8.03 Million Tons Of Coal DMO Realized As Of July 2022, Minister Of Energy And Mineral Resources Reveals 71 Companies That Have Not Fulfilled Their Obligations

JAKARTA - The Minister of Energy and Mineral Resources (ESDM) revealed that there are 52 companies that have fulfilled their domestic market obligation (DMO) of 25 percent of the total production for the electricity sector, until July 2022. However, there are still 71 coal companies that have not fulfilled their obligations. the.

The Ministry of Energy and Mineral Resources has issued 123 letters of assignment to coal producing companies to fulfill DMO obligations and are required to supply 18.89 million tons of coal to PLN.

"There have been 123 assignment letters issued to mining business entities with a total assignment volume of 18.89 million tons, with realization up to July 8.03 million tons from 52 companies," he said in a Working Meeting with Commission VII DPR on Tuesday, August 9.

Arifin also detailed several reasons why the company did not or had not fulfilled its obligations, among others, there were five companies that were constrained by extreme weather, 12 companies that supplied coal not according to their needs, two companies whose mines had not yet started operating due to land problems, and four companies had difficulty getting a mode of transportation. coal and there are 48 companies that have not reported.

"The Ministry of Energy and Mineral Resources continues to monitor the commitment of business entities that have not carried out assignments by imposing sanctions on business entities that do not carry out assignments without clear information. Then the export feature on the Minerba Online Monitoring System (MOMS) application will be blocked," Arifin continued.

Arifin continued, currently many companies prefer to pay fines instead of supplying coal to PLN because of the high price disparity between the DMO price and the market price. It doesn't stop there, manufacturers also prefer to avoid contracting with domestic industries.

"The DMO obligation of 25 percent to all coal companies is considered unfair because the quality of the coal owned is not in accordance with the needs of the domestic industry. So a new policy is needed to ensure the availability of domestic coal supply through the collection and distribution of compensation funds, namely forming BLU DMO coal," said Arifin.

For information, the price of coal in the export market is higher than the domestic price, which for PLN, for example, is only US$70 per ton.