Indonesian Domestic Market Obligation To Reach 60 Percent

Jakarta-TAMBANG. Indonesia's coal production in the next five years would be based on the the Mid-Term National Development Planning (RPJMN in its Indonesian Abbreviation) 201 5-2019. By the year 2019 coal production will be cut back to 400 MT, of which 60% will be allocated for domestic needs.

“In 2019, 60% of coal production is allocated for Domestic Market Obligation (DMO). The production for 2019 is set at 400 MT," said Sukhyar, Director General of Mineral and Coal - Ministry of Energy and Mineral Resources, on Wednesday (25/02).

Sukhyar told that the RPJMN is set to boost domestic use of coal. Thus, coal export allocation is reduced. As a comparison, this year the DMO is only 92 MT from a production target of 425 MT.

The Directorate claimed that the government will discuss the plan with coal stakeholders.

Sukhyar also told that the domestic market obligation will be used by the state electricity company (PT PLN) and the local industries. PLN will take the majority of coal production of about 85% or 78,2 MT from the 92 MT allocated for domestic this year. The rest is sold to cement and fertilizer industries.

The government therefore stressed the importance of support from all stakeholders. "There is no problem with the production. The issue right now is how to promote domestic use of coal," Sukhyar said.