Indonesian Coal Mining Association (APBI) claimed that the Ministry of Energy and Mineral Resources will likely agree to revoke the coal price at which miners sell their coal under the DMO mechanism, said Hendra Sinadia, executive director of the association confirming a report carried by Kontan newspaper.
The news focus on coal prices sold domestically by coal miners to various users in the domestic market including state electricity company PT Perusahaan Listrik Negara (PLN).
Acting President Director of PLN Sri Peni Inten Cahyani said in August that her company had filed a proposal to the Energy and Mineral Resources Ministry to keep the DMO price capped at USD 70/MT.
The Indonesian government applied the domestic market obligation (DMO), introduced last year, to ensure that domestic requirements for the nation’s electricity supply are met before the country’s coal cargoes are diverted to the seaborne export market because of higher price realization.
DMO policy mandates local coal mining companies to allocate at least 25% of their annual production for domestic buyers — with much of this coal delivered to coal-fired power plants, mainly operated by PLN.
The Ministry of Energy and Mineral Resources (ESDM) has set a coal domestic market obligation (DMO) volume quota target of 155 MnT in CY20. This amount has increased compared to the DMO plan for this year marked at 128 MnT.
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