Vale says no to relaxing mineral ores export ban

By Tri Subhki R.

IDX-listed nickel producer PT Vale Indonesia Tbk expects the government to be consistent in implementing the mineral export ban policy, which has been successful in pushing for the development domestic nickel smelter industry.

The company opposed suggestions for the government to relax the current export ban on mineral ores.

"For nickel, we expect the government stays consistent to the domestic processing and refining without any relaxation," Vale's President Director Nico Kanter said to Petromindo.com on Friday.

He was commenting to reports that the government is considering to relax the mineral ores export ban policy, introduced by the previous administration in early 2014 as mandated by the 2009 Mining Law, in a bid to generate greater value from the country?s minerals by pushing miners to build domestic smelters to refine the ores prior to export. The government, however, has allowed certain mineral concentrates producers to continue export, requiring them to complete construction of domestic smelters by 2017 when export will be entirely banned.

The plan has been included in the academic draft of a new mining law, a revision of the 2009 Mining Law, which is scheduled for deliberation at the House of Representatives soon. Minister of Energy and Mineral Resources Sudirman Said has stated that the revision is expected to be completed this year.

Sudirman earlier said that the current commodity downturn has affected miners? financial condition, and hampers development of domestic smelters. As such, not all planned smelters can be completed by 2017 as initially targeted.

The minister has also said that any relaxation in the export ban policy will not only affect mineral concentrates, but also certain mineral ore products.

Nico suggests that the current policy has been succesfully in developing domestic nickel smelter industry. Indeed, only nickel smelter projects which have shown significant progress, while smelters of other commodities have been moving at snail?s pace due to various reasons.

Relaxing mineral ore export ban, according to Nico, will also trigger further commodity price downturn amid lingering oversupply situation.

Editing by Reiner Simanjuntak