Bahlil Reviews Application of Upstream Oil and Gas Profit-Sharing Scheme to Mineral-Coal Mining

Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia has revealed that the government is studying the implementation of a profit-sharing scheme similar to that in the upstream oil and gas (migas) industry for the mineral and coal (minerba) mining sector as well. He made this statement after meeting with President Prabowo Subianto in a limited meeting at the State Palace on Tuesday (5/4/2026). In that meeting, one of the main focuses of discussion was the restructuring of the national mining sector. “We discussed the future arrangement of mining that must be mostly owned by the state. And that is related to the implementation of Article 33 (of the 1945 Constitution),” Bahlil explained at the State Palace on Tuesday (5/5/2026). According to Bahlil, the government wants to ensure that the management of natural resources, both old and new mines, can provide maximum contribution to state revenues. At least, one of the options being studied is to adopt a cooperation pattern similar to that applied in the upstream migas sector for mining. In the upstream migas world, there are two cooperation contract schemes: Production Sharing Contract (PSC) Cost Recovery and PSC Gross Split. Both types of contracts are forms of cooperation between the government through the Special Task Force for the Implementation of Upstream Oil and Gas Business Activities (SKK Migas) and investors. “And we will use examples like the profit-sharing from our migas management. Our migas has Cost Recovery, has Gross Split; perhaps those patterns that we will try to exercise to build cooperation with the private sector,” Bahlil clarified. Nevertheless, he emphasised that the concession scheme in the management of mineral and coal mining will still be maintained. “Still concessions, but we will optimise for income so that it is balanced with the state, and the state should get a larger portion,” he said.