Finance Ministry wants to be involved in mine contracts renegotiation

The finance ministry has not yet been involved in the renegotiation of mining contracts proposed by President Susilo Bambang Yudhoyono recently, Finance Minister Agus Martowardojo has said.

The finance minister said in Jakarta on Wednesday that as the renegotiation of the mining contracts were proposed not only to create a better mechanism in protecting the environment, but also to enable the state to receive fairer income distribution, the finance ministry should be involved.

?The finance ministry should be involved because it has the responsibility in managing the state finance,? he was quoted as saying by Kontan business daily.

Coordinating Minister for the Economy Hatta Rajasa said earlier that the government would form a special team in the renegotiations of the mining contracts. The team will work under the coordination of energy and mineral ministry and home affairs ministry.

Meanwhile, Director General of Mineral and Coal at the Energy and Mineral Resources, Thamrin Sihite said in Jakarta recently that besides reviewing the royalty payment, the renegotiations would also be held to ensure that all the mining contracts complied with the 2009 mining law.

Under the new law, the mining companies should, for example, export their mine output in the form of processed products, he said. He also said that the contracts awarded to foreign mining companies had caused disadvantages to the state because the royalties they paid were still too small. (*)