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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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Wednesday, 16 November 11
A STRONG WEEK FOR THE CAPES - BRS
A sharp bounce by the Cape market pushed the BDI up by 3% last week. This was despite a softening in the other indices with the Panamax, Supramax an ...
Monday, 14 November 11
BORL SEEKS 660K MT OF LOW SULPHUR COAL
COALspot.com - BORL India has issued a tender for around 660,000 MT of 4500 - 5500 kcal/kg sub-bituminous Coal.
Bharat Oman Refineries Ltd ...
Sunday, 13 November 11
BUNKER PRICES REMAINED FIRM
COALspot.com - The market seemed to recover this week with the BDI and Cape Index up.
The BDI was up by only about 2.86 pct closing at 1835 point ...
Saturday, 12 November 11
COALINDO ENERGY LAUNCHED INDEX FOR 3400 GAR COAL
COALspot.com - PT Coalindo Energy, in cooperation with Argus Media Limited, launched the coal index for low-rank coal with a calorific value of 3,40 ...
Saturday, 12 November 11
BBJ WILL RELEASE A COAL CONTRACT
Jakarta Futures Exchange will soon release a coal futures contracts during the quarter 1 / 2012.
Director of the Jakarta Futures Exchange (BBJ) S ...
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- Semirara Mining and Power Corporation, Philippines
- Videocon Industries ltd - India
- OPG Power Generation Pvt Ltd - India
- Sojitz Corporation - Japan
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- Bhatia International Limited - India
- Goldman Sachs - Singapore
- Billiton Holdings Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- Medco Energi Mining Internasional
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- The University of Queensland
- Cement Manufacturers Association - India
- Sinarmas Energy and Mining - Indonesia
- Petron Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- London Commodity Brokers - England
- Africa Commodities Group - South Africa
- Makarim & Taira - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Globalindo Alam Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- Bhushan Steel Limited - India
- Gujarat Mineral Development Corp Ltd - India
- International Coal Ventures Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Baiduri Energy - Indonesia
- Indian Oil Corporation Limited
- Directorate General of MIneral and Coal - Indonesia
- Trasteel International SA, Italy
- Siam City Cement - Thailand
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Rashtriya Ispat Nigam Limited - India
- Oldendorff Carriers - Singapore
- Banpu Public Company Limited - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Carbofer General Trading SA - India
- Ambuja Cements Ltd - India
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- The Treasury - Australian Government
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- Mercator Lines Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Singapore Mercantile Exchange
- Siam City Cement PLC, Thailand
- Electricity Authority, New Zealand
- Riau Bara Harum - Indonesia
- Grasim Industreis Ltd - India
- Pendopo Energi Batubara - Indonesia
- Economic Council, Georgia
- Sindya Power Generating Company Private Ltd
- GAC Shipping (India) Pvt Ltd
- Iligan Light & Power Inc, Philippines
- PowerSource Philippines DevCo
- Commonwealth Bank - Australia
- Global Green Power PLC Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Therma Luzon, Inc, Philippines
- Heidelberg Cement - Germany
- Wood Mackenzie - Singapore
- Bulk Trading Sa - Switzerland
- Wilmar Investment Holdings
- Bank of Tokyo Mitsubishi UFJ Ltd
- GVK Power & Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Chettinad Cement Corporation Ltd - India
- Parliament of New Zealand
- Orica Mining Services - Indonesia
- Indika Energy - Indonesia
- Georgia Ports Authority, United States
- Manunggal Multi Energi - Indonesia
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- VISA Power Limited - India
- South Luzon Thermal Energy Corporation
- Tata Chemicals Ltd - India
- Sical Logistics Limited - India
- Metalloyd Limited - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Xindia Steels Limited - India
- Thai Mozambique Logistica
- Gujarat Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Miang Besar Coal Terminal - Indonesia
- Global Business Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Tamil Nadu electricity Board
- Parry Sugars Refinery, India
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Star Paper Mills Limited - India
- Formosa Plastics Group - Taiwan
- Semirara Mining Corp, Philippines
- Malabar Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Standard Chartered Bank - UAE
- Samtan Co., Ltd - South Korea
- IEA Clean Coal Centre - UK
- Alfred C Toepfer International GmbH - Germany
- Planning Commission, India
- Mjunction Services Limited - India
- Ministry of Transport, Egypt
- CNBM International Corporation - China
- Bharathi Cement Corporation - India
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Kapuas Tunggal Persada - Indonesia
- GMR Energy Limited - India
- Barasentosa Lestari - Indonesia
- Simpson Spence & Young - Indonesia
- Orica Australia Pty. Ltd.
- Vedanta Resources Plc - India
- Indonesian Coal Mining Association
- Salva Resources Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- White Energy Company Limited
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- IHS Mccloskey Coal Group - USA
- Marubeni Corporation - India
- Central Java Power - Indonesia
- Bangladesh Power Developement Board
- Meenaskhi Energy Private Limited - India
- Kartika Selabumi Mining - Indonesia
- SMC Global Power, Philippines
- Leighton Contractors Pty Ltd - Australia
- Kaltim Prima Coal - Indonesia
- Energy Development Corp, Philippines
- Bhoruka Overseas - Indonesia
- Meralco Power Generation, Philippines
- Toyota Tsusho Corporation, Japan
- Baramulti Group, Indonesia
- Independent Power Producers Association of India
- Posco Energy - South Korea
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Ministry of Finance - Indonesia
- ICICI Bank Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- Ministry of Mines - Canada
- Agrawal Coal Company - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Energy - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Energy Link Ltd, New Zealand
- Bukit Makmur.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Romanian Commodities Exchange
- India Bulls Power Limited - India
- Intertek Mineral Services - Indonesia
- Coalindo Energy - Indonesia
- Minerals Council of Australia
- Karaikal Port Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Anglo American - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Latin American Coal - Colombia
- Bukit Asam (Persero) Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Straits Asia Resources Limited - Singapore
- Merrill Lynch Commodities Europe
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- SN Aboitiz Power Inc, Philippines
- ASAPP Information Group - India
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Gujarat Sidhee Cement - India
- Deloitte Consulting - India
- Mercuria Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Kalimantan Lumbung Energi - Indonesia
- Essar Steel Hazira Ltd - India
- Cigading International Bulk Terminal - Indonesia
- McConnell Dowell - Australia
- Australian Commodity Traders Exchange
- Uttam Galva Steels Limited - India
- Chamber of Mines of South Africa
- Jaiprakash Power Ventures ltd
- Vizag Seaport Private Limited - India
- Timah Investasi Mineral - Indoneisa
- Jindal Steel & Power Ltd - India
- Madhucon Powers Ltd - India
- Sakthi Sugars Limited - India
- Power Finance Corporation Ltd., India
- Larsen & Toubro Limited - India
- TeaM Sual Corporation - Philippines
- Australian Coal Association
- Indogreen Group - Indonesia
- Borneo Indobara - Indonesia
- Electricity Generating Authority of Thailand
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