Mineral and coal investment in Indonesia is expected to decline until 2024, said chair of Indonesian Mining and Energy Forum - Photo by EMR Ministry Office

JAKARTA (TheInsiderStories) – Indonesian government hope the smelter owned by PT Amman Mineral Nusa Tenggara (AMNT) in Sumbawa, West Nusa Tenggara, to be be completed by the end of 2022. The new smelter has capacity 1 million tons per year and has available rising to around 2 million tons per year.

As is known, AMNT has changed the form of mining license from contract of work to a special mining business license for its operations. Based on the government regulation the miner must build smelter after get the new permit.

It said, the concentrates for the smelter will supply from Batu Hijau mine as well as potential supply from the Elang mine–currently in the exploration stage–and other sources.

Deputy minister for Energy Minerals Resources (EMR) Arcandra Tahar, who visited Sumbawa on yesterday, requested AMNT immediately submit the detailed plans of the smelter. The project , targeting to develop in stages until 2022.

“The company is one of the pioneers of the implementation of government regulation Number 1 of 2017 and its derivative legal products. One of them is marked by the targeted operation of the smelter at the latest by 2022,” he said in the official statement on Friday (08/09).

In its presentation to Tahar, AMNT is committed to completing the construction of the smelter within five years period. While, the exploration activities at the 2,000 hectares land, which is Batu Hijau owned 1,000 hectares with 1,200 meters of drilling site and Elang Block managed 500 hectares with 53,900 meters of drilling site.

As Rinti Block in the form of 500 hectares land and drilling site around 2,500 meters. In addition, the overburden removal activity will be carried out entirely in phase 7, with a capacity planned of 206.16 million tons and ore mining 630 thousand tons.

In 2019, the company through its affiliated, PT Amman Mineral Industri (AMIN) has scheduled a final investment decision and front end engineering design so that it can start the construction phase construction of a copper concentrate refining facility that includes a precious metal refinery.

Overall, AMNT activities will increase in 2019 to US$1.15 billion. This was mainly due to an increase in mine site operating costs of $54.7 million, capital expenditures of $43.7 million, exploration and advanced project costs of $2.0 million, which was offset by a decrease in mine site non-operational costs by $46.4 million.

In this year, the company aimed to sell 373,000 WMT of concentrate (or 339,000 DMT), with details 336,000 WMT for export and 37,000 for domestic. The company will also wants to conduct an initial public offering by eyeing funds of $600 million.

Meanwhile, Revision of Law Number 4 of 2009 concerning Mineral and Coal is still struggling in parliament. Until now the discussion is still struggling about the contents of the problem inventory list. The House has invited EMR Minister Ignasius Jonan and Industry Minister Airlangga Hartarto days ago but the discussion was tough again.

Jonan has proposed the issue of downstream incentives included in this revision. The provision of incentives to those who build processing and refining facilities and the Mine Mouth Steam Power Plant has not been clear.

A number of incentive options are still being considered. For example, the exemption from the obligation to meet domestic coal needs for electricity interests for those who build a Mining Mouth Steam Power Plant.

Jonan revealed that if the proposal was accepted, the revision would only include provisions for incentives for downstream. Regarding the form and amount of incentives will be regulated in separate provisions under the authority of the Ministry of Finance. These incentives can be in the form of fiscal or non-fiscal incentives.

Written by Lexy Nantu, Email: lexy@theinsiderstories.com