Smelter operators oppose plan to relax mineral export ban policy
Saturday, September 3 2016 - 02:34 AM WIB
AP3I Deputy Chairman Jonatan Handojo was quoted by Bisnis Indonesia as saying that relaxing the export ban policy would be detrimental to 27 smelters which have been in operation since the past few years. He added that the investors have spent US$12 billion to build the smelters between the period of 2012 and 216.
?This (relaxation of the export ban policy) will be the end of the world for the Indonesian smelter industry.
Jonatan was commenting on reports that interim Minister of Energy and Mineral Resources Luhut Panjaitan plans to relax the current mineral ore export ban policy as part of the planned revision of the 2009 Mining Law initiated by the House of Representatives. Luhut said that the revision of the mining law is expected to be completed this year.
The previous government launched in early 2014 a policy to ban the export of mineral ores in a bid to push miners to build domestic smelters to process and refine the ores before export to allow the country to generate greater value from its mineral commodities as mandated by the 2009 Mining Law. The government, however, decided at the time to allow mineral concentrates such as copper concentrates produced by giants PT Freeport Indonesia and PT Newmont Nusa Tenggara to continue export until early 2017, when they?re required to already set up domestic smelter. Both Freeport and Newmont have yet to complete required smelter.
Construction of many other smelters, except nickel, has also been progressing at a snail?s face. Luhut argued that the mining companies need to be able to resume export to raise funds to accelerate and complete the construction of their smelter projects.
Of the 27 domestic smelters which have been in operation, according to AP3I, 20 are nickel smelters, four iron smelters, and one each for aluminum, zircon, and silica.
Meanwhile, Head of the Indonesia Smelter and Processing Association (ISPA), Sukhyar was quoted by Kontan as saying that he also opposed plans to relax the mineral ore export ban policy as it would be detrimental to the development of domestic smelter industry.
He, however, suggested that relaxation can be given to copper concentrates, with a condition that the government must closely monitor the development of the domestic copper smelter to make sure that it can be completed. (*)