Another E. Kalimantan regent calls for simplification of royalty disbursement

An East Kalimantan regent on Thursday urged the government to simplify procedures of disbursing mining royalty funds to his region, local daily Kaltim Post reported.

Awang Faroek Ishak, regent of East Kutai, said existing standard procedures stipulate that royalty funds from mining companies go to the government through the Ministry of Energy and Mineral Resources which then passes them on to the Directorate General of Finance. The funds then go to the State Budget Directorate General at the Ministry of Finance, and eventually to state-owned Bank BNI before reaching the East Kutai administration.

?The funds follow a too long way to reach us. This hampers development in our area,? Awang told reporters in Jakarta. The official joined other regents from oil and gas producing regions who met with central government officials in the capital city.

Awang said royalty received by East Kutai included the one coming from coal mining giant PT Kaltim Prima Coal.

Meanwhile, Kutai Kartanegara regent Syaukani said on Wednesday mining royalty funds had too often reached them three months behind official schedule. Kutai Kartanegara is also part of East Kalimantan province.

?We request the government to speed up the disbursement process,? Syaukani said.

Under existing laws, provinces receive 80 percent of the royalty paid to the government by general mining firms, and 30 percent of the royalty paid by oil and gas firms. They are further split between the provincial administration and regency administration. (*)