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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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Friday, 25 November 11
DISPUTE BETWEEN GIANT MINING FIRMS ENDS IN LAHAT - THE JAKARTA POST
The Jakarta Post reported that, prolonged dispute taking place in the South Sumatra regency of Lahat and involving two giant mining companies PT Buk ...
Friday, 25 November 11
DRY BULK MARKET LOSING STEAM, FAST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
It’s been a week of falls for the dry bulk market this one, leaving ship owners with a sour taste in their mouths, as evidence of a recovery i ...
Thursday, 24 November 11
INDONESIA/INDIA SPMX TC AROUND $ 7/8K AND AROUND $ 12/13.00 PMTS ON VOYAGE BASIS - FEARNLEYS
Handy
Last week ended on a positive note in the Atlantic however the activity levels are somewhat reduced. Owners are asking in excess of USD ...
Thursday, 24 November 11
DRY BULK MARKET KEEPS LOSING STEAM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was lower once again on Wednesday, with the industry’s benchmark, the Baltic Dry Index (BDI) ending the session down by 1. ...
Tuesday, 22 November 11
NTPC TO BUY 2 MMT OF IMPORTED COAL FOR ITS FOUR PLANTS
COALspot.com - NTPC Limited, incorporated in 1975 as a public sector company wholly owned by Government of India, the largest thermal power generati ...
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- Coal and Oil Company - UAE
- Sindya Power Generating Company Private Ltd
- Sree Jayajothi Cements Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Eastern Coal Council - USA
- Madhucon Powers Ltd - India
- Samtan Co., Ltd - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Karaikal Port Pvt Ltd - India
- Planning Commission, India
- Toyota Tsusho Corporation, Japan
- Jorong Barutama Greston.PT - Indonesia
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Bhoruka Overseas - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mjunction Services Limited - India
- Ambuja Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Mintek Dendrill Indonesia
- GVK Power & Infra Limited - India
- Thiess Contractors Indonesia
- Formosa Plastics Group - Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Marubeni Corporation - India
- White Energy Company Limited
- IHS Mccloskey Coal Group - USA
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Parliament of New Zealand
- India Bulls Power Limited - India
- Savvy Resources Ltd - HongKong
- Cigading International Bulk Terminal - Indonesia
- Meenaskhi Energy Private Limited - India
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Attock Cement Pakistan Limited
- Economic Council, Georgia
- Standard Chartered Bank - UAE
- Ministry of Transport, Egypt
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Indo Tambangraya Megah - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Videocon Industries ltd - India
- Aditya Birla Group - India
- Salva Resources Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Therma Luzon, Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indika Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- Kumho Petrochemical, South Korea
- Sinarmas Energy and Mining - Indonesia
- Carbofer General Trading SA - India
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Gujarat Sidhee Cement - India
- Asmin Koalindo Tuhup - Indonesia
- Iligan Light & Power Inc, Philippines
- Jindal Steel & Power Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Parry Sugars Refinery, India
- Petrochimia International Co. Ltd.- Taiwan
- Globalindo Alam Lestari - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Manunggal Multi Energi - Indonesia
- Bulk Trading Sa - Switzerland
- Ministry of Mines - Canada
- Ministry of Finance - Indonesia
- Electricity Authority, New Zealand
- Orica Mining Services - Indonesia
- ASAPP Information Group - India
- Price Waterhouse Coopers - Russia
- Holcim Trading Pte Ltd - Singapore
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Siam City Cement PLC, Thailand
- South Luzon Thermal Energy Corporation
- Vedanta Resources Plc - India
- Energy Link Ltd, New Zealand
- Riau Bara Harum - Indonesia
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- CIMB Investment Bank - Malaysia
- Sojitz Corporation - Japan
- Straits Asia Resources Limited - Singapore
- Chettinad Cement Corporation Ltd - India
- Maheswari Brothers Coal Limited - India
- Interocean Group of Companies - India
- Tamil Nadu electricity Board
- Kepco SPC Power Corporation, Philippines
- Baramulti Group, Indonesia
- Singapore Mercantile Exchange
- Wilmar Investment Holdings
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Kobexindo Tractors - Indoneisa
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Makarim & Taira - Indonesia
- The State Trading Corporation of India Ltd
- Bharathi Cement Corporation - India
- Bukit Baiduri Energy - Indonesia
- GMR Energy Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Chamber of Mines of South Africa
- Intertek Mineral Services - Indonesia
- Semirara Mining Corp, Philippines
- Merrill Lynch Commodities Europe
- Bhushan Steel Limited - India
- Star Paper Mills Limited - India
- Edison Trading Spa - Italy
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- London Commodity Brokers - England
- Leighton Contractors Pty Ltd - Australia
- McConnell Dowell - Australia
- Uttam Galva Steels Limited - India
- Billiton Holdings Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- The University of Queensland
- Independent Power Producers Association of India
- International Coal Ventures Pvt Ltd - India
- PTC India Limited - India
- CNBM International Corporation - China
- Mercuria Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Simpson Spence & Young - Indonesia
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Bangladesh Power Developement Board
- Central Java Power - Indonesia
- Indian Energy Exchange, India
- Alfred C Toepfer International GmbH - Germany
- Wood Mackenzie - Singapore
- Altura Mining Limited, Indonesia
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Global Business Power Corporation, Philippines
- Oldendorff Carriers - Singapore
- Central Electricity Authority - India
- Latin American Coal - Colombia
- Commonwealth Bank - Australia
- Rashtriya Ispat Nigam Limited - India
- Renaissance Capital - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Goldman Sachs - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Cement Manufacturers Association - India
- Medco Energi Mining Internasional
- ICICI Bank Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Meralco Power Generation, Philippines
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Heidelberg Cement - Germany
- Posco Energy - South Korea
- Gujarat Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- LBH Netherlands Bv - Netherlands
- Borneo Indobara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Indonesian Coal Mining Association
- TeaM Sual Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Antam Resourcindo - Indonesia
- Dalmia Cement Bharat India
- Vizag Seaport Private Limited - India
- Power Finance Corporation Ltd., India
- MS Steel International - UAE
- Kartika Selabumi Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Indian Oil Corporation Limited
- Trasteel International SA, Italy
- Australian Commodity Traders Exchange
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- Grasim Industreis Ltd - India
- VISA Power Limited - India
- Agrawal Coal Company - India
- Sical Logistics Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Deloitte Consulting - India
- Kaltim Prima Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- IEA Clean Coal Centre - UK
- European Bulk Services B.V. - Netherlands
- Kideco Jaya Agung - Indonesia
- Georgia Ports Authority, United States
- Karbindo Abesyapradhi - Indoneisa
- Romanian Commodities Exchange
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