Arutmin settles part of royalty arrear

Government said on Friday that South Kalimantan coal miner PT. Arutmin Indonesia had paid part of its 2002 and 2003 royalty payment arrears.

?Arutmin had paid US$5 million to central government two weeks ago. The company had promised to settle the remaining $13 million royalty arreas soon,? said Mahyudin Lubis, Director of Mining Enterprises at the Ministry of Energy and Mineral Resources.

Last month, South Kalimantan threatened to stop Arutmin?s export if the company failed to settle its $18 million arrear by the end of July. Provincial and regency administration is entitled to get around 50 percent of 13.5 percent royalty imposed on coal-producing companies operating under the coal contract of work.

Despite favorable coal prices, Autmin is known to have cashflow problems as its parent company PT. Bumi Resources has huge service obligation for its debts. (godang)