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Indonesian Coal Mining Association Calls For Revision Of Domestic Market Obligation Plan

Date:29/11/2018   View: 451   Tags: Coal Mining Association Indonesian Revision
Recently, the Indonesian Coal Mining Association (APBI) called on the Indonesian government to revise the Domestic Market Obligation (DMO) plan, which requires coal producers to supply at least 25% of production to the Indonesian domestic market at a fixed price of no more than US$70/ton.
Pandu P. Sjahrir, president of the Indonesian Coal Mining Association, proposed to amend the plan to require coal companies to pay non-tax state taxes as an alternative to existing plans.
“Not all varieties of coal can be absorbed by the local industry, especially the state-owned electricity company Indonesia National Electric Company (PLN),” he said.
Helier said that the requirement that coal companies to sell 25% of coal to China would have a negative impact on coal production, because coal companies often reduce production due to this requirement.
He also said that this situation is getting worse as coal prices in the global market fall. Therefore, Hellil expects that coal production will decline further next year if the existing domestic market obligations are not revised.
The Ministry of Energy and Mineral Resources of Indonesia plans to produce 506.9 million tons of coal in 2018. The actual output in the first ten months of this year was 409.9 million tons. Among them, coal enterprises set aside 90.71 million tons of coal for fulfilling domestic market obligations, and the annual target is 121 million tons.
However, Bambang Gatot Ariyono, director of the Coal and Minerals Division of the Ministry of Energy and Mineral Resources, said that the current plan will remain in place next year.

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