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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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Thursday, 27 October 11
CAPESIZE REACHING NEW HIGHS - FEARNLEYS
Handy
Pacific market has mixed sentiments with tonnages fixed at firm levels and some tonnages in feast failing on subs.For indo-india, large eco ...
Thursday, 27 October 11
DRY BULK MARKET EDGES DOWN AS CHINAS IRON ORE DEMAND LOSES GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A plunge in Chinese iron ore demand, as a result of high steel inventories and a bleak outlook regarding steel prices, has prompted the dry bulk mar ...
Thursday, 27 October 11
BUKIT ASAM 3Q PROFIT SURGES 66.91%
Insider Stories reported that, the state-controlled coal miner PT Bukit Asam Tbk (PTBA) experienced a 66.91% increase in its net profit during a per ...
Wednesday, 26 October 11
MOODYS SEES MORE GROWTH FOR INDONESIAN COAL MINERS - THE JAKARTA GLOBE
The Jakarta Globe reported that, Indonesia’s coal mining industry looks set to grow despite an uncertain global economic outlook, according to ...
Wednesday, 26 October 11
PWCS GLOBAL SHIPPING BENCHMARKING ANALYSIS: RECOVERY IN 2010 BUT GREAT UNCERTAINLY FOR 2011
The recovery of global trade in 2010 to the same levels as 2008 led to an improvement in the overall performance of shipping companies in 2010 compa ...
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- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Attock Cement Pakistan Limited
- Kumho Petrochemical, South Korea
- GMR Energy Limited - India
- Videocon Industries ltd - India
- Sindya Power Generating Company Private Ltd
- SN Aboitiz Power Inc, Philippines
- Aditya Birla Group - India
- SMG Consultants - Indonesia
- Jindal Steel & Power Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- ICICI Bank Limited - India
- Parry Sugars Refinery, India
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- Semirara Mining and Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Star Paper Mills Limited - India
- Australian Coal Association
- Latin American Coal - Colombia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Electricity Generating Authority of Thailand
- Malabar Cements Ltd - India
- Thiess Contractors Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Borneo Indobara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Posco Energy - South Korea
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement PLC, Thailand
- Global Green Power PLC Corporation, Philippines
- IEA Clean Coal Centre - UK
- London Commodity Brokers - England
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Baiduri Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- PTC India Limited - India
- Africa Commodities Group - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Semirara Mining Corp, Philippines
- Bhushan Steel Limited - India
- Asmin Koalindo Tuhup - Indonesia
- The Treasury - Australian Government
- Thai Mozambique Logistica
- Ind-Barath Power Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- Tata Chemicals Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- Energy Link Ltd, New Zealand
- GAC Shipping (India) Pvt Ltd
- Pendopo Energi Batubara - Indonesia
- Eastern Coal Council - USA
- Ministry of Finance - Indonesia
- Jaiprakash Power Ventures ltd
- Cement Manufacturers Association - India
- Parliament of New Zealand
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- International Coal Ventures Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- CNBM International Corporation - China
- Ministry of Mines - Canada
- Bayan Resources Tbk. - Indonesia
- Sarangani Energy Corporation, Philippines
- Australian Commodity Traders Exchange
- Coastal Gujarat Power Limited - India
- Bangladesh Power Developement Board
- Essar Steel Hazira Ltd - India
- Manunggal Multi Energi - Indonesia
- Price Waterhouse Coopers - Russia
- Kartika Selabumi Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Kapuas Tunggal Persada - Indonesia
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Gujarat Mineral Development Corp Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- TNB Fuel Sdn Bhd - Malaysia
- McConnell Dowell - Australia
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Bhatia International Limited - India
- Economic Council, Georgia
- Central Electricity Authority - India
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- Chettinad Cement Corporation Ltd - India
- Goldman Sachs - Singapore
- Siam City Cement - Thailand
- Bhoruka Overseas - Indonesia
- Kideco Jaya Agung - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Riau Bara Harum - Indonesia
- Kaltim Prima Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- White Energy Company Limited
- Kobexindo Tractors - Indoneisa
- Tamil Nadu electricity Board
- Merrill Lynch Commodities Europe
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Planning Commission, India
- Vizag Seaport Private Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sojitz Corporation - Japan
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- Central Java Power - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Georgia Ports Authority, United States
- Aboitiz Power Corporation - Philippines
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- Intertek Mineral Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Leighton Contractors Pty Ltd - Australia
- Global Business Power Corporation, Philippines
- Larsen & Toubro Limited - India
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- Medco Energi Mining Internasional
- Bulk Trading Sa - Switzerland
- Iligan Light & Power Inc, Philippines
- Heidelberg Cement - Germany
- Ceylon Electricity Board - Sri Lanka
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Wilmar Investment Holdings
- AsiaOL BioFuels Corp., Philippines
- New Zealand Coal & Carbon
- Gujarat Electricity Regulatory Commission - India
- Petron Corporation, Philippines
- PowerSource Philippines DevCo
- Binh Thuan Hamico - Vietnam
- Indian Energy Exchange, India
- European Bulk Services B.V. - Netherlands
- Baramulti Group, Indonesia
- South Luzon Thermal Energy Corporation
- Directorate General of MIneral and Coal - Indonesia
- Marubeni Corporation - India
- Kalimantan Lumbung Energi - Indonesia
- Oldendorff Carriers - Singapore
- Chamber of Mines of South Africa
- Madhucon Powers Ltd - India
- Standard Chartered Bank - UAE
- Carbofer General Trading SA - India
- Timah Investasi Mineral - Indoneisa
- Power Finance Corporation Ltd., India
- Orica Mining Services - Indonesia
- Salva Resources Pvt Ltd - India
- India Bulls Power Limited - India
- Rio Tinto Coal - Australia
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- IHS Mccloskey Coal Group - USA
- Bahari Cakrawala Sebuku - Indonesia
- Indogreen Group - Indonesia
- Maheswari Brothers Coal Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Romanian Commodities Exchange
- Therma Luzon, Inc, Philippines
- Minerals Council of Australia
- Rashtriya Ispat Nigam Limited - India
- Samtan Co., Ltd - South Korea
- Xindia Steels Limited - India
- Coal and Oil Company - UAE
- Globalindo Alam Lestari - Indonesia
- Trasteel International SA, Italy
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- Mercuria Energy - Indonesia
- Coalindo Energy - Indonesia
- Mintek Dendrill Indonesia
- Simpson Spence & Young - Indonesia
- Agrawal Coal Company - India
- Ambuja Cements Ltd - India
- GVK Power & Infra Limited - India
- Sakthi Sugars Limited - India
- Cigading International Bulk Terminal - Indonesia
- Interocean Group of Companies - India
- Bharathi Cement Corporation - India
- The University of Queensland
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- Independent Power Producers Association of India
- Sree Jayajothi Cements Limited - India
- OPG Power Generation Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- SMC Global Power, Philippines
- Meralco Power Generation, Philippines
- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- Mercator Lines Limited - India
- Eastern Energy - Thailand
- Commonwealth Bank - Australia
- Grasim Industreis Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
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