Two coal mining companies to quickly pay royalty arrears

Two mining companies including PT Multi Harapan Utamaand PT Allied Indo Coal are given until today to pay at least half of their royalty payment for 2004, Bisnis Indonesia daily reported on Friday.

"The two companies are given until Aug. 5 to pay at least a half of their royalty arrears," said Mahyuddin Lubis, the director for mineral resources department at the ministry of energy and mineral resources.

He said that the two firms had so far only paid 20 percent of their obligation.

The two firms were part of eight coal mining companies which were initially given until the end of July to settle at least 50 percent of their royalty arrears, but only some of them could meet the deadline.

The eight major coal mining companies include PT Arutmin Indonesia, PT Kaltim Prima Coal, PT Bahari Cakrawala Sebuku, PT Multi Harapan Utama, PT Tanito Harum, PT Allied Indo Coal, PT Antang Gunung Meratus and PD Baramata have a combined royalty obligation for 2004 estimated to reach a total of US$118.58 million and Rp 45.16 billion.

Up to July 31, only PT Tanito Harum Harum had settled all of its royalty arrears worth US$4.4 million. Five other companies including PT Arutmin Indonesia, PT Kaltim Prima Coal, PT Bahari Cakrawala, PT Antang Gunung Meratus and PD Baramata paid a half of their royalty arrears as required.

Under the existing regulation, the government receives 13.5 percent of coal production in royalties from coal mining companies, and 2.5 percent of net profits in royalties from gold and copper mining operations. (*)