Govt mulls banning ore exports to secure domestic supply
Leony Aurora, The Jakarta Post, Jakarta
The government is mulling the possibility of banning the exports of ore mined in the country in a bid to secure the supply for domestic demand, an official with the Ministry of Energy and Mineral Resources says.
The ban would not be stipulated explicitly in the law, secretary to the ministry's directorate general of geology and mineral resources Sukhyar said on the sidelines of a workshop on coal and mineral resources on Saturday.
"The law will state that companies holding licenses must process the ore domestically," he said.
The regulation would only be applicable for new licenses, he added. "Of course, we will not obstruct existing companies that have long term contracts."
Discussions on the matter would be conducted with related officials at the Ministry of Trade, which is in charge of regulating exports, said Sukhyar.
The energy ministry has finished drafting the much-awaited law on mineral and coal mining, which is expected to be deliberated at the House of Representatives in the near future.
Article 23 of the bill says that all companies holding licenses for operation and production must process or conduct part of the mineral purification of their mineral and coal outputs domestically.
"There are four metals that must be protected under the law, which are iron, nickel, aluminum and copper," Sukhyar said.
What the government wants, he said, is to have the mineral outputs processed until they were ready to be used by local manufacturers.
Ministry of Trade director for export of agriculture and mining products Muhammad Najib said his ministry had not received a proposal on the export ban.
"Usually we issue such bans based on suggestions from related ministries," he said.
Most of Indonesia's mining outputs are exported overseas, both in the form of ore and processed products.
In the first three months of this year, exports from the commodity group of ore, slag and ash -- which include ore of manganese, iron, copper, cobalt, aluminum, lead, zinc, tin, gold and silver -- almost tripled to US$702 million from $263.3 million in the corresponding period the previous year.
However, there is no data on how much was in the form of ore.
PT Aneka Tambang (Antam), a big player in the country's mining sector, said it was ready if the government decided to implement the ban on ore exports.
"We have no problem with the plan," said Antam's operational director Alwin Syah Loebis, who also attended the workshop.
Antam exports all of its bauxite and part of its ferronickel overseas to have them processed.
The company has two nickel processing plants using marine diesel and industrial diesel, with a third plant to start next year.
Antam plans to construct a fourth nickel plant for a venture with Posco, South Korea's largest steelmaker, to produce 30,000 metric tons of nickel contained in ferronickel per year.