PTBA to pay contribution of Rp1,000 for each ton of coal

State owned coal producer PT Tambang Batubara Bukit Asam (PTBA), which operates massive coal concession areas in Muara Enim, South Sumatra, has agreed to pay contribution of Rp 1,000 (1$=Rp9,000) for every ton of the company?s coal production to the local authority, Kompas reported on Tuesday.

With the company?s annual production of between 10 million and 11 million tons, the contribution would reach about Rp 10 billion a year. About 50 percent of the contribution will go to the provincial administration, while Muara Enim and Lahat regencies where most of the company?s concession areas are located would receive 25 percent each.

South Sumatra governor Rosihan Arsyad said in Palembang on Monday that the agreement on the contribution payment was made during the meeting between the coal producer?s management and the local authority and the province?s legislative council in January.

"The province?s legislative council is till preparing for a regulation which will be used as the basis of the contribution payment," he said.

The contribution will not include taxes and royalties currently paid by PTBA to the central government and the provincial administration. (*)