August 15, 2023
JAKARTA – The government has temporarily halted all nickel mining operations in the Mandiodo Block in Southeast Sulawesi, Energy and Mineral Resources Minister Arifin Tasrif said on Friday.
The decision came after the Attorney General’s Office (AGO) arrested Ridwan Djamaluddin, the ministry’s former minerals and coal director general, as a suspect in a graft case.
“Yes, it is stopped,” minister Arifin confirmed on Friday, as quoted by Kompas.com, adding that he would respect the legal process with regard to his former subordinate.
According to an AGO spokesman, Ridwan was allegedly responsible for making changes to a 2018 ministerial decree on evaluating the work and budget plans (RKAB) of companies with mining permits.
The revision allowed at least one mining firm with spent reserves to access an extra 1.5 million metric tons of nickel ore deposits in 2022.
PT Kabaena Kromit Pratama is among the firms to have benefitted from the stipulation, by selling its mining operation permit for state miner PT Antam’s 157-hectare Mandiodo concession to unlicensed PT Lawu Agung Mining.
The AGO says the graft has contributed an estimated 5.7 trillion (US$376.2 million) in losses to the state.
Nickel is an important part of the government’s agenda to develop its downstream industries to boost its role as a global electric vehicle (EV) manufacturing hub.
Indonesia is the world’s largest nickel producer with an output of around 1.6 million metric tons in 2022, according to the United States Geological Survey,
The government has banned exports of nickel ore since January 2020 to push the domestic processing industry and to attract investments from global EV producers.
Although nickel mining had been halted in the Mandiodo Block, Antam corporate secretary Syarif Faisal Alkadrie said on Sunday that the firm’s nickel production target for 2023 would remain unchanged, as quoted by Kontan.
Antam sold 6.81 million wet metric tons (WMT) of nickel ore in the first six months of the year, according to Syarif, up 55 percent compared to the same period last year.
The company also said its other nickel mine concession in the Tapunopaka Block, also located in Southeast Sulawesi, was continuing to operate normally.
Ridwan was appointed in 2020 as the energy ministry’s number one man to regulate the nation’s mining industry and stayed in the position until he stepped down early this year.
He has also served previously as the transportation and infrastructure undersecretary at the Office of Coordinating Maritime Affairs and Investment Minister Luhut Binsar Pandjaitan.
Home Minister Tito Karnavian appointed Ridwan as acting governor from May 2022 to April 2023 of the Bangka Belitung Islands, the country’s largest tin source contributing 90 percent of national output.
Around two months before he was named as a suspect, Ridwan stepped down in June as a commissioner of state-owned mining holding company MIND ID, which administers state miners such as PT Antam, PT Freeport and PT Inalum.