Revenue Watch Institute - Seminar on Extractive Industry Governance at the Local Level: Challenge and Opportunities; Jakarta, May 22-23, 2012

1. Sub-National Mining Licensing Framework
Paper and Application to Two Kabupaten (Districts)
in Indonesia- Bangka and Kutai Kartanegara (Kukar)
Preliminary Draft
for Comment and Discussion

2. Sub-National Mining Licensing Framework Paper and Application to Two
Kabupaten (Districts) In Indonesia- Bangka and Kutai Kartanegara (Kukar)
Preliminary Draft for Comment and Discussion1
May 22, 2012
Background and Purpose
While in most countries “mineral rights”, that is the rights to explore for and/or extract
minerals from the ground are vested in the national government, there are a small number
of countries where the mineral rights are vested in sub-national government authorities.
Such countries include Argentina which has a long established system of decentralized
government and Indonesia which has introduced decentralization since 1999.
The purpose of this of this Sub-National Mining Licensing Framework Paper is:
 first, to develop a framework for examining the potential benefits and vulnerabilities
of mineral licensing taking place at the sub-national rather than the national level;
 second; to apply the framework to two districts in Indonesia; and
 third: to propose possible policy recommendations for Indonesia.
The proposed framework consists of three main building blocks, namely the Performance of
the Mining Industry; the Performance of the Government Mining Institutions that oversee
the mining industry; and the Mining Regulatory Framework. These are now described in
detail.
A: The Proposed Framework For Examining Sub-National Mineral Licensing
First Building Block - Performance of the Mining Industry
The Framework starts by examining the performance of the mining industry looking at three
main criteria of a well-functioning mining industry. The first criterion is how much of the
industry is operating legally and how much new investment is being attracted? The second
criterion is whether the industry is operating in line with good international health, safety,
environmental and social practices and in compliance with all relevant laws and regulations.
The third criterion is whether the industry is paying mining fees, taxes and royalties or not.
A well-functioning mining industry will have mining operations and activities that are
properly licensed, environmentally and socially responsible and tax and fee paying. This is
generally the case for medium and large-scale operations but may not be the case for
smaller-scale and artisanal operations. It will also attract investment from a range of good
quality mining companies.
1
A draft paper prepared for Revenue Watch by John Strongman and Ambasari DC for the RWI Jakarta Seminar
May 22-23 2012

3. The potential benefits of sub-national licensing are that local officials should know the local
area better than national officials and be able to processes licenses more promptly than a
local licensing office that is part of a national agency. However, a major vulnerability of sub-
national licensing compared with national licensing is that illegal mining may flourish. A
second vulnerability is that mining may take place with more harmful environmental and
social impacts, including mining in protected areas. A third vulnerability is that mining may
cause unresolved conflict with nearby communities due to conflicting land uses, loss of land
and livelihoods and/or damage to culture –especially in the case of Indigenous Peoples.
While it is possible that illegal or unacceptable mining may take place because of
inadequacies in the mining law and regulations (for example no provision for artisanal
mining licenses) more often than not it is because either mining operations are evading the
authorities due to a lack of enforcement capacity or because they are flouting the law with
the complicity of local authorities.
Generally speaking most medium and large-scale legally licensed operations will be in
compliance, or working towards compliance, with licensing, safeguard and fiscal laws and
regulations. The question is whether or not this will also be the case for licensed small-scale
and artisanal operations. Almost certainly any illegal operations will be polluting, unsafe and
avoiding paying mining related fees and taxes.
Second Building Block - Performance of the Government Mining Institutions
After examining the performance of the mining industry, the next building block examines
the performance of the government mining institutions in overseeing and administering the
industry and implementing the mineral licensing system. There are four main authorities to
consider as follows:
 a Mineral Licensing Office which is responsible for overseeing and administering
mining rights and collecting industry production and performance data
 a Granting Authority which grants and signs the mining right in the form of a license
or contract
 a Mining License Cadastre (record keeping) Office which is the repository of all
exploration and mining licenses and is responsible for ensuring that licenses do not
overlap and for making license and licensing information available to interested
parties
 a Mines Inspection Agency which supervises mining activities at the mine sites
including compliance with license conditions and obligations such as occupational
health and safety requirements.
Other agencies include the Geological Survey which holds the geological information for the
country and which may also undertake geological survey work; and other units within a
Mining Ministry or Mines Department which may include an Artisanal and Small-scale

