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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, 29 December 11
NEW VESSELS DELIVERED ARE FLOODING THE OCEANS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
As expected 2011 has been the year that newbuilding deliveries peaked and kept "flooding" the market, thus supressing freight rates and er ...
Tuesday, 27 December 11
COAL SHIPMENT OF TIANJIN PORT REACHED 6.72 MLN TONNES IN NOVEMBER - STEEL HOME / HELLENIC SHIPPING
Tianjin port shipped 6.72 million tonnes of coal in November, decreasing 600,000 tonnes versus 7.32 million tonnes in October, while up 21.09% or 1. ...
Tuesday, 27 December 11
NEW CLAUSE PUBLISHED FOR SLOW STEAMING - BIMCO
Many owners and operators faced with high bunker prices are considering implementing slow steaming regimes to save fuel and to assist with capacity ...
Monday, 26 December 11
NEW EXPORT TAX PLAN GREETED WITH PRAISE AND CRITICISM - THE JAKARTA POST
The Jakarta Post, one of the Indonesia's leading english news paper reported that, both praise and criticism showered the government’s plan t ...
Sunday, 25 December 11
THERMAL COAL PRICES GAINED UP TO 4.32 PERCENT
COALspot.com - globalCOAL index gained 4.32 percent to US$106.36 per ton in RBCT, benchmark for South Asia and West Europe markets, for the week end ...
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- The State Trading Corporation of India Ltd
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Posco Energy - South Korea
- Tamil Nadu electricity Board
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Minerals Council of Australia
- International Coal Ventures Pvt Ltd - India
- Attock Cement Pakistan Limited
- Ind-Barath Power Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Chamber of Mines of South Africa
- Baramulti Group, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Aditya Birla Group - India
- Meenaskhi Energy Private Limited - India
- Singapore Mercantile Exchange
- Madhucon Powers Ltd - India
- Kartika Selabumi Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- IEA Clean Coal Centre - UK
- LBH Netherlands Bv - Netherlands
- Maheswari Brothers Coal Limited - India
- Anglo American - United Kingdom
- Bukit Makmur.PT - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Wilmar Investment Holdings
- Indonesian Coal Mining Association
- SMC Global Power, Philippines
- Alfred C Toepfer International GmbH - Germany
- Jaiprakash Power Ventures ltd
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement - Thailand
- Kobexindo Tractors - Indoneisa
- Commonwealth Bank - Australia
- Indo Tambangraya Megah - Indonesia
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- Gujarat Sidhee Cement - India
- Maharashtra Electricity Regulatory Commission - India
- Sindya Power Generating Company Private Ltd
- Ambuja Cements Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- CNBM International Corporation - China
- Sarangani Energy Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- European Bulk Services B.V. - Netherlands
- Sree Jayajothi Cements Limited - India
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- Intertek Mineral Services - Indonesia
- Global Business Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Medco Energi Mining Internasional
- Deloitte Consulting - India
- Gujarat Mineral Development Corp Ltd - India
- Lanco Infratech Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- White Energy Company Limited
- Manunggal Multi Energi - Indonesia
- Merrill Lynch Commodities Europe
- Tata Chemicals Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Leighton Contractors Pty Ltd - Australia
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- GAC Shipping (India) Pvt Ltd
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Salva Resources Pvt Ltd - India
- Interocean Group of Companies - India
- Straits Asia Resources Limited - Singapore
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Standard Chartered Bank - UAE
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- Kapuas Tunggal Persada - Indonesia
- Orica Mining Services - Indonesia
- SMG Consultants - Indonesia
- Riau Bara Harum - Indonesia
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Globalindo Alam Lestari - Indonesia
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- Kumho Petrochemical, South Korea
- Krishnapatnam Port Company Ltd. - India
- Vedanta Resources Plc - India
- Goldman Sachs - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Power Finance Corporation Ltd., India
- London Commodity Brokers - England
- Dalmia Cement Bharat India
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Semirara Mining Corp, Philippines
- Uttam Galva Steels Limited - India
- Thai Mozambique Logistica
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Malabar Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- Bukit Baiduri Energy - Indonesia
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Thiess Contractors Indonesia
- Coal and Oil Company - UAE
- Wood Mackenzie - Singapore
- Agrawal Coal Company - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sinarmas Energy and Mining - Indonesia
- Barasentosa Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- PTC India Limited - India
- Antam Resourcindo - Indonesia
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- Therma Luzon, Inc, Philippines
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- Sakthi Sugars Limited - India
- Mintek Dendrill Indonesia
- ICICI Bank Limited - India
- Directorate Of Revenue Intelligence - India
- Jindal Steel & Power Ltd - India
- GMR Energy Limited - India
- Bulk Trading Sa - Switzerland
- Meralco Power Generation, Philippines
- Australian Commodity Traders Exchange
- OPG Power Generation Pvt Ltd - India
- Star Paper Mills Limited - India
- Ministry of Mines - Canada
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Formosa Plastics Group - Taiwan
- Cigading International Bulk Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Energy Link Ltd, New Zealand
- IHS Mccloskey Coal Group - USA
- Australian Coal Association
- Sojitz Corporation - Japan
- Bhushan Steel Limited - India
- Eastern Coal Council - USA
- Altura Mining Limited, Indonesia
- Banpu Public Company Limited - Thailand
- Grasim Industreis Ltd - India
- Makarim & Taira - Indonesia
- Bhoruka Overseas - Indonesia
- Independent Power Producers Association of India
- Toyota Tsusho Corporation, Japan
- Siam City Cement PLC, Thailand
- Economic Council, Georgia
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Indian Energy Exchange, India
- AsiaOL BioFuels Corp., Philippines
- Coalindo Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Kepco SPC Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- McConnell Dowell - Australia
- Videocon Industries ltd - India
- Chettinad Cement Corporation Ltd - India
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- Central Electricity Authority - India
- Renaissance Capital - South Africa
- Coastal Gujarat Power Limited - India
- Romanian Commodities Exchange
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- Africa Commodities Group - South Africa
- ASAPP Information Group - India
- Georgia Ports Authority, United States
- The University of Queensland
- Indika Energy - Indonesia
- Sical Logistics Limited - India
- Timah Investasi Mineral - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- South Luzon Thermal Energy Corporation
- Bharathi Cement Corporation - India
- Larsen & Toubro Limited - India
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Borneo Indobara - Indonesia
- Aboitiz Power Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- CIMB Investment Bank - Malaysia
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