Jakarta – Publish What You Pay (PWYP) Indonesia has firmly rejected the Draft Bill on the Fourth Amendment of Law No. 4 of 2009 on Mineral and Coal (Mineral and Coal Bill). The rejection was conveyed by PWYP Indonesia’s National Coordinator, Aryanto Nugroho, during a public hearing of the Legislative Body (Baleg) of the House of Representatives (DPR) on February 3rd.
During the hearing, several criticisms and concerns were raised about the ongoing discussions surrounding the Mineral and Coal Bill.
“This bill emerged suddenly, being discussed during the recess period, and it was not included in the National Legislation Program (Prolegnas). It seems rushed, and the public is still struggling to find the academic draft. This issue was acknowledged and complained about during the first Baleg meeting on this bill on January 20th,” Aryanto stated.
Aryanto emphasized that both the DPR and the government should learn from the development of Law No. 3 of 2020, which amended Law No. 4 of 2009 on Mineral and Coal Mining. This law faced widespread rejection from various sectors.
Opening his statement, Aryanto referenced several regulations from previous administrations. First, Presidential Decree No. 1 of 2022 on the Task Force for Land Use Organization and Investment Structuring, led by Bahlil, the Minister of Investment/Head of the Investment Coordinating Board (BKPM) at the time.
One of the tasks of this task force was to evaluate mining licenses deemed unproductive, resulting in the government revoking 2,078 mining licenses, although only 180 licenses were publicly disclosed by BKPM. To this day, Aryanto noted, it remains unclear which licenses were revoked.
Subsequently, Presidential Regulation (Perpres) No. 70 of 2023 on Land Allocation for Investment Structuring was issued, creating a task force to allocate land. Following that, Government Regulation (PP) No. 25 of 2024, which amends PP No. 96 of 2021 on the Implementation of Mineral and Coal Mining Business Activities, was introduced. This regulation includes provisions on granting mining licenses to religious organizations (Ormas), universities, and SMEs, followed by the revision of Perpres No. 70/2023 to Perpres No. 76/2024.
Aryanto questioned whether the Minerba Bill, which includes provisions for granting mining licenses to religious organizations, universities, and SMEs, is based on the evaluation results of the earlier regulations.
“Our question is whether the current revision of the Mineral and Coal Bill, which discusses granting mining licenses to religious organizations, SMEs, or universities, aligns with the results of the task force’s work as outlined in the Decree or the Presidential Regulations. Has the DPR, the Working Committee (Panja), or Commission XII received accountable and transparent reports on the performance of the task force? Does the granting of priority licenses in the Minerba Bill align with this or not?” he asked.
He further explained that it is important to understand whether granting priority licenses to certain entities under the Minerba revision is independent or part of land structuring efforts outlined in Perpres 76/2024. “If these provisions on licenses to religious organizations, universities, and SMEs stand alone, the question is, is there an effort to add new licenses or auctions?” he added.
According to PWYP Indonesia’s observations, there are still unresolved mining issues. Drawing lessons from the KPK’s GNPSDA report from 2014-2018, the government has faced challenges in terms of supervision, guidance, and law enforcement (Gakkum) over the thousands of mining licenses granted at that time.
Even today, the government is still dealing with illegal mining (PETI). Despite the large number of licenses, there has been inadequate oversight, guidance, and enforcement. The Ministry of Energy and Mineral Resources (ESDM) has established a new Directorate General (Ditjen) for Gakkum, but to date, the progress and performance of this directorate remain unclear.
“We should strengthen supervision, guidance, and enforcement first before opening up new permits. If new permits are granted with weak oversight, we fear that, as reported by the GNPSDA, 90% of mining permits will not pay reclamation guarantees again, as the oversight is weak. For this reason, we suggest a moratorium on coal permits,” Aryanto stated.
Regarding coal production, according to the 2019 National Energy General Plan (RUEN), coal production should be capped at 400 million tons. However, in the past five years, coal production has doubled beyond this target. Granting mining licenses to religious organizations, universities, and SMEs would further increase national coal production, moving it further away from the RUEN target.
Aryanto Nugroho criticized the proposal to grant mining licenses to universities. For PWYP, granting mining licenses to universities is an inappropriate policy and carries financial risks.
“Universities’ primary task is the Tri Dharma Perguruan Tinggi (the Three Pillars of Higher Education). Mining enterprises, which require significant capital, long-term commitment, and high risks, are not suitable for universities. The real role of universities is to provide human resources (HR). What is often forgotten is the importance of knowledge transfer,” he remarked.
Rather than granting mining licenses, universities should focus on maximizing their role in knowledge transfer. Universities should be encouraged to create technologies, which industries could then adopt. This, according to Aryanto, is the true empowerment of universities based on their core mission.
“We should focus on strengthening technology transfer. Why not encourage universities to create technologies, patent them, and support industries? This way, industries benefit from university patents, and universities can generate income from patents used by industries. This strengthens university laboratories. The role of universities should be to enhance technology transfer and innovation, supported by industries. Universities and industries should grow together, with knowledge being the foundation,” he explained.
Regarding education funding, Aryanto believes the government could maximize state revenue potential to support quality and affordable education, without requiring universities to engage in mining.
Another issue raised by PWYP during the hearing was downstreaming, which, although not explicitly mentioned, is actually addressed in the Minerba Law. The law mandates that holders of mining permits (IUP) must add value to their resources. However, the failure to implement this obligation stems from the government’s inconsistent approach, as it has relaxed export regulations. Without consistency, downstreaming will remain difficult to achieve.
A final note on the revision of the Minerba Law is that it should prioritize governance aligned with energy transition and inclusivity. Granting mining licenses to religious organizations, universities, and SMEs must go beyond just land prioritization. Inclusivity involves gender equality, respect for human rights, increasing female workforce participation, and worker protection.
At this moment, the focus should be on how the mineral and coal mining sector can address climate change challenges, thus supporting energy transition goals. The revision of the Minerba Law should align with addressing climate change challenges.