The Constitutional Court (MK) has rejected a judicial review of Law No. 3 of 2020, which amended the Mineral and Coal Mining Law (Law No. 4 of 2009), specifically the provisions granting mining licenses to mass organizations, private companies, and religious groups. The review, filed under case number 77/PUU-XXII/2024, sought to challenge the legality of such provisions.
“The Court rejects the petitioner's request in its entirety,” said Chief Justice Suhartoyo, delivering the verdict on Friday (January 3) at the Constitutional Court Building in Central Jakarta.
Justice Arsul Sani explained the Court’s legal considerations regarding Article 6 Paragraph (1) letter j, amended by Article I point 4 of the Mining Law. The petitioner argued that this provision violated Article 33 Paragraph (3) of Indonesia's 1945 Constitution, asserting it granted excessive powers to the central government in designating Special Mining Business License Areas (WIUPK) to religious organizations, as specified in Government Regulation (PP) 25/2024.
In response, the Court examined the petitioner’s concerns and focused on the content of Article 83A Paragraph (1) of PP 25/2024, which refers to Article 6A Paragraph (1) of the Mining Law. The Court emphasized that government regulations, as implementing rules, must align with the parent law.
“Government regulations must adhere to the provisions of the law and cannot conflict with or deviate from its substance,” Arsul stated.
The petitioner's argument, which centered on the legality of implementing regulations rather than the constitutionality of the Mining Law itself, was deemed outside the Court’s jurisdiction. As a result, the Court concluded that the petitioner’s claim was legally unfounded.
The Court also addressed concerns about religious groups prioritizing Special Mining Business License Areas (WIUPK) despite lacking the technical expertise to manage mining operations. The Court stressed that the Mining Law ensures a structured mechanism for obtaining a Special Mining Business License (IUPK) via a WIUPK auction process, requiring private businesses to meet technical and environmental standards.
Moreover, the law mandates that mining companies employ qualified personnel, with at least three years of experience in mining or geology. This ensures that companies engaged in mineral and coal mining operations possess the necessary capacity for sustainable and environmentally responsible practices.
“The law also requires companies to submit a work plan and budget (RKAB) during the exploration phase, serving as a tool for supervision to ensure compliance with technical and environmental standards,” Arsul noted. Consequently, the petitioner’s concern regarding potential environmental damage was dismissed as unsubstantiated.
In May 2024, President Joko Widodo signed Government Regulation No. 25/2024, which allows the government to grant mining concessions directly to community-based groups including religious organizations, bypassing the auction process for acquiring mining areas.
The government has designated six former coal mining areas for management by religious organizations, including sites previously managed by PT Arutmin Indonesia, PT Kendilo Coal Indonesia, PT Kaltim Prima Coal (KPC), PT Adaro Energy, PT Multi Harapan Utama, and PT Kideco Jaya Agung.
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Reports indicate that Nahdlatul Ulama (NU), the country’s largest Islamic organization, has received a coal concession previously operated by KPC in East Kalimantan. Muhammadiyah, the oldest Islamic organization, is also reported to have been granted a coal concession from a large mining firm.
Muhammadiyah, NU set up mining entities
Meanwhile, Muhammadiyah's Central Leadership (PP) has announced the establishment of PT Mentari Swadaya Ecomining (PT MSE), a limited liability company to manage a former coal mining concession area (PKP2B). The company will operate under Muhammadiyah's business arm.
“PT MSE is owned by Muhammadiyah’s Business Entity (BUMM),” said Anwar Abbas, Chairman of PP Muhammadiyah, in an interview with Kontan on Sunday (January 5). However, operations have not yet commenced due to the absence of a government-issued Mining Business License Area (WIUP) decree.
“We cannot proceed with the board of commissioners and directors until the government issues the WIUP decree,” he explained.
Muhammadiyah is still awaiting confirmation regarding the mining areas it will manage in 2025. “There has been no progress,” Abbas stated.
Earlier, Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia mentioned two possible mining sites for Muhammadiyah: former mine sites operated by PT Arutmin Indonesia or PT Adaro Energy Tbk.
NU has also formed a mining business entity named PT Berkah Usaha Muamalah Nusantara (BUMN), which will manage a 26,000-hectare mining concession in East Kalimantan. The area was formerly operated by PT Kaltim Prima Coal (KPC), a subsidiary of the Bakrie Group. NU Chairman Yahya Cholil Staquf confirmed the formation of this business entity and said that shares are owned by NU’s cooperative, with management provided by its administrators and members.
“We are working on fulfilling the necessary requirements to start exploration,” said Yahya, referring to the potential for reclamation. “We are also seeking investors to help fund the project.”
Editing by Reiner Simanjuntak
