Royalty tariff of nickel ores to be increased

By Thomas Sembiring

The royalty tariff of nickel ores will be increased as part of a plan by the Ministry of Energy and Mineral Resources to increase the royalty tariff of mineral ores supplied to certain domestic smelters.

Director General of Mineral and Coal Bambang Gatot Ariyono said that the ministry has submitted to the Ministry of Finance for approval the planned increase in the royalty tariff of minerals.

He said over the weekend that the tariff of nickel ores will be increased. (The tariff of) nickel ores will change, I don?t remember the others,? he said.

As has been previously reported the Ministry of Energy and Mineral Resources (MEMR) plans to increase the royalty of mineral ores supplied to domestic smelters which are not integrated with the mines.

This type of smelters hold so-called industry business permit (or IUI) issued by the Ministry of Industry. Meanwhile, smelters integrated with the mines hold the IUP mining business permit issued by the MEMR.

The royalty of mineral ores supplied to IUI smelters has been based on the market value of the ores, while royalty of ores for IUP smelters is based on the market value of the final refined output. Considering that refined output has higher market value, the royalty from the latter is greater. As such, the MEMR decided to adjust upward the royalty tariff of mineral ores supplied to the IUI smelters.

Editing by Reiner Simanjuntak