Eight coal mining companies in arrears of royalty payment

At least eight major coal mining companies including PT Arutmin Indonesia, PT Kaltim Prima Coal, PT Bahari Cakrawala Sebuku, PT Multi Harapan Utama, PT Tanito Harum, PT Allied Indo Coal, PT Antang Gunung Meratus and PD Baramata have not paid a larger part of their royalty obligation incurring since 2004.

According to the Ministry of Energy and Mineral Resources, their accumulated royalty arrears have reached a total of US$118.58 million and Rp 45.16 billion since 2004. Arutmin has royalty arrears of US$48.67 million, KPC (US$48.02 million), Multi Harapan (US$3.02 million and Rp 35.55 billion)), Tanito (US$2.41 million), PT Allied Indo (US$1.44 million and Rp 5.78 billion), PT Antang (US$1.02 million) and Baramata (Rp 3.83 billion).

Director General of Geology and Mineral Resources Simon F. Sembiring said in Jakarta on Wednesday that the eight companies should settle their unpaid royalties for 2004 by the end of this year. "At least half of the unpaid royalties have to be paid by the end of July, this month," he said.

Sembiring said that the unpaid royalties for 2005 should be also settled by the end of this year. "There should be no more royalty arrears this year," he added.

Sembiring said his office had summoned the representatives of the eight companies to discuss the royalty settlement early this month. "All, except the representative of PT Bahari who did not attend the meeting, agreed to settle the payment as required," he added.

Up to July 12, about US$8.33 million and Rp 2.17 billion of the unpaid royalties had been paid. KPC paid about US$6.33 million of its royalty arrears, Multi Harapan (US$2 million) and PT Allied Indocoal (Rp 723.75 million), while PD Baramata about Rp 1.33 billion.

Under the existing regulation, the government receives 13.5 percent of coal production in royalties from coal mining companies, and 2.5 percent of net profits in royalties from gold and copper mining operations. (godang/dino).