Govt mulls special privilege for SOEs to develop rare earth minerals

By Thomas Sembiring

The government is considering of providing special privilege to state-owned enterprises (SOEs) to develop the country?s rare earth minerals as part of efforts to strengthen state firms.

The plan is included in the revision of the 2009 Mining Law proposed by the government as seen during a recent focus group discussion held by the Directorate General of Mineral and Coal.

The government has also proposed it be given the authority in the issuance of the IUP mining business permit for rare earth minerals, instead of provincial administration.

The government will also assign SOES to conduct study and research of rare earth mineral potentials in the country.

So far, only state-controlled tin giant PT Timah Tbk which has been engaged in the rare earth minerals sector. As has been reported, Timah plans to start construction of a commercial-scale rare earth mineral processing plant mid this year after securing partners for the project.

Timah Corporate Secretary Agung Nugroho said the National Nuclear Power Agency (Batan) and state-owned enterprises (SOEs) have agreed to help the company in developing the project, to be located in Muntok, West Bangka Regency, Bangka Belitung Province. He declined to disclose the name of the SOEs.

Timah last year completed the construction of a mini rare earth plant as pilot project, also located in Muntok, with a tiny capacity of 1,500 kg per year, and total investment of US$40 million.

Agung said that the industry-scale plant will ideally have a capacity of 500 tons per year.

He added that plant is expected to start production in 2018. The plant will process monazite, a by-product of tin production, into high value rare earth metals used as raw material in high-tech consumer goods such as hybrid cars, smart phones, and TVs.

Editing by Reiner Simanjuntak