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DAro EnErgy 2013 AnnuAl rEporT
231
PT ADARO ENERGY Tbk AND SUBSIDIARIES Schedule 571
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2013 AND 2012
Expressed in thousands of
S Dollars, unless otherwise stated
40. SIGNIFICANT AGREEMENTS, COMMITMENTS AND CONTINGENCIES continued
l. Mining Law No. 42009
On 16 December 2008, the Indonesian Parliament passed a new Law on Mineral and Coal Mining the “Law”, which received the assent of the President on 12 January 2009, becoming Law No. 42009. The CCA system under which
Adaro, one of the Group’s subsidiaries, operates, will no longer be available to investors. However, the Law indicates that existing CCAs, such as that held by Adaro, will be honoured. There are a number of issues which
existing CCA holders, including Adaro, are currently analysing. Among others these include:
- the Law notes that existing CCAs will be honoured until their expiration. However, it also states that existing
CCAs must be amended within one year to conform to the provisions of the Law other than terms relating to State revenue - which is not defined, but presumably includes royalties and taxes; and
- the requirement for CCA holders which have already commenced some form of activity, within one year of
enactment of the Law, to submit a mining activity plan for the entire contract area. If this plan is not fulfilled, the contract area may be reduced to that allowed for mining business licences “Izin Usaha Pertambangan” or
“IUP” under the Law.
In February 2010, the Government of Indonesia released two implementing regulations for Mining Law No. 42009, i.e. Government Regulation No. 222010 and 232010 “GR No. 22” and “GR No. 23”. GR No. 22 deals with the
establishment of the mining areas under the new mining business license “IUP”. GR No. 23 provides clarifications surrounding the procedures to obtain the new IUP. GR No.23 indicates that existing CCAs will be honoured by the
Government although any extension of existing CCAs will be through the issue of an IUP.
On 21 February 2012, the Government of Indonesia amended GR No. 23 by issuing Government Regulation No. 242012 “GR No. 24”, which regulates the transfer of IUPs, divestment and mining areas.
The Group is closely monitoring the progress of the implementing regulations for the Law and will consider the impact on its operations, if any, as these regulations are issued.
m. Ministerial Regulation No. 282009
In September 2009, the Minister of Energy and Mineral Resources issued Ministerial Regulation No. 282009, which, among others, requires the Directorate General’s approval to use an affiliate as a mining services contractor. The
regulation provides a definition of affiliates and provides exceptions only when there are no similar mining services companies in the regencycity andor province, or when there are no other capable mining service companies
operating in the area. The regulation requires mining concession companies under their existing contracts to conduct all coal extraction activities themselves within three years after the issue of the regulation, except for new
contracts where the obligation is effective from the date of the contract.
Accordingly, Adaro will be required to develop its own extraction capabilities in lieu of relying on third party contractors. The regulation provides a three-year transition period for changes to existing arrangements.
The Director General of Mineral, Coal and Geothermal has recently issued Director General Regulation No. 376.K30DJB2010 dated 10 May 2010 regarding the procedures and requirements for requesting approval for
involving a subsidiary andor an affiliate in mining services activities “Dirgen Regulation”. The Dirgen Regulation further regulates Ministerial Regulation No. 282009, specifically regarding the procedures and requirements for
the involvement of a subsidiary andor an affiliate in mining services activities.
On 8 October 2012, Ministerial Regulation No. 282009 is partially amended with Ministerial Regulation No. 242012, which regulates that Adaro may lease equipment from any mining supporting companies holding the Certificate of
Registration issued by the Minister, Governor, or Regent in accordance with the authorities.
Management believes that the Group has complied with Ministerial Regulation No. 282009 that requires Adaro to carry out coal extraction activities itself as well as Ministerial Regulation No. 242012 regarding equipment leases.
Neither regulation inflicts any impact or substantial change upon the structure of Adaros operations.
232
IABlE, STrong, EFFICIEnT
PT ADARO ENERGY Tbk AND SUBSIDIARIES Schedule 572
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2013 AND 2012
Expressed in thousands of
S Dollars, unless otherwise stated
40. SIGNIFICANT AGREEMENTS, COMMITMENTS AND CONTINGENCIES continued
n. Ministerial Regulation No. 342009
