20 million tons of coal undetected: official

The reluctance of regional governments to report the contracts they issue to coal companies have made the central government unable to get accurate figures of the national coal production, a senior governmental official said on Friday.

MS Marpaung, the director of mineral and coal business development at the Ministry of Energy and Mineral Resources, said the government?s official record put the nation?s coal output at 155 million tons last year. In fact, the real amount is higher.

?Coal output that is not reported to the central government is estimated to total 20 million tons per year,? he said.

Under the autonomy law, a regency administration is allowed to issue mining contracts to investors.

According to Marpaung, the regencies that are reluctant or refuse to report their coal production are mostly situated in Central and South Sumatra and Kalimantan.

?In fact, we have repeatedly asked them to report to us,? Marpaung said.

Regencies have issued a lot of mining exploration and exploitation licenses since they were given such a right in 2001. The Kutai regency in East Kalimantan, for instance, issued 80 licenses within two months after the licensing right was awarded to regencies.

Marpaung warned that the situation could result in an oversupply in the market and as such potentially put the price of coal under pressure.

Coal price remains high at present mainly because of the high price of oil, he said. Should oil price goes down, coal price could collapse due to an oversupply, he said. (Godang)