ESDM Minister Amends Coal Mining Agreement With Ten Contractors

Jakarta (Antara Bali) - Energy and Mineral Resources (ESDM) Minister Sudirman Said has amended working contracts with ten coal mining companies.

"The points amended in the coal contracts are all chapters of agreement not in line with the Mineral and Coal Law including six strategic issues," the minister said here on Wednesday.

The six strategic issues include those related to working areas, continuation of mining operation, state revenues, processing and refining obligation , divestment obligation and obligation to use local workers, goods,  and services.

The minister said the amendment would have positive implication to increase in national share ownership with the divestment obligation of the contract holders.

Opportunity would be open for state owned companies and the Indonesian private companies to have greater participation, he said.

The limitation to concession areas for contractors  could also be utilized as a reserve for the state.

With the strategic reserve of mining area, the state will have potential addition of added value that the program of development in the downstream coal and mineral industry would be more competitive, he said.

"The commitment of the 10 companies to give priority to the use of  local workers , goods, and services is expected to increase the people's capacity and mastery of technology," he said. .

Meanwhile, Mineral and Coal Director General Bambang Gatot Aryono said with the fulfillment of financial obligations of the 10 companies, the state has a 6 to 9 percent increase in income as a result of the  sales of the government's 13.5 percent  share of coal in cash previously in coal.

The ten coal contractors taking part in the amendment to agreement are Indominco Mandiri in East Kalimantan, Trubaindo Coal Mining in East Kalimantan, Jorong Barutama Greston in South Kalimantan, Antang Gunung Meratus in South Kalimantan, Borneo Indobara in South Kalimantan, Gunung Bayan Pratama Coal in East Kalimantan, Kartika Selabumi Mining in East Kalimantan, Bahari Cakrawala Sebuku in South Kalimantan , Mandiri Intiperkasa  in North Kalimantan  and  Indexim Coalindo.

"The signing of the amendment constitutes a concrete step toward implementation of the Law No. 4 of 2009 that all coal contractors are required to immediately implement their obligations  and amend their contracts," Bambang said.

He said by October 2015, at least 107 coal contractors are expected to sign such amendment. (WDY)