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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, 01 December 11
DRY BULK MARKET RISES TO NEW HEIGHTS ON RENEWED DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept on rising this week, with the industry’s benchmark, the Baltic Dry Index (BDI) climbing to 1,846 points on Wednes ...
Tuesday, 29 November 11
SOUTH AFRICAN COAL INTO CHINA, THE ACTIVITY WAS SLOW - BRS
Capesize
The Capesize market in Atlantic stayed pretty firm last week with transatlantic rounds being fixed in the high twenties. Sentiment was les ...
Tuesday, 29 November 11
GOLDEN GATE BRIDGE OF INDONESIA COLLAPSED AT KUKAR, EAST KALIMANTAN
COALspot.com - A suspension bridge in Indonesia’s east Kalimantan province over the Mahakam river collapsed on Saturday, killing at least elev ...
Tuesday, 29 November 11
BUKIT ASAM SCOUTS RP3 TRILLION PROFIT - INSIDER STORIES
The state-controlled coal miner PT Bukit Asam Tbk (PTBA) expects to post a Rp3 trillion net income this year, reaching its target which is 50% above ...
Tuesday, 29 November 11
DRY BULK MARKET BEGINS WEEK ON HIGHER NOTE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Contrary to what had been the case during the past few weeks, this one began on a high note for the dry bulk market, with the Capesize sector pullin ...
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- Anglo American - United Kingdom
- Binh Thuan Hamico - Vietnam
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- Port Waratah Coal Services - Australia
- Videocon Industries ltd - India
- Bhatia International Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Indian Oil Corporation Limited
- Sarangani Energy Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- Thai Mozambique Logistica
- Baramulti Group, Indonesia
- Interocean Group of Companies - India
- IHS Mccloskey Coal Group - USA
- Global Coal Blending Company Limited - Australia
- Electricity Generating Authority of Thailand
- Kalimantan Lumbung Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Parliament of New Zealand
- Energy Development Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jindal Steel & Power Ltd - India
- Trasteel International SA, Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- Bukit Makmur.PT - Indonesia
- Orica Australia Pty. Ltd.
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Grasim Industreis Ltd - India
- Siam City Cement PLC, Thailand
- MS Steel International - UAE
- The State Trading Corporation of India Ltd
- SMG Consultants - Indonesia
- Sakthi Sugars Limited - India
- Tata Chemicals Ltd - India
- GMR Energy Limited - India
- Kaltim Prima Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Kepco SPC Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meralco Power Generation, Philippines
- Rio Tinto Coal - Australia
- Indian Energy Exchange, India
- Economic Council, Georgia
- GVK Power & Infra Limited - India
- Antam Resourcindo - Indonesia
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Eastern Coal Council - USA
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- PTC India Limited - India
- Gujarat Sidhee Cement - India
- Bangladesh Power Developement Board
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Indo Tambangraya Megah - Indonesia
- White Energy Company Limited
- Planning Commission, India
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Coalindo Energy - Indonesia
- Renaissance Capital - South Africa
- Miang Besar Coal Terminal - Indonesia
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- India Bulls Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- TeaM Sual Corporation - Philippines
- Central Java Power - Indonesia
- European Bulk Services B.V. - Netherlands
- Bulk Trading Sa - Switzerland
- Cigading International Bulk Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Kideco Jaya Agung - Indonesia
- Electricity Authority, New Zealand
- Orica Mining Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Coal Association
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Vedanta Resources Plc - India
- Price Waterhouse Coopers - Russia
- Madhucon Powers Ltd - India
- Africa Commodities Group - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Central Electricity Authority - India
- San Jose City I Power Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Indika Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Xindia Steels Limited - India
- Therma Luzon, Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- Makarim & Taira - Indonesia
- Marubeni Corporation - India
- Aditya Birla Group - India
- Essar Steel Hazira Ltd - India
- Mercator Lines Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Rashtriya Ispat Nigam Limited - India
- The Treasury - Australian Government
- Larsen & Toubro Limited - India
- Chettinad Cement Corporation Ltd - India
- Singapore Mercantile Exchange
- Standard Chartered Bank - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- Riau Bara Harum - Indonesia
- Star Paper Mills Limited - India
- Jorong Barutama Greston.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- Minerals Council of Australia
- The University of Queensland
- Energy Link Ltd, New Zealand
- SMC Global Power, Philippines
- Global Green Power PLC Corporation, Philippines
- Bhushan Steel Limited - India
- Sree Jayajothi Cements Limited - India
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Power Finance Corporation Ltd., India
- Directorate General of MIneral and Coal - Indonesia
- Independent Power Producers Association of India
- Ceylon Electricity Board - Sri Lanka
- Karaikal Port Pvt Ltd - India
- PowerSource Philippines DevCo
- Thiess Contractors Indonesia
- Coal and Oil Company - UAE
- Uttam Galva Steels Limited - India
- VISA Power Limited - India
- Edison Trading Spa - Italy
- Sical Logistics Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Vizag Seaport Private Limited - India
- Malabar Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Heidelberg Cement - Germany
- Aboitiz Power Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Mintek Dendrill Indonesia
- Cement Manufacturers Association - India
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- Semirara Mining Corp, Philippines
- Sojitz Corporation - Japan
- Posco Energy - South Korea
- Goldman Sachs - Singapore
- Ministry of Finance - Indonesia
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- Australian Commodity Traders Exchange
- Salva Resources Pvt Ltd - India
- Commonwealth Bank - Australia
- Ministry of Mines - Canada
- Banpu Public Company Limited - Thailand
- Pendopo Energi Batubara - Indonesia
- Eastern Energy - Thailand
- Holcim Trading Pte Ltd - Singapore
- Ind-Barath Power Infra Limited - India
- Chamber of Mines of South Africa
- Latin American Coal - Colombia
- Wood Mackenzie - Singapore
- Kohat Cement Company Ltd. - Pakistan
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- IEA Clean Coal Centre - UK
- Bharathi Cement Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Formosa Plastics Group - Taiwan
- CNBM International Corporation - China
- Toyota Tsusho Corporation, Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
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