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decade-long study by Indonesia Corruption Watch (ICW) has found nearly Rp 365 trillion (US$27 billion) worth of unreported coal transactions between 2006 and 2016, which could have caused state losses.

About Rp 113 trillion of that sum is related to royalties and taxes.

“We found many loopholes in export declarations or letters of credit, which led us to mismatches in [export] volumes and transfer pricing,” ICW researcher Firdaus Ilyas said during a discussion titled “Strategy of National Coal Management” in Jakarta on Thursday.

The ICW data differs from that of the Finance Ministry.

As of September, non-tax revenue from mineral and coal mining stood at Rp 36 trillion, thereby already exceeding the income achieved in the years of 2009 to 2016, according to data from the Finance Ministry.

Firdaus emphasized that the lack of accurate data and acts of corruption had hurt the government’s income from the coal mining business, such as tax revenue, royalties and non-tax revenue.

He said that, given the lack of reliable data and corruption, the positive development in non-tax revenue from mining, which as of September had reached 101 percent of the target, was still far from perfect.

“There are plenty of holes [possibilities for corruption], thus our direct benefit from coal [mining] is far from the maximum. And it reflects in the different data [on coal mining] presented by [different] state agencies,” he added, without naming any specific cases of corruption.

On the sidelines of the event, the National Development Planning Board’s (Bappenas) director for energy, Josaphat Rizal Primana, said one way to tighten oversight of transactions in the coal sector was by involving the Corruption Eradication Commission (KPK).

Firdaus, however, said that could only be done if the relevant ministries and agencies, namely the Energy and Mineral Resources Ministry and the Customs and Excise Office, also had the political will to increase transparency on coal business transactions.

“Unreported transactions in the coal industry are seen as administrative issues. Hence, the KPK will leave the problem to the relevant state institutions. The graft agency will only take action if a case is related to bribery,” he said.

Closing loopholes is of vital importance against the backdrop of declining coal resources and negative public perceptions of coal as a dirty fuel, both of which will affect the commodity’s price.

United Kingdom-based international financial institution Standard Chartered is one of numerous global firms that have decided to stop financing new coal-fired power plants in a bid to address climate change.

According to 2016 data from the Energy and Mineral Resources Ministry, Indonesian coal reserves stood at 28 billion tons, which would run out in 2086 assuming a constant production rate of 400 million tons per year.

The Indonesian Coal Mining Association (APBI) has predicted that coal prices could be on a declining trend until year-end, as China, one of the main consumers of coal, has reduced its consumption.

As of Wednesday, according to Bloomberg, the coal price under November 2018 shipping contract on ICE Futures Newcastle was $115.05 per metric ton, up 0.13 percent from the previous day.

Meanwhile the country’s coal reference price (HBA) for October was set at $100.89, down 3.74 percent from September.