Illegal mining activities in Ombilin bring total loss of Rp 7.7 billion
Local government refuses to take over the high-cost mining site
Saturday, July 15 2000 - 04:00 AM WIB
Illegal mining activities in Ombilin coal mining area in West Sumatra have caused a loss amounting to at least Rp 7.7 billion (1US$= Rp 9,000) to the state owned coal mining operator PT Bukit Asam.
Director general of general mining at the ministry of mines and energy Surna Tjahya Djajadiningrat said in Jakarta on Friday that the loss suffered by the coal mining company could further inflate in the future as the illegal mining activities in the area continued growing.
He said that at present at least 200 people were involved in the illegal coal mining activities covering an area of over 15.5 square kilometers. "The illegal miners produce at least one ton of coal each every day," he added.
Surna said that the company had offered a number of cooperation schemes to illegal miners in a bid to curb the illegal mining activities but to no avail as the miners still preferred to sell their coal to local traders. He said that the local government either in the provincial level or in the regency level had been asked to find out other cooperation schemes that could attract the illegal miners.
"We have to find out ways that could bring the illegal mining activities as an integral part of the company's operation," he said.
The Ombilin coal mining, located in Sawahlunto, West Sumatera, is part of the state owned PT Bukit Asam, which focuses most of its operation in South Sumatera. The company plans to divest its Ombilin operation as part of its privatization program that is expected to be completed this year.
Bukit Asam will no longer include the Ombilin mining site into its operation because the production cost at the open pit mining site has been too expensive. Maintaining the mining site might affect the soundness of Bukit Asam's profitability.
However, the local government refused to take over the mining site on fears that operating the mining area would only bring additional burden to the provincial budget. "We are very concerned about the future about this mining site, especially about the fate of about its 400 employees," Surna said.
He said that the mining site could be put under the management of the government-funded Ombilin Mining Training Center. "The most important thing for us is how to continue to the operation of the mining site," he said. (*)