Ministry warns miners to complete contract amendment this year

By Thomas Sembiring

The Directorate General of Mineral and Coal at the Ministry of Energy and Mineral Resources has warned miners to complete the ongoing mining contract amendment process this year or there will be consequences.

Director General of Mineral and Coal Bambang Gatot Ariyono said that renegotiation process for the contract amendment has been ongoing for seven years, and therefore the government would no longer tolerate further delay.

?If no agreement (for contract amendment) can be reached, the government can say ?take it or leave it?. If they decline to take it (agree to the proposed changes to their contracts), we will think of what consequences (to be applied) in line with the existing regulations,? he said late last week.

According to the 2009 Mining Law, the mining contract amendment should have been completed within in a year. Previous deadlines set by the government have been repeatedly missed, without sanctions.

Among of the tough issues in the mining contract renegotiation process is the requirement for miners to follow prevailing tax regulations under the new contract, instead of a nailed down system.

Of the 34 mineral mining companies undergoing renegotiation process with the government, only 10 have signed mining contract amendment, while of 73 coal miners holding the so-called mining contracts of work (PKP2B), only 22 have amended their contracts.

Editing by Reiner Simanjuntak