Govt to impose lower royalty on low-rank coal

Ministry of Energy and Mineral Resources is proposing to lower royalty for coal miners to boost the economics of exploiting low-rank coal, a senior ministry official said on Monday.

Director General of Mineral, Coal and Geothermal Bambang Setiawan said government may impose 7.5-9% royalty for low-rank coal as opposed to 13.5% rate currently prevails to all coal miners under the Coal Contract of Work (CCoW).

Bambang said government will divide low rank coal into two categories ie: coal with CV between 4,500-5,100 kcal/kg (ADB) and those lower than 4,500kcal/kg. The lower the rank, the lesser the rate of the royalty imposed, he said.

He did not say when the regulation will be issued. (denny)