Fri, 25 Feb 2011


By Bambang Djanuarto & Eko Listiyorini
Indonesia, the world’s top supplier of thermal coal, has issued more trading permits that will allow traders to export coal and metals stuck at ports since January, an energy ministry official said.

The Energy and Mineral Resources Ministry has awarded a total of 101 trading licenses, an increase from 60 earlier this month, out of 338 applications, Bambang Gatot Ariyono, the director of mining development at the ministry, said on Thursday.

Some coal traders declared force majeure on shipments when the government blocked exports of at least 3.5 million tons of the fuel after Jan. 15 following a delay in a ministerial decree issuing trading permits, Bob Kamandanu, the chairman of the Indonesian Coal Mining Association (APBI), said on Feb. 1.

Force majeure is a legal clause that allows producers to miss deliveries due to circumstances beyond their control.

Indonesia’s mining law of 2009 requires traders to convert their old permits into licenses from the Energy Ministry before they send materials overseas. The government has since 2008 also ordered that all shipments of coal, metal ores and concentrate to be verified by state-appointed surveyors as part of its efforts to clamp down on illegal exports.

Traders have until April 19 to submit applications to an inter-ministerial team that was formed to verify traders’ applications, according to Djunaedi, head of mining exports at the ministry.

Ariyono and Djunaedi declined to give details of how much coal and metals have been exported following the issue of the permits or when the backlog would be completely clear.

Indonesia raised the reference price for coal sales this month by 13 percent compared with January to $127.05 per ton, according to data compiled by Bloomberg News. That is the steepest increase since the country introduced the benchmark in February last year.