Cancelation of coal royalty hike to be decided by Hatta

Director General of Coal and Mineral R. Sukhyar retracted his earlier statement that the government has decided to cancel the planned coal royalty hike, saying that it must be reviewed again and that the decision lies in the hands of Coordinating Minister for the Economy Hatta Rajasa, Bisnis Indonesia daily reported on Friday.

?The plan (canceling the coal royalty hike) must be further reviewed. The argument of coal mining players ? of the current unfavorable coal price will be a consideration. Our position is only to provide consideration. The decision lies in the hands of the Office of the Coordinating Minister for the Economy,? Sukhyar said on Thursday.

Sukhyar was earlier quoted by the paper as saying that the government has decided to cancel the plan to increase the royalty tariff of coal miners holding the IUP mining license to 10-13.5 percent from the current 3-7 percent due to the lingering weak price of the commodity. But he said that once the coal price recovers, the coal players must agree to adjust upward the coal royalty.

Executive Director of the Indonesia Coal Mining Association (APBI), Supriatna Suhala said that the industry players have expressed objection to the planned coal royalty hike citing the current downturn in the global coal market, but quickly added that the government has yet to make a decision on whether to accept the argument of the miners.

?There has been no decision yet (to cancel the royalty hike). It?s still be reviewed. The decision will be made by the Office of the Coordinating Minister for the Economy,? he told Bisnis Indonesia. (*)