Potential loss of revenue from Freeport has reached 6 trillion rupiah – West Papua No.1 News Portal
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Potential loss of revenue from Freeport has reached 6 trillion rupiah

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PT Freeport Indonesia mining area in Mimika Regency, Papua – Jubi / IST

Jakarta, Jubi – The Supreme Audit Agency (BPK) found that the potential loss of non-tax state revenues (PNBP) of PT Freeport Indonesia (PTFI) Contract of Work for the period 2009-2015 amounted to 445.96 million US dollars or Rp6.02 trillion exchange rateith, w assumption Rp13.500 per US dollar).

Supreme Auditor IV BPK Saiful Anwar Nasution said the Government through Government Regulation Number 45 Year 2003 as already amended by Government Regulation Number 9 Year 2012, has determined the amount of fixed contribution rate, royalty and additional royalty, but PTFI still uses the tariff stated in Contract of Work (CoW) which amount lower, and not adjusted to the latest tariffs according to the government regulations, thus resulting in the loss of potential PNBP.

Based on Government Regulation No. 9 of 2012, copper royalty rates are set at 4 percent, gold 3.75 percent, silver 3.25 percent. While in the work contract, the copper royalty tariff is 3.75 percent, gold 1 percent, and silver 1 percent.

“According to the BPK, the royalty must be in accordance with the PP, but it has been fixed, while the fix it too late,” said Saiful during a discussion at the BPK Office, Jakarta, Tuesday (October 3). The main problems, one of which is internal control in the Freeport Indonesia Contract of Work includes the implementation of policies that result in the loss of potential revenue.

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Nevertheless, Saiful confirms that BPK’s findings only show potential state losses, not state real losses.

“The potential is not really a material loss, if we do not do something, it could be a loss, so we recommend not to deposit it first, we recommend it to do something first, otherwise it is called a state loss” Saiful said.

Inspection of PT Freeport Indonesia (PTFI) Working Contracts (PTFI) for 2013-2015 is conducted at the Ministry of ESDM, Ministry of Environment and Forestry (LHK) and other relevant agencies. The examination of PTFI COW 2013-2015 aims to assess PTFI’s compliance with its tax obligations, non-tax revenues (royalties and fixed fees) as well as export duties, assess compliance with environmental regulations and examine whether PTFI’s extension of contract and divestment PTFI’s shares have been in compliance with the laws and regulations.

The examination results of PTFI CoW concluded that the management of mineral mining at PTFI has not been fully implemented in accordance with the provisions in place to ensure the achievement of the principle of sustainable and environmentally sound natural resource utilization for the greatest prosperity of the Indonesian people.

The conclusions are based on the weaknesses occurring in the PTFI CoW from the aspects of state revenue, the environment, the extension of work contract and divestment of shares, whether related to internal control or compliance with the provisions of the law.

Based on the BPK data, the examination results of PTFI KK in 2013-2015 revealed 14 findings containing 21 problems. These issues include 11 weaknesses of the Internal Control System (SPI) and 10 non-compliance with statutory regulations valued at 181.45 thousand US dollars, or equivalent to Rp2.41 billion.

Earlier, in 1967, the Government of Indonesia signed a first generation agreement with one of the companies from the United States. The COW Agreement was renewed to the V-generation KK in 1991. PT Freeport Indonesia’s working areas include Blocks A and B which are spread over seven districts in Papua Province.

In the period 1967-2015, PTFI experienced several changes in the composition of shareholder ownership. As of December 31, 2015, 81.28 percent of PTFI’s shares are owned by Freeport McMoRan (FCX), while the Government of Indonesia and Indocopper each have 9.36 percent. But to note, Indocopper shares are wholly owned by FCX.

The issuance of Law Number 4 Year 2009 on Mineral and Coal Mining becomes the strong legal basis for the government in encouraging companies to develop and increase the added value and benefits of mining business activities optimally. In accordance with the mandate of Article 169 paragraph (2) of Law Number 4 of 2009, the provisions in Article PTFI CoW shall be adjusted (renegotiation) with the Government of Indonesia no later than 1 (one) year since its enactment.

Since 2010 KK renegotiations have been implemented by several government-formed teams. In 2015 the results of the renegotiation emphasize on six strategic issues, namely the area of ​​work, the continuation of mining operations, the state revenue of processing and refining obligations, divestment obligations and liability of the use of goods, services, and domestic labor.(Antara/Zely Ariane)

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Economy

CSOs decline logging company in Wondama

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Administrative map of Teluk Wondama Regency. – Jubi/manokwari.bpk.go.id

Jayapura, Jubi – Some Papua’s CSOs namely LP3BH Manokwari, YALI Papua, Yayasan Pusaka and Pemuda Suku Mairasi urge the Minister of Environment and Foresty to review the operation permit of a logging company PT Kurniatama Sejahtera (KTS) in Mairasi area.

The Mairasi tribal communities from Undurara, Wosimo and Inyora villages sent a statement letter stated on 12 May 2019 to oppose PT KTS to operate in Mairasi.

