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Indonesia suspends coal exports from 34 mining companies: Report

Indonesia suspends coal exports from 34 mining companies: Report

FILE PHOTO: A tug boat pulls a coal barge along the Mahakam River in Samarinda, East Kalimantan province, Indonesia, March 2, 2016. REUTERS/Beawiharta

JAKARTA: Indonesia has suspended coal exports from 34 coal mining companies it said failed to meet domestic market obligations between January and July this year, CNBC Indonesia reported on Monday (Aug 9), citing a government document.

Indonesia requires coal miners to sell 25 per cent of their production to the domestic market, mainly to state power utility PT Perusahaan Listrik Negara (PLN).

Failure to do so results in sanctions, including export suspension and fines. Citing a government document, CNBC Indonesia said 34 miners had been temporarily banned from exporting.

In an Aug 7 post on its website, the energy ministry said that sanctions had been issued on some companies for violating market rules, but did not name the firms or say how many would be affected by the measures.

Of the 34 companies listed in the document seen by CNBC Indonesia, four were members of the Indonesia Coal Miners Association (ICMA), the trade group's executive director Hendra Sinadia said.

"To our knowledge, the four companies gave separate assurance of their commitment to the government to meet their obligations before the document was issued," Hendra told Reuters.

The group supported the government action, but sought "structural improvements" to avoid similar problems in the future, he added.

"We support the user, in this case PLN, to carry out overall improvements, in terms of payment administration to suppliers, infrastructure at the jetty for the coal unloading process, inventory stock management, and so on," Hendra said.

Among the companies banned from exporting was PT Arutmin Indonesia, a unit of Indonesia's largest coal miner PT Bumi Resources, according to CNBC Indonesia.

"We are looking into resolving this expeditiously to continue exports," Bumi director Dileep Srivastava told Reuters.

Source: Reuters

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