Indonesia plans to adjust its royalty payment policies on sales of gold and coal in an effort to boost state revenues as prices of the two commodities recover, an official said last Friday.

The world's top exporter of thermal coal expects a recovery in prices and exports this year after scoring a $1.5-billion trade deal with China.

"In an effort to increase state revenue, we are in the process of adjusting the gold and coal royalty rates," disclosed Ridwan Djamaluddin, the director general of minerals and coal at the ministry.

Indonesia now plans to revise coal royalty payments to a system based on both calories and market price, as opposed to just calories now, Ridwan added.

Companies currently pay 2% to 7% of coal sales to the central government in royalties, while gold royalty payments are now set at 3.75% to 5% of gold sales, based on prices of up to $1,700 per ounce. Since prices have exceeded that, it is time to revise the royalty rates, Ridwan said.