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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, 19 January 12
SOUTHGOBI RESOURCES SELLS MORE THAN FOUR MILLION TONNES OF COAL IN 2011, 58% MORE THAN 2010
COALspot.com - SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) has successfully complets year 2011 on guidance in terms of coal sales and production.
...
Thursday, 19 January 12
14TH VOGP MEETING IN HO CHI MINH CITY HANDS OUT LATEST UPDATES AND DEVELOPMENTS IN VIETNAM'S ENERGY INDUSTRY
Press Release: At upcoming 14th Vietnam Oil Gas Power on 27-28 Feb in Ho Chi Minh City the industry’s most influential names including Petrovi ...
Thursday, 19 January 12
DELTA DUNIA SEALS US$820 MIO CONTRACT INSIDER STORIES
Insider Stories reported that, PT Delta Dunia Makmur Tbk (DOID) has announced that its primary operating subsidiary, PT Bukit Makmur Mandiri Utama ( ...
Wednesday, 18 January 12
WARM WINTER ACROSS EUROPE HAS IMPACTED NEGATIVELY COAL DEMAND - BRS
With the Chinese New Year just a week away, all markets are slowing down. The drop in freight rates for all sizes has been significant over the past ...
Wednesday, 18 January 12
DRY BULK MARKET'S DRAMA CONTINUES IN START OF NEW WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A flurry of newbuilding deliveries, coupled with a slow start to the new year, a typical trend for the dry bulk market, has led the industry's benc ...
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- Global Business Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Simpson Spence & Young - Indonesia
- Gujarat Sidhee Cement - India
- IEA Clean Coal Centre - UK
- Marubeni Corporation - India
- Medco Energi Mining Internasional
- Georgia Ports Authority, United States
- Sindya Power Generating Company Private Ltd
- Latin American Coal - Colombia
- Kepco SPC Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Baramulti Group, Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Globalindo Alam Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- Coalindo Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Bangladesh Power Developement Board
- Bhatia International Limited - India
- Bharathi Cement Corporation - India
- Global Green Power PLC Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jindal Steel & Power Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Thai Mozambique Logistica
- Price Waterhouse Coopers - Russia
- Ambuja Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Intertek Mineral Services - Indonesia
- Attock Cement Pakistan Limited
- Anglo American - United Kingdom
- Romanian Commodities Exchange
- Formosa Plastics Group - Taiwan
- PTC India Limited - India
- Port Waratah Coal Services - Australia
- Ministry of Transport, Egypt
- Larsen & Toubro Limited - India
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Bulk Trading Sa - Switzerland
- Indo Tambangraya Megah - Indonesia
- Singapore Mercantile Exchange
- Energy Link Ltd, New Zealand
- Sakthi Sugars Limited - India
- Meenaskhi Energy Private Limited - India
- Independent Power Producers Association of India
- Binh Thuan Hamico - Vietnam
- Cement Manufacturers Association - India
- Cigading International Bulk Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Ministry of Finance - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Vedanta Resources Plc - India
- Bahari Cakrawala Sebuku - Indonesia
- New Zealand Coal & Carbon
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Kumho Petrochemical, South Korea
- Straits Asia Resources Limited - Singapore
- Mercator Lines Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Kaltim Prima Coal - Indonesia
- Renaissance Capital - South Africa
- Madhucon Powers Ltd - India
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- Bukit Makmur.PT - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Mines - Canada
- Tamil Nadu electricity Board
- The Treasury - Australian Government
- Krishnapatnam Port Company Ltd. - India
- International Coal Ventures Pvt Ltd - India
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- Samtan Co., Ltd - South Korea
- Mercuria Energy - Indonesia
- McConnell Dowell - Australia
- Mjunction Services Limited - India
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- Kartika Selabumi Mining - Indonesia
- Planning Commission, India
- Savvy Resources Ltd - HongKong
- Timah Investasi Mineral - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Goldman Sachs - Singapore
- GVK Power & Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- Makarim & Taira - Indonesia
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- Wood Mackenzie - Singapore
- San Jose City I Power Corp, Philippines
- Rio Tinto Coal - Australia
- Sree Jayajothi Cements Limited - India
- Jaiprakash Power Ventures ltd
- Riau Bara Harum - Indonesia
- PowerSource Philippines DevCo
- Coastal Gujarat Power Limited - India
- ASAPP Information Group - India
- Electricity Generating Authority of Thailand
- Billiton Holdings Pty Ltd - Australia
- Salva Resources Pvt Ltd - India
- Edison Trading Spa - Italy
- London Commodity Brokers - England
- ICICI Bank Limited - India
- Borneo Indobara - Indonesia
- GMR Energy Limited - India
- Sojitz Corporation - Japan
- Eastern Coal Council - USA
- Trasteel International SA, Italy
- Siam City Cement - Thailand
- Uttam Galva Steels Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining and Power Corporation, Philippines
- Australian Commodity Traders Exchange
- Semirara Mining Corp, Philippines
- Lanco Infratech Ltd - India
- Indian Oil Corporation Limited
- PNOC Exploration Corporation - Philippines
- Bhushan Steel Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Indogreen Group - Indonesia
- Posco Energy - South Korea
- White Energy Company Limited
- Malabar Cements Ltd - India
- India Bulls Power Limited - India
- Antam Resourcindo - Indonesia
- Iligan Light & Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Sarangani Energy Corporation, Philippines
- Eastern Energy - Thailand
- Mintek Dendrill Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Economic Council, Georgia
- European Bulk Services B.V. - Netherlands
- TeaM Sual Corporation - Philippines
- Standard Chartered Bank - UAE
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Star Paper Mills Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Pendopo Energi Batubara - Indonesia
- Orica Mining Services - Indonesia
- Therma Luzon, Inc, Philippines
- Parliament of New Zealand
- Electricity Authority, New Zealand
- Banpu Public Company Limited - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Dalmia Cement Bharat India
- Aboitiz Power Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Essar Steel Hazira Ltd - India
- Videocon Industries ltd - India
- Thiess Contractors Indonesia
- Indian Energy Exchange, India
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- South Luzon Thermal Energy Corporation
- Toyota Tsusho Corporation, Japan
- Chamber of Mines of South Africa
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Orica Australia Pty. Ltd.
- VISA Power Limited - India
- Central Java Power - Indonesia
- Vizag Seaport Private Limited - India
- Indonesian Coal Mining Association
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Maheswari Brothers Coal Limited - India
- Directorate Of Revenue Intelligence - India
- Wilmar Investment Holdings
- Africa Commodities Group - South Africa
- Tata Chemicals Ltd - India
- MS Steel International - UAE
- Grasim Industreis Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Merrill Lynch Commodities Europe
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sical Logistics Limited - India
- Altura Mining Limited, Indonesia
- Minerals Council of Australia
- Kalimantan Lumbung Energi - Indonesia
- Interocean Group of Companies - India
- Heidelberg Cement - Germany
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Global Coal Blending Company Limited - Australia
- Indika Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Holcim Trading Pte Ltd - Singapore
- Metalloyd Limited - United Kingdom
- Parry Sugars Refinery, India
- Aditya Birla Group - India
- Carbofer General Trading SA - India
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