Friday, April 19, 2024

Ministry clarifies mining business permit revocation/reinstatement

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Gusty da Costa




The Ministry of Energy and Mineral Resources (ESDM) has clarified the mechanism in the revocation and reinstatement of mining business permits.

Acting Director General of Mineral and Coal at the Ministry of Energy and Mineral Resources Bambang Suswantono said the data originating from ESDM ministry has been used as the foundation for the Ministry of Investment /Investment Coordinating Board to revoke or re-activate mining business permits.

“I want to add here that there are two criteria for revoking mining business permit. First, if the companies did not submit budget plan and work (RKAB), meaning that they had not been doing any activities. Second, if the companies went bankrupt,” Bambang told a hearing at the House of Representatives on Tuesday, March 19, 2024. 

The revocation period began from January 2022 to November 2022. It was reported at the time that there was data on 5,490 mining business permits registered. From the number, there were no activities at 2,343 concession permit holders. On January 6, 2022 there was a follow-up letter from the ESDM Ministry stating that there were 2,078 permits which will be revoked, 122 have been given warnings, 60 are being facilitated and 64 will be further evaluated.

Furthermore, business actors filed objections between January and November 2022. At the time there were 1,132 objections, then 585 of revocations have been  cancelled and 547 were not cancelled. Meanwhile, 919 companies did not object to their permits’ recocation. 

The Mining Advocacy Network (Jatam) has accused Minister of Investment/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia of fraudulent practices by setting tariffs or fees for mining companies seeking reinstatement of their rescinded licenses. 

The polemics over the mining licensing began in May 2021, when President Joko “Jokowi” Widodo issued Presidential Decree No. 11/2021 on the Investment Acceleration Task Force. 

“Through this Presidential Decree, Jokowi appointed Bahlil as Head of the Task Force with the main task of ensuring investment realization and resolving licensing issues. The decree also allows Bahlil to track unproductive mining and plantation permits,” Melky Nahar, Coordinator of JATAM, said in a discussion on Monday, March 18, 2024.  

In January 2022, Jokowi issued Presidential Decree No. 1/2022 on Land Management and Investment Structuring Task Force. This decree mandated Bahlil to chair the Task Force, who tasks include revoking mining permits, business use rights, and forest area concessions as well as providing facilities for community organizations, cooperatives, and others to obtain land.

In October 2023, President Jokowi issued Presidential Regulation No. 70/2023 on Land Allocation for Investment Arrangement, which authorizes the Task Force led by Bahlil to also revoke mining permits, plantations, and forest concessions, as well as grant land utilization permits for mass organizations, cooperatives and others.

Along the way, the Task Force has revoked 1,118 Mining Business Licences (IUP) and 15 Forest Area Utilization Permits (IPPKH). These permits are part of the 2,078 IUPs, 192 Forestry Sector Permits (ISKs), and 34,448 hectares of abandoned plantation cultivation permits (HGUs) that President Jokowi announced in January 2022.

Gusty da Costa






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