“People feel uneasy and disturbed due to the presence of the company and the military. It creates unsecured, disharmony and has no guarantee of providing economic benefit to the community,” Agust Veth from Pemuda Suku Mairasi told Jubi by phone on Sunday, 9 June 2019 in Jayapura.

According to Veth, people have not forgotten the incident of Bloody Wasior (2001) that allegedly triggered by logging activity from the timber company Darma Mukti Persana. Further, he said the human rights violation case in Wasior has not settled since then.

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“Now, the military along with some public leaders represent the LMA (Customary Council) who facilitate the meeting on ‘Social Communication’ allegedly want to intimidate and force the local community to approve the logging company to operate in Mairasi. However, the local community continue to decline the company and refuse to attend the meeting.”

Mairasi people have objected the timber activity of KTS since 2012, while in 2013, a military culprit based in KTS logging area in Sorong allegedly tortured three residents from Sararti and Ambuni villages. The incident then reported to the local government, the People’s Assembly of Papua Barat and the Minister of Forestry. No action towards both perpetrator and the company has yet taken.

“Some reports revealed that PT KTS had some internal and financial issues. The company cannot pay the IUPHHK-HA (licence for utilization of timber in natural forest) and has a deficit (source: www.nasional.kontan.co.id, 2010; PT. Inti Multima Sertifikasi, 2015),” added Vest.

The logging company PT Kurniatama Sejahtera obtained the IUPHHK-HA from the Minister of Forestry (now the Minister of Environment and Forestry) Nomor SK.648/Menhut-II/2009 on 15 October 2009 to permit it to operate in a concession area of 115.800 hectares located in Teluk Wondama Regency. PT KSP is a subsidiary company of Artha Graha Group operating in Teluk Wondama Regency.

Concerning the permit, the civil society organisations ask the Minister of Environment and Forestry to evaluate the permit of PT KSP and give penalties for their negligence.

“We also ask the Military Commander of XVIII Kasuari to urge the Military District Command Sector Wasior and other local military authorities to stop using the military approach and intimidation towards the local community and backing up the interest of PT KTS.”

“They should prioritise respect, protection and fulfilment on human rights and environment, especially the basic rights of Mairasi Tribe. Most importantly, they must prevent the reoccurrence of the same conflict. Therefore, the law enforcement and legal protection of Mairasi Tribe are in need.”

However, the Ministry of Environment and Forestry, Military Command of Kasuari and PT KTS have not confirmed this information. On the other hand, Konstan Natama, the Acting Sub-district Chief of Naikere, Teluk Wondama Regency told Antara on 18 January 2018 that he was concerned about the massive logging activity by PT KTS clearing out the ironwood trees in Naikere.

Meanwhile, Franky Sanperante from Yayasan Pusaka said another subsidiary company of Artha Graha Network is PT Papua Satya Kencana with IUPHHK-HA license No SK.647/Menhut-II/2009. It has a concession area of 195.420 hectares located in Teluk Bintuni Regency.

“Combined, the total concession of the two companies is about 79% of the total area of Teluk Wondama Regency (3,960 Km2) or fivefold of the area of Jakarta,” said Frangky.

In the report published by Research and Development Centre of Department of Health of the Republic Indonesia “Merindukan Hidup Sehat Orama Etnik Mairasi Kabupaten Teluk Bintuni, 2014”, it mentioned that trees with a diameter of one meter such as ironwood and mahogany found in that area.

In Naikere, PT KTS has cleared out the trees since 1990 and stopped the operation at the time of Wasior incident (2001). Timber trucks carried one or two logs of wood with a diameter of one or two meters three or four times a day at that time. (*)

Reporter: Timoteus Marten
Editor: Pipit Maizier

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Economy

Jayapura District Court seized PT. PRP assets

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PT. Percetakan Rakyat Papua looks not well maintained. – Jubi / Alex

Jayapura, Jubi – Jayapura District Court 1A orders the confiscation of assets belonging to PT Percetakan Rakyat Papua (PRP-Papua Printing Company) to pay severance of its former employees that amounted Rp 1 billion. This order is made based on Decree No. 10/Pdr.Sus/PHI/2017/PNJAP on the industrial relations issued on 21 February 2018.

A bailiff from Jayapura District Court Frederik Padalingan said the court had won the plaintiff who demanded their unpaid compensation after being unilaterally fired by the company. “So today we execute the confiscation of the company’s assets,” said Padalingan on Tuesday (21/5/2019) in Jayapura.

In the verdict, the defendant (PT. PRP) was ordered to pay compensation to each plaintiff including severance, service payment, 19 months unpaid salary, deviation of salary payment deficiency, transportation and meal allowance which reach more than Rp 1 billion in total. Defendant also charged Rp 421 thousand with all costs incurred in this case.

