A Little Bit about Freeport Indonesia´s Special Mining Permit

Monday, 25 September 2017 , 10:00:00 WIB - Legal Tips

An agreement has just recently been signed on Freeport Indonesia´s shares divestment (ANTARA)

After tight negotiations, PT Freeport Indonesia and the government of Indonesia has finally agreed to replace the former’s permit from a Contract of Work (KK) to a Special Mining Permit (IUPK).

Mining areas are categorized into mineral and coal mining areas. Mineral mining areas are categorized into:

1. Radioactive mineral mining areas;
2. Metal mineral mining areas;
3. Non-metal mineral mining areas;
4. Rock mining areas;

According to Article 76 Law No.4/2009 on Mining, Special Mining Permits are issued for each phase of mining activities. Said activities are exploration, which comprises general investigation, exploration and feasibility studies, and production, construction, mining, processing and transportation and sales.

The permit is granted by the Minister of Energy and Mineral Resources, who would take into account the local interests. It is issued for one mining commodity only, for instance, coal. Therefore, if the producer finds other minerals and wishes to mine it, it must apply for another special mining permit.