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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, 11 February 12
WILL HISTORY REPEAT ITSELF IN THIS SHIPPING CYCLE? - CLARKSONS / HELLENIC SHIPPING
A slightly dubious "best man" joke runs as follows… Best man (giving his wedding speech): "Have you noticed how history repeat ...
Friday, 10 February 12
TONNAGE KEEPS ON COMING - DREWRY
Drewry Maritime Research’s latest edition of its Dry Bulk Forecaster pulls no punches in its assessment of a market that looks certain to cont ...
Friday, 10 February 12
GIVE PERMIT POWERS TO GOVERNORS: MINERS - THE JAKARTA POST
The Jakarta Post reported that, following clashes between mining companies and local residents, the Indonesian Mining Association (IMA) wants to tra ...
Thursday, 09 February 12
AUSTRALIA'S EPIC TO ACQUIRE 15,500 HA COAL EXPLORATION LICENCES IN EAST KALIMANTAN, INDONESIA
COALspot.com - Epic Resources Limited to acquire two coal concessions in Kutai Barat regency, East Kalimantan, Indonesia.
According to company's ...
Thursday, 09 February 12
RESOURCE ALAM BUYS 28,521HA CONCESSIONS - INSIDER STORIES
Insider Stories reported that, PT Resource Alam Indonesia Tbk (KKGI), owned by Adijanto family, today announced acquisition of 75% interest in PT Ka ...
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- Coalindo Energy - Indonesia
- White Energy Company Limited
- Globalindo Alam Lestari - Indonesia
- Altura Mining Limited, Indonesia
- The State Trading Corporation of India Ltd
- The Treasury - Australian Government
- New Zealand Coal & Carbon
- Indonesian Coal Mining Association
- Posco Energy - South Korea
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Electricity Regulatory Commission - India
- Australian Commodity Traders Exchange
- Australian Coal Association
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Iligan Light & Power Inc, Philippines
- PTC India Limited - India
- Videocon Industries ltd - India
- Sakthi Sugars Limited - India
- GVK Power & Infra Limited - India
- Trasteel International SA, Italy
- Sojitz Corporation - Japan
- Central Electricity Authority - India
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Banpu Public Company Limited - Thailand
- OPG Power Generation Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Orica Australia Pty. Ltd.
- SN Aboitiz Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Semirara Mining Corp, Philippines
- Ambuja Cements Ltd - India
- Indian Oil Corporation Limited
- Gujarat Sidhee Cement - India
- Wood Mackenzie - Singapore
- Xindia Steels Limited - India
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- IEA Clean Coal Centre - UK
- ICICI Bank Limited - India
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- MS Steel International - UAE
- Parry Sugars Refinery, India
- CIMB Investment Bank - Malaysia
- Merrill Lynch Commodities Europe
- Miang Besar Coal Terminal - Indonesia
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Interocean Group of Companies - India
- Binh Thuan Hamico - Vietnam
- Savvy Resources Ltd - HongKong
- Jaiprakash Power Ventures ltd
- AsiaOL BioFuels Corp., Philippines
- Global Coal Blending Company Limited - Australia
- Eastern Coal Council - USA
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Global Business Power Corporation, Philippines
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- Indo Tambangraya Megah - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Minerals Council of Australia
- Kepco SPC Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- Chettinad Cement Corporation Ltd - India
- Bhushan Steel Limited - India
- Siam City Cement - Thailand
- Siam City Cement PLC, Thailand
- Asmin Koalindo Tuhup - Indonesia
- Mercator Lines Limited - India
- Ceylon Electricity Board - Sri Lanka
- Kalimantan Lumbung Energi - Indonesia
- Coastal Gujarat Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Dalmia Cement Bharat India
- CNBM International Corporation - China
- Wilmar Investment Holdings
- Kumho Petrochemical, South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Meralco Power Generation, Philippines
- Kartika Selabumi Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Chamber of Mines of South Africa
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- Makarim & Taira - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Deloitte Consulting - India
- Singapore Mercantile Exchange
- Bahari Cakrawala Sebuku - Indonesia
- LBH Netherlands Bv - Netherlands
- Maharashtra Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- Tamil Nadu electricity Board
- Latin American Coal - Colombia
- Oldendorff Carriers - Singapore
- Planning Commission, India
- Ministry of Transport, Egypt
- Romanian Commodities Exchange
- Metalloyd Limited - United Kingdom
- Port Waratah Coal Services - Australia
- Larsen & Toubro Limited - India
- Billiton Holdings Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Thai Mozambique Logistica
- Baramulti Group, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Therma Luzon, Inc, Philippines
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Star Paper Mills Limited - India
- Maheswari Brothers Coal Limited - India
- Bukit Baiduri Energy - Indonesia
- London Commodity Brokers - England
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Ministry of Finance - Indonesia
- International Coal Ventures Pvt Ltd - India
- GMR Energy Limited - India
- Jindal Steel & Power Ltd - India
- Malabar Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Directorate Of Revenue Intelligence - India
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Attock Cement Pakistan Limited
- Kobexindo Tractors - Indoneisa
- SMG Consultants - Indonesia
- Antam Resourcindo - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bangladesh Power Developement Board
- Eastern Energy - Thailand
- Mercuria Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Goldman Sachs - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Samtan Co., Ltd - South Korea
- Mjunction Services Limited - India
- Energy Development Corp, Philippines
- Independent Power Producers Association of India
- Grasim Industreis Ltd - India
- Simpson Spence & Young - Indonesia
- Indika Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Borneo Indobara - Indonesia
- Medco Energi Mining Internasional
- Vizag Seaport Private Limited - India
- Indogreen Group - Indonesia
- Uttam Galva Steels Limited - India
- IHS Mccloskey Coal Group - USA
- Bhoruka Overseas - Indonesia
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- SMC Global Power, Philippines
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- Thiess Contractors Indonesia
- Global Green Power PLC Corporation, Philippines
- Cement Manufacturers Association - India
- Ind-Barath Power Infra Limited - India
- Bharathi Cement Corporation - India
- Sarangani Energy Corporation, Philippines
- Georgia Ports Authority, United States
- Kohat Cement Company Ltd. - Pakistan
- India Bulls Power Limited - India
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- McConnell Dowell - Australia
- Vedanta Resources Plc - India
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Rashtriya Ispat Nigam Limited - India
- Central Java Power - Indonesia
- Aditya Birla Group - India
- Sindya Power Generating Company Private Ltd
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Economic Council, Georgia
- Formosa Plastics Group - Taiwan
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Commonwealth Bank - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Intertek Mineral Services - Indonesia
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