West Sumatra stops issuance of new mining permits

The West Sumatra provincial administration has imposed a moratorium on the issuance of new mining permits to give the local government time to reorganize and reconcile existing mining operations, Padangekspres.co.id reported on Tuesday.

Marzuki Mehdi, the head of the mining office of the West Sumatra provincial administration, said on Monday that the moratorium was issued as the follow-up to the Energy and Mineral Resources Ministry?s Regulation No. 7/2012 on the prohibition to export raw minerals.

He said that as many as 213 companies have been awarded mining permits in the province. But only 35 of them still actively operate, the other 196 firms have stopped their operations or only operate when the mineral prices are high.

Many mining companies have been forced to stop operations due to the export restriction because they can not afford to pay the tax export, he added. ?We therefore asked the miners to set up a consortium to build a smelter so that they can produce processed minerals,? he said.

Marzuki said that the local government and the Energy and Mineral Resources Ministry recently signed a memorandum of understanding (MoU) on the appointment of West Sumatra as the host of the pilot project for the development of geothermal energy.

West Sumatra, especially, South Solok regency, is rich in geothermal reserves. The exploration activities will be begun on Sept 21, he added, (*)