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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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Sunday, 08 January 12
THARPAK CONSORTIUM FORMED TO DEVELOP MEGA ENERGY COMPLEX IN SINDH PROVINCE, PAKISTAN
Press Release: On January 5th, TharPak, LLC met with officials of the Embassy of Pakistan in Washington DC to introduce and announce the formation o ...
Saturday, 07 January 12
COAL MARKETS SEE FALLING SPOT PRICES
COALspot.com – World’s thermal coal spot prices have slipped this week..
globalCOAL index in Newcastle Port, benchmark for Asian mark ...
Friday, 06 January 12
COAL INDIA LINKED COAL PRICES WITH INTERNATIONAL COAL PRICES
COALspot.com - Consumers of indigenous coal in India to pay International prices in the future. Coal India has recently moved from UHV pricing mecha ...
Friday, 06 January 12
CLARIDEN GLOBAL BRINGS YOU INDONESIA MINING 2012
Capitalizing Business & Investment Opportunities in an Uncertain Market.Press Release - Clariden Global brings you Indonesia Mining 2012, the dedi ...
Friday, 06 January 12
THE PANAMAX MARKET EXPERIENCED A SLOW START TO 2012 - FEARNLEYS AS
Handy
As usual after a holiday owners and charterers both try to get a feel of the market. An Armada of Supras were talking to ballast towards USG, ...
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- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining Corp, Philippines
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Vijayanagar Sugar Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- TNB Fuel Sdn Bhd - Malaysia
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Malabar Cements Ltd - India
- European Bulk Services B.V. - Netherlands
- Straits Asia Resources Limited - Singapore
- Indika Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Goldman Sachs - Singapore
- Aboitiz Power Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Uttam Galva Steels Limited - India
- The Treasury - Australian Government
- Eastern Energy - Thailand
- India Bulls Power Limited - India
- Ministry of Finance - Indonesia
- Bhatia International Limited - India
- Indo Tambangraya Megah - Indonesia
- MS Steel International - UAE
- Ind-Barath Power Infra Limited - India
- Samtan Co., Ltd - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- Globalindo Alam Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- San Jose City I Power Corp, Philippines
- Coal and Oil Company - UAE
- Siam City Cement PLC, Thailand
- Bulk Trading Sa - Switzerland
- OPG Power Generation Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Thiess Contractors Indonesia
- Marubeni Corporation - India
- Kalimantan Lumbung Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Eastern Coal Council - USA
- Siam City Cement - Thailand
- Renaissance Capital - South Africa
- Sakthi Sugars Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Sojitz Corporation - Japan
- Economic Council, Georgia
- SMG Consultants - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- Coalindo Energy - Indonesia
- Agrawal Coal Company - India
- Rio Tinto Coal - Australia
- Jorong Barutama Greston.PT - Indonesia
- Maheswari Brothers Coal Limited - India
- CNBM International Corporation - China
- Rashtriya Ispat Nigam Limited - India
- Vizag Seaport Private Limited - India
- Singapore Mercantile Exchange
- Sarangani Energy Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- White Energy Company Limited
- Africa Commodities Group - South Africa
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
- Romanian Commodities Exchange
- Orica Mining Services - Indonesia
- Barasentosa Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Banpu Public Company Limited - Thailand
- Iligan Light & Power Inc, Philippines
- Standard Chartered Bank - UAE
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Australian Coal Association
- Aditya Birla Group - India
- Bangladesh Power Developement Board
- Metalloyd Limited - United Kingdom
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Vedanta Resources Plc - India
- Billiton Holdings Pty Ltd - Australia
- Star Paper Mills Limited - India
- Mercuria Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Georgia Ports Authority, United States
- Kaltim Prima Coal - Indonesia
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Jindal Steel & Power Ltd - India
- Mercator Lines Limited - India
- GVK Power & Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Cigading International Bulk Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- IHS Mccloskey Coal Group - USA
- Attock Cement Pakistan Limited
- Dalmia Cement Bharat India
- Savvy Resources Ltd - HongKong
- Planning Commission, India
- Mjunction Services Limited - India
- ICICI Bank Limited - India
- Bharathi Cement Corporation - India
- SN Aboitiz Power Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Australian Commodity Traders Exchange
- Port Waratah Coal Services - Australia
- Global Green Power PLC Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Global Coal Blending Company Limited - Australia
- Borneo Indobara - Indonesia
- Parliament of New Zealand
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Electricity Generating Authority of Thailand
- Wood Mackenzie - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Simpson Spence & Young - Indonesia
- Toyota Tsusho Corporation, Japan
- Essar Steel Hazira Ltd - India
- Thai Mozambique Logistica
- PTC India Limited - India
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Madhucon Powers Ltd - India
- Chamber of Mines of South Africa
- VISA Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- SMC Global Power, Philippines
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- Cement Manufacturers Association - India
- Antam Resourcindo - Indonesia
- Karaikal Port Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Formosa Plastics Group - Taiwan
- Alfred C Toepfer International GmbH - Germany
- Lanco Infratech Ltd - India
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- TeaM Sual Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- Indian Energy Exchange, India
- Posco Energy - South Korea
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- GMR Energy Limited - India
- Heidelberg Cement - Germany
- IEA Clean Coal Centre - UK
- Deloitte Consulting - India
- Sree Jayajothi Cements Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Larsen & Toubro Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kapuas Tunggal Persada - Indonesia
- Kartika Selabumi Mining - Indonesia
- Merrill Lynch Commodities Europe
- Bhoruka Overseas - Indonesia
- Ceylon Electricity Board - Sri Lanka
- GAC Shipping (India) Pvt Ltd
- ASAPP Information Group - India
- Holcim Trading Pte Ltd - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Central Java Power - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Indogreen Group - Indonesia
- Directorate Of Revenue Intelligence - India
- Grasim Industreis Ltd - India
- Tata Chemicals Ltd - India
- Therma Luzon, Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Kumho Petrochemical, South Korea
- Bhushan Steel Limited - India
- Altura Mining Limited, Indonesia
- LBH Netherlands Bv - Netherlands
- PNOC Exploration Corporation - Philippines
- Central Electricity Authority - India
- Kideco Jaya Agung - Indonesia
- The University of Queensland
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- Sindya Power Generating Company Private Ltd
- Wilmar Investment Holdings
- Oldendorff Carriers - Singapore
- Semirara Mining and Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Riau Bara Harum - Indonesia
- Gujarat Sidhee Cement - India
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- New Zealand Coal & Carbon
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