From Government of Indonesia

Parliament Finalizes Mining License Changes

Proposed changes to the system of mining licenses are in the final discussion process in parliament, an Indonesian government official said Tuesday (8/5/07).

The proposed changes are expected to address tension among national and local authorities for control over gold, coal, nickel and copper resources, Dow Jones Newswires reported.
Infighting and lack of clarity over regional autonomy have been blamed for the lack of new mine developments in recent years.

"Regional autonomy presently is one of the issues and challenges mining industries," Simon Sembiring, Director General at the Ministry of Energy and Mineral Resources, said at the Asia Mining Conference.

Aside from clarifying central government, provincial and district authority, the proposed license changes will establish mining zones and state reserves of special national interest, Sembiring said.

The mining licensing system will do away with direct contracts between the mining companies and the government, and will instead use a system where mining licenses are granted by the government of the province in which the mine is located. The proposed licensing system is also expected to foster development of downstream activities.

Processing and refining of metal must be established in Indonesia, Simbiring said.
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