Strange, mining DG does not know coal fund

The amount and use of the coal funds - collected from coal contractors - has never been clear, even to the government itself that manages the fund.

Director General of General Mining Surna Tjahja Djajadiningrat said he also did not know where the money was deposited, and therefore, he could not use the fund to help PT Tambang Batubara Bukit Asam to maintain its Ombilin Sawahlunto mining whose open pit reserves had been depleted.

"I don't know where the fund is, and up until now, It has never been clear to me," he said. Minister of Mines and Energy Susilo Bambang Yudhoyono used to report to the House of Representatives that the coal fund - collected from the government's portion of income from coal mining companies, namely 13.5 percent of coal sales - totaled Rp 985.86 as of the end of 1999.

The fund was projected to increase to Rp 1.3 trillion this year.

However, some sources said that the amount of the fund had actually reached Rp 5 trillion.

Surna said that initially he wanted to use the fund to help PT Bukit Asam, but because the fund was not available, he offered the Ombilin mining field to Sawahlunto administration to take over the concession.

However, the Sawahlunto administration did not want to take it because of the depleting coal open pit reserves in Ombilin.

According to the head of the Bukit Asam Labor Union's Ombilin branch, Edimar, investors - including Sawahlunto administration - were not attracted to invest in Ombilin because of widespread illegal mining activities and high investment for pit mining activities.

The only way to keep Ombilin producing is using the coal fund, Edimar said.

The coal fund was introduced in 1993 through Presidential Decree No. 21/1993 that ordered coal contractors to hand over 13.5 percent of their coals to state coal miner PT Batubara Bukit Asam.

The state coal miner then sold the coals, but the revenues from the coal sales was not transferred to the government, but it used all of them by itself. And the usage of the funds had never been transparent to the public.

Then minister of mines and energy I.B. Sudjana asked then former president Habibie to issue a presidential decree to requires all coal contractors to transfer the coal fund directly to state coffer in cash rather than in the form of coal to PT BA. Then, a presidential decree was issued, and all coal contractors are required to transfer their coal fund to a state account managed by the Ministry of Finance. (*)