Concession areas inside preserved forests get substitutes

Mining investors whose mining concessions located in the newly-declared preserved forests would likely get substitutes for their lost concessions, according to the director general of geology and mineral resources at the Ministry of Energy and Mineral Resources, Wimpy S. Tjejep.

Wimpy said that Rio Tinto's unit PT Citra Palu Mineral in Central Sulawesi, one of those mining companies losing their concession areas because of the implementation of Law No. 41/1999 on Forestry, had got a substitute from the Ministry of Forestry.

"I think that policy is very good because there is a compensation for lost areas for mining investors... There is optimism that from time to time, the number of mining companies that would get substitutes for their lost concessions will increase," he said in Jakarta on Monday (April 2).

Law No. 41/1999, that have come into force since Sept. 30, 1999, bans mining activities in preserved forests using open-pit mining technology. But the law still allows underground mining (closed pit) activities inside preserved forests.

The implementation of Law No. 41/1999 has affected 252 mining companies, whose mining concessions are located in the newly-declared preserved forests.

But according to the director of mineral resources and coal exploitation, Mahyudin Lubis, the number of mining investors whose concessions were declared as preserved forests was no more than 150 companies.

He predicted the number would continuously decline following the policy from the Ministry of Forestry to give compensation areas for their lost mining concessions due to the new law.

The success in providing compensation areas to those mining companies would also depend on the role of officials in local administrations, especially the governors. (*)