The government’s recent decision to allow the exports of copper concentrate, nickel ore and washed bauxite is a pragmatic move, says Energy and Mineral Resources Minister Ignasius Jonan.
“The government does not see this as a ‘relaxation’ but as a decision that is realistic [to the circumstances]. The Mining Law stipulates that smelters must be completed by 2014. But what can you do?” the minister said during the opening of the Indonesia Energy Roadmap seminar in Central Jakarta on Wednesday.
“If we confiscate everything, do you think that the state can build all the smelters in one night?” he added.
On Jan. 11, the government issued a fourth revision of Government Regulation No. 23/2010 on the management of mineral and coal businesses.
The newest revision, Government Regulation No. 1/2017, allows mining companies to continue exporting copper concentrates and certain amounts of low-grade nickel ore and washed bauxite as long as they have converted their contract of work to a special mining license (IUPK). Furthermore, companies holding an IUPK must also officially express their commitment to building smelters in the country within five years.
Jonan defended the government’s decision and said miners who had been allowed to export minerals would be evaluated every six months in order to check whether smelter construction was running as it should.
If the smelter development was not to the government’s satisfaction, than the export permit would be revoked, Jonan said.
“We are just giving them time, but whether they like it or not, there will be no more exports after 2022. We give them five years, after that, no more. You have to build smelters,” he said.