Mineral sector to suffer more than coal
Monday, March 12 2012 - 11:35 AM WIB
The adoption of government regulation (GR) No. 24/2012, which requires the divestment of 51 percent stake in foreign-owned mines within 10 years of commercial operation, will have a much bigger impact on the mineral sector than the coal industry, said an industry player.
Executive Director of the association of Indonesian coal miners (APBI) Supriatna Suhala said Monday that it was because the mineral industry is a more complicated sector than coal which requires a more sophisticated technology.
?That?s why we still need foreign investors. In the meantime, investment in coal mining business is not as complicated as it is in the mineral. We have so many national ?conglomerates? who are capable of investing, be it in financing side or technology,? Supriatna said.
?It?s fair to say that mineral mining carries a higher risk than in coal.?
Under the newly-revised regulation, gradual divestment has to be carried out after 5 years of production and the sale of all 51 percent stake has to be completed within 10 years after production.
Editing by Dadan Wijakssana