Therefore, based on a letter issued 2 April 2019, the court has conveyed the assets of the company consisting of a unit of Heidelberg 102-2P printing press, a unit of SM 102-P Heidelberg printing press, and a unit 52-4 4P Heidelberg printing machine to be seized.

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“Because the verdict order the defendant to pay a sum of money and in reality the defendant cannot afford it, so the court seize their assets for the auction. However, if the defendant still does not pay its obligation, there will be going to the execution stage. “We cannot confirm when this process will be held, because we have to pass the early process,” he said.

Moreover, Padalingan added that ten former employers who demanded their rights are Nelce Mayasari Wanma, Elisa D. Regoy, Putri Anitasentri, Ahmad Ariyanto, Haris Adrdiansyah, Sugianto, Luis Loiker Worembai, Samson Pahabol, Yohana Diana Dimara, and Abdul Regards.

Separately, the Acting Director of PT. PRP Yustinus Saraun that this state-owned printing company in Papua is currently experiencing bankruptcy as the excess of mismanaged by old management that caused all employees asked for their unpaid compensation.

To respond to this situation, PT. Irian Bhakti Mandiri (IBM) as the leading company assisted PT. PRP to pay the salaries of its employees from April to September 2016. However, due to no printing order, the company cannot run well, but they cannot fire the employees immediately because it should be executed through an official decree.

“I am now only an acting director, so I do not have an authority to dismiss the workers. So everything works as it is today,” said Saraun.

However, both Saraun and PT. IBM will sit together to discuss a solution concerning the late payment of employees’ salaries as ordered by the District Court.

“We are working on this. Hopefully, we can solve this problem with the governor. We have even submitted a letter to the governor,” he said.

“The point is we want to save the assets because they belong to the regional government, not the company,” he said. Moreover, he said it is not only ten employees that have not received their salaries, but there are still around 20 who had similar experiences.

“This is what we are trying to accomplish — hopefully, PT. PRP can be active like it was in the past and cooperate with PT. Peruri,” he said. (*)

 

Reporter: Alexander Loen

Editor: Pipit Maizier

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Economy

Indonesia loses Pacific asset in Franzalbert Joku

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Indonesian government consultant on West Papua-related issues, Franz Albert Joku. Photo: RNZ / Johnny Blades

Papua, Jubi – Indonesia has lost a significant asset from in its Pacific diplomacy efforts with the recent passing of the West Papuan, Franzalbert Joku.

The prominent Sentani landowner was the international spokesman for the Papua Presidium Council which galvanised momentum in the independence struggle at the turn of the century.

But in his last decade, Mr Joku strongly advocated autonomy for Papua within Indonesia rather than independence. He often represented Indonesia at regional meetings of the Melanesian Spearhead Group and the Pacific Islands Forum.

Mr Joku, who died at the age of 66 late last month in Jayapura, had fled from Indonesian rule in his homeland as a youth with his family in the early 1970s. For around three decades he lived in various parts of Papua New Guinea where Mr Joku worked as a journalist and a PNG government advisor who developed extensive links in the Pacific.

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An expert in Indonesian history and politics, Richard Chauvel of the University of Melbourne, says Mr Joku’s career in PNG was significant.

“His great utility both in the early 2000s (for the Papua Presidium) and post 2007/8 for the Indonesian government has been his intimate knowledge of Papua New Guinea politics, through his role as a journalist and then as a political advisor or spokesman for (former PNG PM) Julius Chan and other senior PNG politicians,” Dr Chauvel said.

“I think it’s that knowledge of local PNG politics, and through networks into the Pacific, that made him such a formidable figure, both initially for the Presidium, in the lobbying of the Melanesian Spearhead Group and the Pacific Islands Forum, and then subsequently for doing much the same thing, utilising the same skills and knowledge for the Indonesian government,” he explained.

As an effective envoy for Jakarta, Mr Joku had a forthright approach to his diplomacy, as evidenced last year by his instrumental role in pressing the Solomon Islands government to mollify its support for West Papuan self-determination aspirations:

Occupying both extremes of the Papuan political spectrum over time made Franzalbert Joku a polarising figure in the eyes of West Papuans.

“The way he executed those positions was remarkably the same – with great commitment, very articulate, he was obviously a bright guy… you could never accuse him of being nuanced,” Dr Chauvel said.

Dr Chauvel first met Franzalbert Joku when he was lobbying for the Presidium, the organisation which energised the independence struggle as democatic space opened up briefly in post-Suharto Indonesia around the time of the Papua People’s Congress in 2000 in Jayapura.

“He was just as vigorous and forthright in his advocacy of that position as he later became from 2007/8 onwards when he’d clearly joined the other side,” he said.

Indonesia’s Foreign Affairs Ministry has a number of officials who have led delegations to MSG and Pacific Forum meetings over the past decade.

“They have acquired some of that background knowledge, but I don’t think that they can speak to their counterparts in Vanuatu, Fiji, Solomon Islands and PNG from the same position as Franzalbert could, as a Pacific Islander,” Dr Chauvel said. (*)

 

Source: RNZI

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