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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, 02 November 11
MMTC TO BUY 3.73 MILLION TONS OF COAL FOR 2011- 2013
COALspot.com - India’s state-owned coal and mineral trader MMTC looking for 3.73 million tons of power plant coal for the period 2011 - 2012/ ...
Wednesday, 02 November 11
PANAMAX MARKET BECAME QUIETER AFTER THE RECENT RECOVERY - BRS
There were substantial losses across the board this week: the BDI lost 6.3% to end at 2,018 and the BCI 8.2% to end 3,274. In the smaller sizes the ...
Tuesday, 01 November 11
BORNEO LUMBUNG BUYS 23.8% INTEREST IN BUMI
COALspot.com - PT. Borneo Lumbung Energi (BORN), an Indonesian coking coal producer announces that it has signed a sale and purchase agreement, cond ...
Tuesday, 01 November 11
BAKRIE FORMS STRATEGIC PARTNERSHIP WITH BORNEO - REDUCING DEBT BY USD 1 BILLION
Press Release - Enhancing the standing of “Indonesia Inc.” at the London Stock Exchange PT Bakrie & Brothers Tbk (“BNBR” ...
Tuesday, 01 November 11
ATLAS RESOURCES SETS IPO AT RP1,500 - INSIDER STORIES
Insider Stories reported that, coal miner PT Atlas Resources Tbk has set its initial public offering (IPO) at Rp1,500 (approximately US$ 0.169) per ...
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- Trasteel International SA, Italy
- Indika Energy - Indonesia
- Mjunction Services Limited - India
- Borneo Indobara - Indonesia
- Interocean Group of Companies - India
- Electricity Authority, New Zealand
- Aditya Birla Group - India
- Carbofer General Trading SA - India
- Altura Mining Limited, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Krishnapatnam Port Company Ltd. - India
- Pipit Mutiara Jaya. PT, Indonesia
- SMG Consultants - Indonesia
- Timah Investasi Mineral - Indoneisa
- MS Steel International - UAE
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- Ambuja Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- IHS Mccloskey Coal Group - USA
- GVK Power & Infra Limited - India
- Renaissance Capital - South Africa
- The Treasury - Australian Government
- Therma Luzon, Inc, Philippines
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Global Business Power Corporation, Philippines
- Posco Energy - South Korea
- Price Waterhouse Coopers - Russia
- PowerSource Philippines DevCo
- Eastern Coal Council - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Indo Tambangraya Megah - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Georgia Ports Authority, United States
- TNB Fuel Sdn Bhd - Malaysia
- Independent Power Producers Association of India
- Karbindo Abesyapradhi - Indoneisa
- Minerals Council of Australia
- Orica Australia Pty. Ltd.
- Central Electricity Authority - India
- Intertek Mineral Services - Indonesia
- Vizag Seaport Private Limited - India
- Ministry of Mines - Canada
- Central Java Power - Indonesia
- Coastal Gujarat Power Limited - India
- Ind-Barath Power Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Vedanta Resources Plc - India
- Antam Resourcindo - Indonesia
- VISA Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- Neyveli Lignite Corporation Ltd, - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Savvy Resources Ltd - HongKong
- Toyota Tsusho Corporation, Japan
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Coalindo Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- SMC Global Power, Philippines
- Bukit Baiduri Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- New Zealand Coal & Carbon
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Sarangani Energy Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Bhoruka Overseas - Indonesia
- Agrawal Coal Company - India
- White Energy Company Limited
- Gujarat Mineral Development Corp Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Meenaskhi Energy Private Limited - India
- Electricity Generating Authority of Thailand
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- London Commodity Brokers - England
- Jaiprakash Power Ventures ltd
- Thiess Contractors Indonesia
- Edison Trading Spa - Italy
- Cement Manufacturers Association - India
- Uttam Galva Steels Limited - India
- Port Waratah Coal Services - Australia
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kohat Cement Company Ltd. - Pakistan
- Rio Tinto Coal - Australia
- Grasim Industreis Ltd - India
- Iligan Light & Power Inc, Philippines
- Mercuria Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- CNBM International Corporation - China
- Ministry of Finance - Indonesia
- Mintek Dendrill Indonesia
- Coal and Oil Company - UAE
- The University of Queensland
- TeaM Sual Corporation - Philippines
- Sakthi Sugars Limited - India
- Siam City Cement PLC, Thailand
- Kalimantan Lumbung Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Standard Chartered Bank - UAE
- Binh Thuan Hamico - Vietnam
- Directorate Of Revenue Intelligence - India
- Aboitiz Power Corporation - Philippines
- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- Gujarat Sidhee Cement - India
- Salva Resources Pvt Ltd - India
- Deloitte Consulting - India
- Malabar Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Energy Link Ltd, New Zealand
- ASAPP Information Group - India
- Alfred C Toepfer International GmbH - Germany
- Chamber of Mines of South Africa
- Goldman Sachs - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kumho Petrochemical, South Korea
- Kepco SPC Power Corporation, Philippines
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- PNOC Exploration Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Orica Mining Services - Indonesia
- PTC India Limited - India
- Planning Commission, India
- Meralco Power Generation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dalmia Cement Bharat India
- Bahari Cakrawala Sebuku - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indian Oil Corporation Limited
- San Jose City I Power Corp, Philippines
- Tata Chemicals Ltd - India
- Star Paper Mills Limited - India
- Lanco Infratech Ltd - India
- Maheswari Brothers Coal Limited - India
- Samtan Co., Ltd - South Korea
- Xindia Steels Limited - India
- Thai Mozambique Logistica
- Miang Besar Coal Terminal - Indonesia
- Indian Energy Exchange, India
- Singapore Mercantile Exchange
- Bangladesh Power Developement Board
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- Riau Bara Harum - Indonesia
- Indogreen Group - Indonesia
- Globalindo Alam Lestari - Indonesia
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kobexindo Tractors - Indoneisa
- Eastern Energy - Thailand
- Australian Coal Association
- Bhushan Steel Limited - India
- Barasentosa Lestari - Indonesia
- Parry Sugars Refinery, India
- South Luzon Thermal Energy Corporation
- Rashtriya Ispat Nigam Limited - India
- Sree Jayajothi Cements Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wilmar Investment Holdings
- Medco Energi Mining Internasional
- Manunggal Multi Energi - Indonesia
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Essar Steel Hazira Ltd - India
- Energy Development Corp, Philippines
- Straits Asia Resources Limited - Singapore
- Siam City Cement - Thailand
- Anglo American - United Kingdom
- Formosa Plastics Group - Taiwan
- Karaikal Port Pvt Ltd - India
- Bharathi Cement Corporation - India
- Bukit Makmur.PT - Indonesia
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Holcim Trading Pte Ltd - Singapore
- Africa Commodities Group - South Africa
- Bayan Resources Tbk. - Indonesia
- India Bulls Power Limited - India
- McConnell Dowell - Australia
- Kideco Jaya Agung - Indonesia
- Semirara Mining Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Sojitz Corporation - Japan
- Attock Cement Pakistan Limited
- AsiaOL BioFuels Corp., Philippines
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- GMR Energy Limited - India
- Kaltim Prima Coal - Indonesia
- Parliament of New Zealand
- Maharashtra Electricity Regulatory Commission - India
- Marubeni Corporation - India
- ICICI Bank Limited - India
- Videocon Industries ltd - India
- Bhatia International Limited - India
- Merrill Lynch Commodities Europe
- Baramulti Group, Indonesia
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