re: china to ban import of low rank coal <4... Another "smart"...

re: china to ban import of low rank coal <4... Another "smart" idea to threaten the profits of low rank coal producers. Producers of higher-quality coal may be more able to absorb the extra royalty costs. In the end such a move hollows regulatory certainty in Indonesia.


"Indonesia's Ministry of Energy and Mineral Resources plans to set royalties for all types of coal at 13.5 percent (of net sales) as part of a revision of Government Regulation No. 9 - 2012 on Tariff and Types of Non-Tax Revenue. Currently, the percentage of royalty depends on the quality of the coal that is extracted as well as the type of permit that is issued to the coal miner. Apart from higher coal royalties, the Indonesian government also proposes a windfall profits tax in case there is a sharp upward price correction. The two types of permits that are issued by the (local) government to coal miners are the Mining Business License (Ijin Usaha Pertambangan licenses, or IUPs) and Coal Contracts of Work (Perjanjian Karya Pengusahaan Pertambangan Batubara, PKP2B). The royalty for PKP2B is already set at 13.5 percent, while those for IUPs depends on the quality of the coal. IUP-holders with a coal quality of below 5.100 cal/gram pay 3 percent, between 5.100 and 6.100 cal/gram pay 5 percent and over 6.100 cal/gram pay 7 percent as royalty."

http://www.indonesia-investments.com/doing-business/business-columns/government-of-indonesia-plans-to-raise-coal-royalties-for-miners/item1671