4. Mining (ASM) Unit, an Environmental Unit; a Social/Community/Gender Unit; a Policy Unit;
an Economics Unit; and an Investment Promotion Unit.
Well-functioning mining agencies will process licenses and undertake site inspections in a
competent, efficient, non-corrupt and timely manner, with stable and predictable
operations and a willingness and capacity to engage with stakeholders. They will be
adequately resourced with modern information management systems and equipment;
sufficient, well experienced and well skilled staff; and an adequate budget including the
recurrent funding needed for a strong on site presence.
Well governed licensing application and approval procedures will be fully transparent and
secure with all license data and information including license applications protected from
tampering. Licensing records will be kept up to date, secure and accurate and readily
available to any interested parties. This can be best accomplished by license applications
and decisions being registered electronically with public access through an internet-based
web site. They will also have effective grievance or dispute resolution mechanisms that are
accessible, affordable, timely, impartial and effective.
Along with well-functioning mining agencies, there should also be well functioning
environmental institutions that oversee environmental protection compliance, a social
agency that is responsible for oversight of mining-related social impacts such as involuntary
resettlement procedures and compensation and, where applicable, an agency that is
responsible for the protection of Indigenous Peoples rights. There should also be taxation
and possibly other authorities with the capacity to assess, audit and collect taxes, fees and
royalties.2
Corruption and inadequate capacity are two of the most significant vulnerabilities
associated with sub-national licensing authorities. First, sub-national agencies are more
likely to be prone to corruption than national authorities because there may be less
transparency and scrutiny of sub-national licensing practices and signing authorities
compared with national agencies and because the larger number of sub-national mining
signing authorities increases the probability that one or more may be corrupt. Sub-national
officials are also likely to be more prone to complicity with illegal mining operators.
Second, is that given a potentially large number of sub-national authorities3, the weaker sub
national authorities may lack the capacity to strictly follow the licensing procedures and
maintain reliable licensing records with the result that they become prone to issuing
licenses that overlap with other licenses. A third vulnerability is that it may not be possible
to maintain a national mining cadastre either because accurate licensing data is not
available or because sub national authorities do not update the national authority in an
accurate and timely manner. This can be part of a larger sector wide vulnerability that sub-
national licensing offices do not share license, production and performance data with other
2
In Indonesia profits taxes are collected by the Directorate General of Tax but royalties which are considered a non-tax
charge are collected by the Directorate General of Minerals and Energy
3 Indonesia has about 400 Kabupatens (Districts)

5. arms of government such as environmental, social and taxation authorities including those
authorities collecting royalties or fees as opposed to profits taxes.
Third Building Block - The Mining Regulatory Framework
Having examined the performance of the mining institutions, the third and final building
block is to examine the underlying mining framework of laws and regulations that provides
the legal basis for the licensing procedures and the authorities and responsibilities of the
mining institutions in implementing the licensing system.
A well-designed mining regulatory framework will have laws, regulations and procedures
that are uniform, clear, stable, predictable and non-discretionary and that not only define
the government authority and responsibilities but also the rights and obligations of license
holders.
While the main focus is on exploration and mining, a well-designed licensing system will
cover all stages of the mining life cycle – from initial prospecting to mine closure, mine
reclamation and rehabilitation, and, if needed, post closure protection and monitoring.
Well-designed mining laws and regulations will provide licensing procedures that are
transparent and clearly specify license holder qualifications or, in the case of competitive
processes, evaluation criteria along with licenses or contracts that specify the term, area
size, geographical coordinates and minerals covered.
Well-designed mining laws and regulations will clearly specify Government authority to
process, issue, renew and cancel licenses that are “criteria-based” and non-discretionary i.e.
the legal provisions should be that “licenses shall be granted” subject to meeting given
criteria, not “may be granted”. They will also outline the main responsibilities of
government which should include the responsibility to ensure transparency and accurate
license record keeping and data bases as well as responsibility for timely and accurate
information transmission between different agencies and levels of government.
Well-designed mining laws and regulations will also specify the license holder rights which
should include security of tenure; exclusivity of license area; license renewals; license
assignment; and conversion of exploration licenses to mining licenses. They will also detail
the main obligations of the license holder which should include fulfilling any specified work
requirements including minimum expenditure requirements, complying with any and all
license conditions including mine closure requirements and information disclosure and
reporting obligations, undertaking community consultations, paying taxes and fees and
putting aside funding as required for mine closure and possibly post closure.
A well designed and implemented mining licensing system is necessary, but not sufficient, to
achieve sustainable mining development. In addition, environmental and social laws and
regulations and institutional roles, authorities and responsibilities are needed that ensure

