harum - Indonesia
- Metalloyd Limited - United Kingdom
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- Sree Jayajothi Cements Limited - India
- Leighton Contractors Pty Ltd - Australia
- Eastern Energy - Thailand
- Intertek Mineral Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Ministry of Finance - Indonesia
- AsiaOL BioFuels Corp., Philippines
- McConnell Dowell - Australia
- Aditya Birla Group - India
- Manunggal Multi Energi - Indonesia
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- Bhatia International Limited - India
- Bayan Resources Tbk. - Indonesia
- Eastern Coal Council - USA
- Cigading International Bulk Terminal - Indonesia
- IEA Clean Coal Centre - UK
- Ceylon Electricity Board - Sri Lanka
- Anglo American - United Kingdom
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Goldman Sachs - Singapore
- CNBM International Corporation - China
- Bukit Baiduri Energy - Indonesia
- San Jose City I Power Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Antam Resourcindo - Indonesia
- South Luzon Thermal Energy Corporation
- Kalimantan Lumbung Energi - Indonesia
- Africa Commodities Group - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Malabar Cements Ltd - India
- India Bulls Power Limited - India
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
- TeaM Sual Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- ASAPP Information Group - India
- Marubeni Corporation - India
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Standard Chartered Bank - UAE
- Therma Luzon, Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Bhushan Steel Limited - India
- Energy Development Corp, Philippines
- Thai Mozambique Logistica
- Planning Commission, India
- Economic Council, Georgia
- Maheswari Brothers Coal Limited - India
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Siam City Cement - Thailand
- Essar Steel Hazira Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Deloitte Consulting - India
- Aboitiz Power Corporation - Philippines
- Grasim Industreis Ltd - India
- Bangladesh Power Developement Board
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- Petron Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Jindal Steel & Power Ltd - India
- Directorate Of Revenue Intelligence - India
- Global Business Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Lanco Infratech Ltd - India
- Jaiprakash Power Ventures ltd
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- Ministry of Transport, Egypt
- Semirara Mining Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- VISA Power Limited - India
- Australian Coal Association
- Tata Chemicals Ltd - India
- Uttam Galva Steels Limited - India
- White Energy Company Limited
- GMR Energy Limited - India
- Rio Tinto Coal - Australia
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Australian Commodity Traders Exchange
- Sinarmas Energy and Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- PowerSource Philippines DevCo
- Formosa Plastics Group - Taiwan
- Coalindo Energy - Indonesia
- Indian Energy Exchange, India
- SMC Global Power, Philippines
- PTC India Limited - India
- Indian Oil Corporation Limited
- Toyota Tsusho Corporation, Japan
- Simpson Spence & Young - Indonesia
- Altura Mining Limited, Indonesia
- OPG Power Generation Pvt Ltd - India
- New Zealand Coal & Carbon
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Commonwealth Bank - Australia
- Bharathi Cement Corporation - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- Mercuria Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Australia Pty. Ltd.
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- Mjunction Services Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Central Electricity Authority - India
- Sojitz Corporation - Japan
- Pipit Mutiara Jaya. PT, Indonesia
- Trasteel International SA, Italy
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Thiess Contractors Indonesia
- Tamil Nadu electricity Board
- Agrawal Coal Company - India
- The University of Queensland
- Wood Mackenzie - Singapore
- International Coal Ventures Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Sakthi Sugars Limited - India
- Bhoruka Overseas - Indonesia
- Sical Logistics Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Salva Resources Pvt Ltd - India
- Electricity Authority, New Zealand
- ICICI Bank Limited - India
- Kaltim Prima Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Oldendorff Carriers - Singapore
- Karaikal Port Pvt Ltd - India
- Wilmar Investment Holdings
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Romanian Commodities Exchange
- Ind-Barath Power Infra Limited - India
- Neyveli Lignite Corporation Ltd, - India
- The Treasury - Australian Government
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meenaskhi Energy Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- Iligan Light & Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Barasentosa Lestari - Indonesia
- Bulk Trading Sa - Switzerland
- Dalmia Cement Bharat India
- GVK Power & Infra Limited - India
- Central Java Power - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- Meralco Power Generation, Philippines
- Mintek Dendrill Indonesia
- Larsen & Toubro Limited - India
- Ambuja Cements Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Minerals Council of Australia
- London Commodity Brokers - England
- TNB Fuel Sdn Bhd - Malaysia
- Indo Tambangraya Megah - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Indogreen Group - Indonesia
- Xindia Steels Limited - India
- Interocean Group of Companies - India
- Chamber of Mines of South Africa
- Borneo Indobara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Coal Blending Company Limited - Australia
- Parliament of New Zealand
- Rashtriya Ispat Nigam Limited - India
- Coal and Oil Company - UAE
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