Govt, KPK Hunt Down Non-Compliant Mining Companies

Kartini Laras Makmur, Andin Aditya Rahman
 
As part of continued efforts to uncover non-compliant mining companies in Indonesia’s mining sector, the Ministry of Energy and Mineral Resources (ESDM) and the Corruption Eradication Commission (KPK) have vowed to take assertive measures against mining license holders that persistently fail to pay mining royalties.
 
Paul Lubis, Director of the Mineral and Coal Program Development at the ESDM, declared that his institution and the KPK will not hesitate to use judicial proceedings and the justice system against mining companies that intentionally fail to pay mining royalties.
 
“With the KPK’s support, we are now focused in creating order for mining activities operating in 12 provinces,” stated Mr. Lubis in Jakarta last Friday.
 
These 12 provinces include Kalimantan Timur, Kalimantan Selatan, Kalimantan Barat, Kalimantan Tengah, Sulawesi Tengah, Sulawesi Tenggara, Sulawesi Selatan, Maluku Utara, Kepulauan Riau, Jambi, Sumatera Selatan and Bangka Belitung. From these provinces, said Mr. Lubis, the Government should receive a total of IDR 1.5 trillion in mining royalties this year.
 
“If during this year there are corporations that still fail to fulfill their obligations, the Government will hand the matter over to law enforcers. We will therefore coerce corporations that have yet to pay their obligations,” asserted Mr. Lubis.
 
In addition, Mr. Lubis also indicated the Government’s intentions in increasing coal royalties. He explained that the fundamental principle is equality between IUP (mining license) holders and parties to a PKP2B (Coal Mining Business Working Agreement). Mr. Lubis emphasized that although the royalties will be increased, the increase will be at a later date when circumstances better permit.
 
As expected, the plan to increase mining royalties, has met with objections from many pundits. Mining expert Abrar Saleng said that the Government must take into consideration numerous factors before implementing any increases including prices, content and volume.
 
“In my opinion, if these three elements are fulfilled, i.e. prices are increasing, there is good content and equivalent volume, then increasing the royalty will not be a problem and should be implemented,” he explained.
 
Furthermore, transparency and honesty from both the Government and mining companies is essential. Mr. Saleng explained that the Government must provide clear reasons for increasing coal royalties, and mining corporations must be honest about their finances.
 
“All must be honest and transparent,” he concluded.
 
(hot/kc)