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Gov’t Issues New Bill on Mineral, Coal Mining Businesses

TEMPO.COJakarta - The government has issued Government Regulation No. 1/2017 as the fourth revision on the Government Regulation No. 23/2010 on mineral and coal mining business.

Energy and Mineral Resources Ministry Ignasius Jonan said that one of the revisions in the new bill is related to the extension of mining business license (IUP) and special mining business license.

“[The extension] can be applied at least five years ahead of the expiration of the licenses,” Jonan said at his office in Jakarta on Thursday, January 12, 2017.

Earlier, the extension of the licenses can be applied two years before the expiration.

Jonan added that another revision is related to gradual divestment of shares of up to 51 percent. The government has set a 10-year period for miners to realize their share divestments since the production stage. Jonan said that the provision was a direct instruction given by President Joko “Jokowi” Widodo.

“The President wants the government to own the majority of shares,” Jonan added.

The shares will be offered to the government or to state-owned enterprises or national private companies if the government refuses the offer.

The new bill also sets the benchmark prices of mineral and coal. Jonan revealed that the details of the bill will be explained in a Ministerial Regulation.

Jonan added that the government regulation also contains an amendment to provisions on concentrate exports. Jonan explained that holders of contracts of work would not necessarily be able to sell refined minerals. Jonan said that the procedures to increase the added value and mineral sales will be governed in a ministerial regulation.

Jonan hopes that the new bill will boost the state revenue, open new job opportunities and maintain the economic growth.

“We hope that the new bill can maintain a favorable investment climate,” Jonan said.

VINDRY FLORENTIN