Overview of Mining Regime

• Author: William A. Sullivan/Christian Teo Purwono & Partners
• Profession: Licensed Foreign Advocate in Indonesia as well as a Solicitor of the Supreme Court of New South Wales
• Pages: 1-24

CHAPTER 1

Overview of Mining Regime

Chapter 1 provides an overview of Indonesia’s legal and regulatory regime

for mining business activities.

I. Prevailing Laws and Regulations

The more important laws and regulations currently governing Indonesian

minerals and coal mining and their related activities are as follows:

a. Law No. 4 of 2009, dated January 12, 2009, re Minerals and Coal Mining

(“2009 Mining Law”);

b. Minister of Energy and Mineral Resources (“MoEMR”) Regulation No. 18

of 2009, dated August 19, 2009, re Procedures for Amendment of

Investment in relation to Contracts of Work and Coal Contracts of Work

(“MoEMRR 18/2009”);

c. MoEMR Regulation No. 28 of 2009, dated September 30, 2009, re

Minerals and Coal Mining Services Business (“MoEMRR 28/2009”);

d. MoEMR Regulation No. 34 of 2009, dated December 31, 2009, re Pri-

oritization of Coal and Mineral Supply for Domestic Interest (“MoEMR

34/2009”);

e. Government Regulation No. 22 of 2010, dated February 1, 2010, re

Mining Area Determination (“GR 22/2010”);

f. Director General of Minerals and Coal (“DGoMC”) Regulation No. 376

of 2010, dated May 10, 2010, re Affiliated Mining Services Providers

(“DGoMCR 376/2010”);

g. Government Regulation No. 23 of 2010, dated February 1, 2010, re

Minerals and Coal Mining Enterprise Activities (“GR 23/2010”);

h. Government Regulation No. 55 of 2010, dated July 5, 2010, re Direction

and Supervision of the Management and Implementation of Mining

Business (“GR 55/2010”);

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i. MoEMR Regulation No. 17, dated September 23, 2010, re Procedures for

Minerals and Coal Benchmark Price Determination (“MoEMRR 17/

2010”);

j. Government Regulation No. 78 of 2010, dated December 20, 2010, re

Reclamation and Post-Mining Activities (“GR 78/2010”);

k. Presidential Regulation No. 26 of 2010, dated April 23, 2010, re

Extractive Industry Income Transparency (“GR 26/2010”);

l. MoEMR Decree No. 617 of 2011, dated March 3, 2011, re Coal Prices for

PLN Operated Power Plants (“MoEMRD 617/2011”);

m. DGoMC Regulation No. 999 of 2011, dated August 26, 2011, re Proce-

dures for Determining Cost Adjustments to Coal Benchmark Price

(“DGoMCR 999/2011”);

n. Presidential Decree No. 3 of 2012, dated January 10, 2012, re Estab-

lishment of Evaluation Team for Renegotiation of Contracts of Work and

Coal Contracts of Work (“PD 3/2012”);

o. MoEMR Regulation No. 7 of 2012, dated February 6, 2012, re Local

Processing and Refining of Minerals (“MoEMRR 7/2012”);

p. Government Regulation No. 24 of 2012, dated February 21 2012, re

Amendment of GR 23/2010 (“GR 24/2012”);

q. Minister of Trade (“MoT”) Regulation No. 29 of 2012, dated May 7,

2012, re Mining Product Export Requirements (“MoTR 29/2010”);

r. Minister of Finance (“MoF”) Regulation No. 75 of 2012, dated May 16,

2012, re Export Tax on Export Goods (“MoFR 75/2012”);

s. MoEMR Regulation No. 11 of 2012, dated May 16, 2012, re Amendment

of MoEMRR 7/2012 (“MoEMRR 11/2012”);

t. MoEMR Regulation No. 24 of 2012, dated October 8, 2012, re Amend-

ment of MoEMRR 28/2009 (“MoEMRR 24/2012”);

u. MoEMR Decree No. 2934 of 2012, dated October 8, 2012, re Domestic

Coal Supply Quota for 2013 (“MoEMRD 2934/2012”);

v. Presidential Instruction No. 3 of 2013, dated February 13, 2013, re

Acceleration of Domestic Processing and Refining (“PI 3/2013”); and

w. DGoMC Regulation No. 644 of 2013, dated April 23, 2013, re Amend-

ment of DGoMCR 999/2011 (“DGoMCR 644/2013”).

There are also a number of advanced drafts of other regulations available

which, if and when finalized and issued, will significantly impact minerals

and coal mining activities in Indonesia. These draft regulations relate, among

other topics, to (i) coal upgrading (ii) the procedures for issuing new mining

licenses, (iii) procurement of goods and services, and (iv) community

development and empowerment.

Each of the above referenced laws and regulations (including some of

the draft regulations but excluding MoEMRD 617/2011, DGoMCR 999/2011,

MoEMRR 11/2012, DGoMCD 644/2013 and DGoMCR 614/2013) is the subject

2Mining Law & Regulatory Practice in Indonesia