Indonesia is planning to remove royalty payments for coal used in domestic downstream sectors in an effort to push its coal processing industries to develop, according to a report by Reuters on February 21.
Reuters citing an official regulation pointed that the action aims to boost domestic coal processing industries and reduce its reliance on importing liquefied petroleum gas, and in the meantime, to streamline coal usage in Indonesia.
Companies usually pay 2% to 7% of calorific value of the coal to the central government in royalties, depending on the calorific value of the coal and if it has been mined from underground or open pit mines.
The regulation has taken effect on February 2. The country's energy ministry will issue further regulation to specify which processing activities will be exempt from royalties, but no timeline was given.
(Writing by Rebecca Liu Editing by Harry Huo)
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