Geothermal owners refuse to give reject local administration?s share

Indonesian Geothermal Association (APBI) has rejected the government?s intention to give a 34 percent share out side the net operating income of a company to local administration, the Investor Daily Indonesia reported in its Tuesday edition.

According to APBI, the plan will affect badly geothermal business players and it is not there in the Law No. 27/2003 on Geothermal.

?If the local administration?s share is 34 percent outside net profit, it actually means the geothermal businesses are given disincentive. In case the buying price of geothermal steam can be raised from the present 5.1 U.S. cents per kwh, it will most probably reach the government?s figure,? APBI executive Riky F. Ibrahim told the Investor recently in Jakarta.

Riky, who is from Amoseas Indonesia Incorporation, said the local administration? share must be taken from the 34 percent of the net profit given to the central government.

?All these times, geothermal companies implemented community development in the areas near the geothermal sites. It seems the size of the figure is less optimal,? Riky admitted.

While responding to the APBI?s comment, Ministry of Energy and Mineral Resources?s Directorate General secretary for Coal and Geothermal Sukhyar said the government is still discussing the issue with all relevant parties.

?So far, we are still hoping local administration share must be taken from outside of our 34 percent share. We promise, there will be some type of incentives,? Sukhyar said. (*)