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Jakarta Post

Govt promises to ease licensing procedures in mining sector

  • Raras Cahyafitri

    The Jakarta Post

Jakarta   /   Mon, October 27, 2014   /  09:35 am

The Energy and Mineral Resources Ministry'€™s directorate general for mineral and coal plans to simplify the complicated licensing procedures in the country'€™s mining sector in order to boost investment.

The simplification will reduce the number of required permits to only 71 types, from the 101 types that exist at present.

Out of the total 71 permits, 26 are issued by the energy ministry while another 51 are issued by other government agencies.

The director general for mineral and coal, R. Sukhyar, said the simplification would be carried out in the issuance of permits from his ministry because the issuance of the other 51 permits were handled by other government offices.

  • Permits to be reduced to 71 types from 101 types at present
  • Simplification will cut red tape, and attract more investment
  • New policy expected to be implemented next year; pending approval by new energy minister

'€œThe cut in the number of permits is expected to improve efficiency. Of course, by doing so, we hope the mining sector will attract more investment,'€ he said.

Under the simplification plan, mining companies will no longer be required to obtain more than one permit for a single stage of the mining operations.

'€œTo ensure that mining firms are actually performing the activities, they will have to report to us and we will perform an inspection,'€ Sukhyar said.

Under the plan, the mineral and coal office also plans to remove the requirement imposed on miners for the transportation of their production.

Sukhyar said the transportation of minerals and coal will be the full responsibility of mining firms. If they have no expertise in mineral and coal transportation, they can hire companies that offer those services, according to Sukhyar.

The plan to ease the licensing procedures will be submitted to the new energy and mineral resources minister Sudirman Said.

Sukhyar said he expected that a ministerial regulation regarding the proposal would be approved
by the end of this year so that his office can start the implementation of the simplified permission process next year.

Mining companies welcomed the plan. The shorter bureaucratic process will significantly ease the mining business in the country and, in return, boost investment, said Bob Kamandanu of the Indonesian Coal Mining Association (APBI).

However, he said the plan to ease the licensing procedures should not weaken the government'€™s program to promote good mining principles.

'€œWe don'€™t want the simplification to let mining firms ignore those matters,'€ Bob said.

He added that government officials should improve their supervision of the mining sector so that mining firms give true and correct reports of what they have performed.

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