Domestic beneficiation policy in mining sector: A case study of Indonesia

Abstract

The purpose of this study is to compare beneficiation policy between oil, coal, gas and metal mining sector in Indonesia. The empirical fact shows Indonesia's Constitution of 1945 stated that natural resources in Indonesia are controlled by the state to be exploited to the greatest benefit of the people. However, Indonesia's prevailing law has varied interpretation of this term. This is shown in differentiation of beneficiation policy between oil, coal, gas and metal mining sector in Indonesia despite the same philosophical basis of the utilization itself. This study explains the difference of interpretation under Indonesia's Law regarding natural resources beneficiation and how it is furtherly implemented in the sector. This research is normative in nature, using literature study to gather data. The conclusion of this study is metal mining sector is the only sector whom ready to implement domestic mineral beneficiation obligation. While in other sector, Indonesian government and mining stakeholders are not ready to take the risks to establish beneficiation dependency.