Regulation of Processing and Refining of Mining Products in Indonesia

 

Most of the mineral mining resources in Indonesia are exported in the form of raw materials, without prior domestic processing and refining. This condition results in mineral resources not producing added value or direct multiplier effects to the people.

The management and utilization of mineral resources must be related to the non-renewable nature of these natural resources. This means that one day if it continues to be exploited, it is certain that it will run out. As a non-renewable natural resource and various types of mineral mines sooner or later one day they will become scarce or even impossible to find.

Under these conditions, it is appropriate for the Indonesian Government to require strategic efforts with the obligation to increase the added value of minerals by processing and refining domestically. The policy is regulated in Article 102 of the Minerba Law, which states that “IUP and IUPK holders are required to increase the added value of mineral and/or coal resources in the implementation of mining, processing and refining, as well as the utilization of minerals and coal.”

Furthermore, Article 103 of the Minerba Law states:

1. Holders of Mining Business License (IUP) and Mining Business License (IUPK) for Production Operation are required to process and purify mining products domestically;
2. Holders of IUP and IUPK as referred to in paragraph (1) may process and purify mining products from other IUP and IUPK holders; and
3. Further provisions regarding the increase in added value as referred to in Article 102 as well as processing and refining as referred to in paragraph (2) shall be regulated by a government regulation.

Whereas Article 102 and Article 103 of Law 4/2009 regulate the obligations of IUP and IUPK holders to increase the added value of mineral and coal resources and to process and purify mining products domestically is one way to ensure the availability of raw materials for mineral processing and refining industries. domestically and preserve natural resources. In addition, Article 102 and Article 103 of Law 4/2009 are also useful for increasing the capacity of Indonesian human resources in the mining industry.

Therefore, all business activities related to mineral and coal mining must refer to the applicable legal provisions, so that they can benefit the life of the community, nation and state and support sustainable national development.