Central government defends Arutmin against governor?s threat

The central government defends coal miner PT Arutmin Indonesia against the South Kalimantan governor who has threatened to stop the firm's export for failure to pay mining royalty.

Simon F. Sembiring, Director General of Geology and Mineral Resources of the Ministry of Energy and Mineral Resources, urged the governor to drop the export ban threat.

?It is true that Arutmin has deferred its coal royalty payment. But, it has promised to pay, so don't ban it from exporting its coal,? Sembiring told Petromindo.com on Thursday, adding that governor had to respect the contract made by the central government and Arutmin.

South Kalimantan governor Sjachriel Darham repeatedly warned that his administration would ban the exports of coal mining companies which defaulted on royalties payable to the local government.

Sjachriel said the local administration would not issue the necessary certificate of origin (CO) to exporters if they fail to settle their royalty arrears by the end of next month.

"The deadline is end of July. No more bargaining," he said.

Four out of six coal mining firms operating in the province had a combined unpaid royalty of around Rp 500 billion. The largest offender is Arutmin, which owes around Rp 200 billion in unpaid royalty. The firms should have already paid the royalty at the end of last year. (godang)