Coal miners face risk of penalty following shipping ban

Indonesian coal miners holding contracts to supply coal to the Philippines are facing the risk of penalty after the Ministry of Transportation bans Indonesian-flagged vessels from travelling to the Philippines waters amid security concerns.

Director General of Mineral and Coal Bambang Gatot Ariyono was quoted by Bisnis Indonesia as saying Monday that delay in delivery may cause the coal miners to pay penalty.

He suggested that decision on whether to make coal shipment to the Philippines should be made by the miners themselves, not the government.

The directorate general of sea transportation finally banned last week Indonesian-flag ships from travelling to the Philippines after two Indonesian tug boats were attacked by the Abu Sayyaf rebel group, who also kidnapped seven crews

A few months ago, Indonesian tug boats had also been attacked by the rebel group, prompting the Indonesian Coal Mining Association (ICMA) to urge Indonesian coal miners to suspend export to the Philippines until security condition improves.

Suspension of export to the Philippines would not cause much impact as annual export volume to the Southeast Asian nation is relatively small. But it will hurt the Philippines which imports around 70 percent of its coal needs from Indonesia.

According to the Ministry of Energy and Mineral Resources, coal export volume to the Philippines last year totaled 7.6 million tons, down 3.6 percent from 7.9 million tons in 2014. Export volume in the first quarter of this year reached 300,000 tons. (*)