Indonesia amends mining law to boost access, support processing

INDONESIA’S parliament on Tuesday (Feb 18) passed a bill to revise the country’s mining law, aimed at boosting development of domestic mineral processing industries and regulating mining access for small businesses and religious groups.

The amendment seeks to encourage participations of smaller-scale firms in mining sectors and to ensure ore supply security for mineral processing industries, as resource-rich Indonesia seeks to further develop its domestic metals sector.

Indonesia is a major coal exporter and has rich deposits of tin, copper and bauxite, among other metals. It is the world’s largest source of nickel.

The amended mining law enables priority access for mining concessions for companies that aim to build processing facilities, taking into account the size of their investment, the value addition and job creation.

Religious groups, through a business unit under their control, and small- to medium-sized businesses will also be allowed priority access to certain mining areas.

In the past, such priority access has only been given to state-owned companies.

Universities were previously included in the parties allowed for priority access, but were later removed.

Instead, priority will be given to certain government-controlled or private businesses to manage a mining area for the benefit of the universities, such as for research and scholarship funds.

“This amendment is in line with the government’s aspiration to reform governance of mineral and coal mining,” Energy and Mineral Resources Minister Bahlil Lahadalia told parliament after a plenary vote that passed the bill.

The law revision was also to satisfy a 2021 constitutional court order to revise a number of articles related to mining that the court said were unconstitutional. REUTERS