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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, 20 February 12
COAL BOOM AND ENVIRONMENTAL CONCERN - SUNIL K KUMBHAT
COALspot.com - The dawn of the 21st century has seen a shift in the world's commercial balance of power, with the dominance of the US, Europe and J ...
Sunday, 19 February 12
THE SPOT FIXTURE RATES WERE REPORTED AT HIGH LEVELS - VISTAAR
COALspot.com - "The markets seems to holding back this week appears the momentum which picked up last week may slow down" - Capt. Reddy of ...
Sunday, 19 February 12
INDIKA ACQUIRES MULTI TAMBANGJAYA - INSIDER STORIES
Insider Stories reported that, PT Indika Energy Tbk (INDY) announced that wholly-owned subsidiaries have signed a conditional sale and purchase agre ...
Friday, 17 February 12
COLOMBIA COAL PRODUCTION, EXPORTS JUMP IN 2011: GOVT - COLOMBIA REPORTS
Colombia Reports reported that, colombia's coal production jumped 15.4% in 2011 to 85.8 million tonnes versus the previous year while exports rose ...
Thursday, 16 February 12
GEARING UP FOR THE EMERGING OIL & GAS OPPORTUNITIES IN MYANMAR
Press Release - Myanmar Ministry of Energy and Centre for Management Technology (CMT) to Co-host MOGP (Myanmar Oil, Gas & Power) Summit on 28 - ...
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- Makarim & Taira - Indonesia
- Heidelberg Cement - Germany
- Eastern Coal Council - USA
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- Bangladesh Power Developement Board
- Ind-Barath Power Infra Limited - India
- Edison Trading Spa - Italy
- White Energy Company Limited
- Port Waratah Coal Services - Australia
- VISA Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Videocon Industries ltd - India
- Ministry of Mines - Canada
- Attock Cement Pakistan Limited
- SMC Global Power, Philippines
- Xindia Steels Limited - India
- The University of Queensland
- Indonesian Coal Mining Association
- Vizag Seaport Private Limited - India
- Central Electricity Authority - India
- Wood Mackenzie - Singapore
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Independent Power Producers Association of India
- Miang Besar Coal Terminal - Indonesia
- Toyota Tsusho Corporation, Japan
- Georgia Ports Authority, United States
- Carbofer General Trading SA - India
- Kaltim Prima Coal - Indonesia
- Deloitte Consulting - India
- Baramulti Group, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Chettinad Cement Corporation Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Globalindo Alam Lestari - Indonesia
- Aditya Birla Group - India
- Sarangani Energy Corporation, Philippines
- Grasim Industreis Ltd - India
- IEA Clean Coal Centre - UK
- London Commodity Brokers - England
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Gujarat Mineral Development Corp Ltd - India
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- Ambuja Cements Ltd - India
- Latin American Coal - Colombia
- Mintek Dendrill Indonesia
- Maharashtra Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Bharathi Cement Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- Africa Commodities Group - South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jaiprakash Power Ventures ltd
- Parliament of New Zealand
- Star Paper Mills Limited - India
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- Electricity Authority, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Sakthi Sugars Limited - India
- Mjunction Services Limited - India
- TeaM Sual Corporation - Philippines
- GAC Shipping (India) Pvt Ltd
- Barasentosa Lestari - Indonesia
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Rio Tinto Coal - Australia
- Directorate Of Revenue Intelligence - India
- Pendopo Energi Batubara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- MS Steel International - UAE
- McConnell Dowell - Australia
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Bayan Resources Tbk. - Indonesia
- Riau Bara Harum - Indonesia
- Sical Logistics Limited - India
- Siam City Cement - Thailand
- Thiess Contractors Indonesia
- Gujarat Electricity Regulatory Commission - India
- Vedanta Resources Plc - India
- Ceylon Electricity Board - Sri Lanka
- Indian Oil Corporation Limited
- Eastern Energy - Thailand
- Gujarat Sidhee Cement - India
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Billiton Holdings Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Thai Mozambique Logistica
- Manunggal Multi Energi - Indonesia
- Coal and Oil Company - UAE
- Bhushan Steel Limited - India
- Marubeni Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Finance - Indonesia
- Essar Steel Hazira Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Central Java Power - Indonesia
- Semirara Mining Corp, Philippines
- Bhoruka Overseas - Indonesia
- South Luzon Thermal Energy Corporation
- Planning Commission, India
- GMR Energy Limited - India
- Iligan Light & Power Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Transport, Egypt
- Coastal Gujarat Power Limited - India
- European Bulk Services B.V. - Netherlands
- Energy Link Ltd, New Zealand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Minerals Council of Australia
- Kobexindo Tractors - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Borneo Indobara - Indonesia
- Parry Sugars Refinery, India
- Kideco Jaya Agung - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Kumho Petrochemical, South Korea
- Bukit Baiduri Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Dalmia Cement Bharat India
- IHS Mccloskey Coal Group - USA
- Karaikal Port Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- SMG Consultants - Indonesia
- Savvy Resources Ltd - HongKong
- Price Waterhouse Coopers - Russia
- PetroVietnam Power Coal Import and Supply Company
- International Coal Ventures Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Energy Development Corp, Philippines
- Lanco Infratech Ltd - India
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- CNBM International Corporation - China
- Bukit Makmur.PT - Indonesia
- Trasteel International SA, Italy
- Global Green Power PLC Corporation, Philippines
- The State Trading Corporation of India Ltd
- Leighton Contractors Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Holcim Trading Pte Ltd - Singapore
- LBH Netherlands Bv - Netherlands
- ASAPP Information Group - India
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement PLC, Thailand
- Bulk Trading Sa - Switzerland
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Aboitiz Power Corporation - Philippines
- Formosa Plastics Group - Taiwan
- CIMB Investment Bank - Malaysia
- Agrawal Coal Company - India
- Economic Council, Georgia
- Power Finance Corporation Ltd., India
- Indika Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Altura Mining Limited, Indonesia
- Electricity Generating Authority of Thailand
- Samtan Co., Ltd - South Korea
- Renaissance Capital - South Africa
- Interocean Group of Companies - India
- ICICI Bank Limited - India
- Orica Mining Services - Indonesia
- Indogreen Group - Indonesia
- Anglo American - United Kingdom
- New Zealand Coal & Carbon
- Merrill Lynch Commodities Europe
- Global Coal Blending Company Limited - Australia
- Medco Energi Mining Internasional
- San Jose City I Power Corp, Philippines
- Meralco Power Generation, Philippines
- Indian Energy Exchange, India
- Goldman Sachs - Singapore
- Malabar Cements Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Orica Australia Pty. Ltd.
- Tata Chemicals Ltd - India
- Standard Chartered Bank - UAE
- The Treasury - Australian Government
- Romanian Commodities Exchange
- Krishnapatnam Port Company Ltd. - India
- Oldendorff Carriers - Singapore
- Coalindo Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Australian Coal Association
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Jindal Steel & Power Ltd - India
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Asmin Koalindo Tuhup - Indonesia
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