Central Government Local Government

• exploration, mainly for 3 years period and can be extended twice for 1 year each • exploitation, processing and refining, transportation and sales, for maximum 30 years period and can be extended twice for 10 years each This condition is omitted for the company in term of PMA, the license is given once as a package.

1.1.1.2. Government Functionality;

Actually, the Government functionality based on the prevailing policy is as follows:

a. Central Government

- Proposing, determining, and updating national mineral management policies, guideline, standardization, norms, criteria, and procedures; - Socialization and technical guidance for environment, safety, added value and community development aspects, whether for local government, community and company; - Supervising and evaluating local government official performances in conducting mining services both deskwork and fieldwork, - Managing overlying license area between provinces and exceeding 12 miles of offshore area. - Monitoring and evaluating contractors performance in conducting their becoming obligations comprises; environmental, safety, added value, community development, taxes and financial aspects, both deskwork and fieldwork,

b. Local Government

- Managing coal and minerals resources under their authorities’ area. - Monitoring and evaluating company performance in conducting their becoming obligations comprises; environmental, safety, added value, community development, taxes and financial aspects, both deskwork and fieldwork, - Socialization and technical guidance of each aspects whether to local government, community or to company. 3 - Supervising the provincial and regional official in conducting mining services related to Regional Autonomy.

1.1.1.3. Company Responsibilities a. Implementing Good Mining Practices

Good Mining Practices is conducted by implementing appropriate method and compliance of any related prevailing regulations to create accountable mining, - Applying an effective and efficient mining method - Environmental eligibility, based on Environmental Impact Assessment EIM to keep the environment components as ambient condition and to meet environmental policies. - Added Value eligibility, concerning the company effort to improve their yield and condition such as conservation, quality, human aspect, community development and multiplying effect. - Safety and health occupancy of the employee, to avoid mining accident. - Standardization of any aspect of mining activities, whether operational procedure, equipment appropriateness, and official or operator competency; by referring to the national or international standards. - Economics eligibility to meet any finance and taxes obligations

b. Fulfilling Taxes and Other Financial Obligation