6. that exploration and mining (including mine closure) take place in an environmentally and
socially acceptable manner and, where applicable, that the rights of Indigenous Peoples are
fully respected. Well-designed environmental and social laws and regulations will include
environmental and social impact assessments and environmental management, social risk
mitigation and community engagement plans.
In addition, there should be a profits taxation system that provides a fair distribution of the
economic rent (profitability over and above a normal risk-adjusted rate of return) of a
mining operation between the government (as owner of the resource) and the license
holder (as developer and operator of the mining operation). Many countries also have
mining royalties based on production volumes or values. The overall mining taxation system
including royalties and other charges should be progressive and efficient.
There are few if any easily identifiable benefits of sub-national mining legislation and
regulations. But there can be substantial vulnerabilities when sub-national authorities have
the legal authority to set their own licensing rules. This will then result in different licensing
rules in different sub-national jurisdictions. A first vulnerability is that different sub-national
legislatures may not have the capacity and resources to prepare well-designed licensing or
safeguard regulations and rules. The greater the number of jurisdictions, the greater is the
risk that some will have poor quality rules and regulations. A second vulnerability is sub
national regulations may be highly discretionary and opaque – with associated risks of
corrupt practices. A third vulnerability is that licensing agencies may not be obligated to
disclose license, production and performance data with other authorities such as taxation,
environmental, social, health, safety, and lands authorities as well as agencies responsible
for protecting Indigenous Peoples.
Other vulnerabilities are that there may be a lack of consistency between sub-national
licensing rules in different jurisdictions and other related laws and regulations, including at
the national level. One example would be sub-national licensing rules that are not
consistent with the national mining law. A related vulnerability is that different licensing
procedures, systems, and cadastre data codification will result in a lack of compatibility for
coordinating the activities and data bases of different sub national authorities. These
various vulnerabilities can create substantial barriers to attracting large investments from
good quality investors, especially international investors.
B. Applying The Framework to Two Districts In Indonesia - Bangka and Kutai
Kartanegara (Kukar)
This section describes the application of the Framework to two districts in Indonesia, namely
Bangka and Kutai Kartanegara (Kukar) and also gives examples from some other districts.
These two districts were selected because both have issued a large number of licenses (see

7. Annex 1) and are considered to be important mining districts. The application follows the
three building blocks. In considering the performance of the mining industry it should be
noted that following the enactment of a new Mining Law (Law 4/2009) the national
government has placed a moratorium on new mining operation permits licenses (IUPs)
being issued and has undertaken an audit of 10,235 mining licenses and found that only
4,151 (about 41%) of the licenses are considered to have “Clean and Clear” (CNC) title.
First Building Block - Performance of the Mining Industry – Bangka and Kukar
The research found that there is a major illegal mining vulnerability in Bangka, which is a tin
mining district, where as much as half of tin mining may be illegal, all of which is artisanal or
smaller-scale mining. Small-scale miners have swamped old mining areas and are illegally
producing tin – with a reportedly massive local “mafia” of vested interests financing and
controlling much of the illegal mining. The ambiguity and inconsistency of regulations
between the local and national levels, as well as lack of law enforcement, have contributed
significantly to illegal mining flourishing. In particular, the district government has issued
and legalized mining licenses that do not comply with regulations at national level.
Needless to say the illegally mined tin avoids production-related taxes. Illegally produced tin
is sold to legal miners and tin buyers who add it to their stocks when selling to smelters. It is
also sold to directly to smelters who include it as legal feedstock or it is simply exported
illegally. As illegal mining practices have become rampant, environmental damage has
increased substantially and is now bordering on devastation of some areas in Bangka. As of
May 2012, only 17 IUPs out of 283 issued by the Bangka district authority received Clean
and Clear (CNC) status. Livelihoods are shifting from agriculture (pepper farm) to illegal
artisanal tin mining and there are reportedly also many outsiders who have gone to Bangka,
attracted by the tin mining earnings.
While problems with illegal mining may not be as great in Kukar as Bangka, the research
found that there are considerable vulnerabilities in Kukar associated with over-lapping
licenses with only 240 IUPs out of 485 IUPs issued by the district government receiving CNC
status as of May 2012. The main vulnerabilities are associated with smaller-scale and
possibly also medium-scale mining. New licenses are often issued that overlap with existing
licenses so overlapping licenses is a growing problem. License overlaps can result in
production not being reported and being traded outside the legal system. 4 Kukar has a large
4Examples of over lapping licenses in other districts include IUPs owned by PT. Bukit Asam (the coal state-owned company)
being overlapped by 16 other IUPs in South Sumatra, In South Sulawesi, IUPshave been issued that overlap with IUPs
owned by PT. Aneka Tambang (another mining state-owned company). In Central Sulawesi, Rio Tinto is in a dispute with 14
other IUP holders that overlap the Rio Tinto IUPs and PT. Inco is also in a dispute due to overlapping licenses. The biggest
dispute caused by overlapping is experienced by Churchill Mining, an Australia company which will possibly go to
international arbitration. There are also examples of IUPs being issued by districts that overlap with forest and conservation
areas. These include the district of Kolaka in Southeast Sulawesi, some districts in the Province of Jambi, and the district of
In Bengkulu

