30 Sumatra coal miners stop production

Up to 30 coal mining companies in South Sumatra have been forced to halt production as they cannot transport their output to the ports following the implementation of a regulation forbidding them to use public road.

Anggawira, Deputy Chairman of Association of Energy and Coal Suppliers (Aspebindo) at the province, said that the firms could only stockpile their output since January 1, adding that stockpile has now reached at least 2 million tons.

?Worse still, there are several companies that have been slapped with a penalty for failing to fulfill their supply commitment to their buyers,? Anggawira said as reported by Kontan. He added that potential losses up to now amounted to over Rp400 billion.

The ruling in question is the Regional Regulation No. 5/2011 on the Implementation of Coal and Mineral Mining Activities, which among others, bans trucks carrying coal and mineral products from using public road.

The regulation was enacted in 2011 and gives a 2-years transition period which means is effective starting 2013. However, according to Anggawira, the regulation was signed in March 2011, therefore it should be effective in March 2013, not in January 2013.(*)