The Jakarta Post reported that, following clashes between mining companies and local residents, the Indonesian Mining Association (IMA) wants to transfer the right to issue mining permits (IUP) from regents to governors.

IMA executive director Syahrir AB said the central government had to regulate the mining sector to stop regents from issuing overlapping permits and must intervene and solve problems directly if something went wrong.

“Governors, as representatives of the central government, will be more effective in controlling the regions, including supervising what the regents are doing,” Syahrir told reporters after meeting with Energy and Mineral Resources Minister Jero Wacik on Thursday in Jakarta.

The 2009 Minerals and Coal Law grants regents the sole right to issue or revoke IUPs. However, in practice, many problems have appeared since the law was enacted, as different regents have issued conflicting permits for the same areas.

According to the minerals and coal directorate at the Energy and Mineral Resources Ministry, around 60 percent of the 9,662 mining permits issued locally across the nation lacked “clean-and-clear” certification, as they either overlapped with other permits or were not issued correctly.

Syahrir said Indonesia would need a legal instrument to strip regents of their licensing power and to transfer it to governors, such as new government regulations or a revision of the law on minerals and coal.

“We have discussed that with Minister Jero. The response was positive, but it’s just the very beginning of the process. We have just suggested it,” Syahrir said.

Syahrir also said that he and Jero discussed clashes between mining companies, local administrations and local residents.

In the most recent violence, a crowd set fire to Vale Indonesia’s base camp in Morowali, Central Sulawesi, on Monday, demanding that the company stop local operations since local residents did not benefit.

In December, two men were killed by the police in Bima, West Nusa Tenggara, as officers tried to diffuse a protest against PT Sumber Mineral Nusantara (SMN).

Local residents claimed that the company’s operations might disrupt their farms and plantations. Bima Regent Ferry Zulkarnain eventually revoked Sumber Mineral Nusantara’s IUP.

Separately, a mining expert at the ReforMiner Institute, Pri Agung Rakhmanto, said the clashes and permit problems might send a bad message to investors on Indonesia’s investment climate.

Rakhmanto said the clashes were brought on by three factors. First, many impoverished local residents felt that nearby mining activities did not directly improve their living standards.

Second, local administrations were not transparent in informing the people about how much they received from mining activities. Third, the management of mining areas in the nation was still far below expectations.

“The central government actually has the authority to classify and map mining areas, which should be the basis for local administrations to issue IUPs. However, the classification and mapping process have not been completed,” he told The Jakarta Post.

A lawmaker on House of Representatives Commission VII overseeing mining and energy, Satya W. Yudha from the Golkar party, said the House would consider transfering IUP issuance power to governors when it revised the law on minerals and coal.
Source: The Jakarta Post (Rangga D. Fadillah)