8. amount of coal production and environmental impacts are poorly managed, for example
polluted water waste and pollution from coal stockpiles. There are also reportedly frequent
conflicts between the mining operations and the people living in the area in both Kukar and
Bangka.
Second Building Block - Performance of Bangka and Kukar Government Mining Institutions
The research found that according to media reports and investigations as well as interviews
with stakeholders, there are many reported concerns and vulnerabilities regarding poor
governance and corruption. Civil society representatives report concerns about the award
and trading of licenses in both Bangka and Kukar are not transparent and are prone to
corruption. There are also reports that the mining sector mafia in Bangka reportedly has
close links to some of the public officials. In Kukar license approvals are reported to
normally take nine months or more but some applicants are able to get special treatment
with licenses issued in just a few days. Some applicants in Kukar are reportedly allowed to
apply for adjacent license areas of less than 100 ha each and thereby avoid environmental
protection requirements which are required for licenses for areas over that size. In both
Bangka and Kukar, the Energy and Mining Office budget and staffing are relatively small to
oversee mining activities. For example, Kukar had an occupational safety and health
inspection budget of only Rp 375,000 (USD 41,700) in 2011 5 which was sufficient for
inspections to be undertaken at only 65 out of 285 operations in Kukar. There are only 16
officials in Kukar that have mining, geology, and environmental qualifications in their
educational background. Kukar has a complaints mechanism for environmental issues that is
only partially effective and no such mechanism for communities for conflict resolution with
mining operators. Bangka has neither mechanism.
Until 2010, mining companies were making their royalty payments to the national
government without any reporting to the local governments. The national government
subsequently transferred the royalties to the local governments under the scheme of
revenue sharing fund (DBH). But not knowing precisely how much money was being paid by
the mining sector and by which companies, the local governments were unable to verify if
the full amounts were being paid to them by the national government. They were also
unable to verify if the mining companies were paying royalties on their full production.
Starting in 2010 the mining companies have been required to provide local governments
with copies of the proof of the amount of royalties being paid to the national government.
Thus, local government including Bangka and Kukar can now hold the national government
5
Out of a budget of Rp 1,300 million for mining activities; by comparison Banka’s total budget for mining activities was about
Rp 2,200 million in 2011. Both budgets are very small to undertake monitoring and oversight activities to the very large
number of mining companies in each district.

9. accountable if the amount transferred to the local account does not match with amount
they calculate from copies of the proof of royalty payments.
Third Building Block - The Mining Regulatory Framework - Bangka and Kukar
Underlying the poor performance of both the mining industry and the government offices in
Bangka and Kukar6 is a mining regulatory framework in which licensing procedures and
regulations are set by each district. This creates vulnerabilities in terms of how well the
regulations are designed in terms of detail and linkages to other related laws and
regulations (such as environmental and social safeguards). The national government has
stepped in to revoke sub-national mining laws which have not been consistent with national
laws including in the case of Kukar where the 2001 mining regulation was been revoked in
2008 due to not being in line with tax law
The disparities between mining rules in different jurisdictions are well illustrated between
Bangka and Kukar. In both cases the regulations were issued in 2001. First, Bangka has three
types of licenses, the IUP (general mining license), a PUP7 (mining operation agreement) and
an IUPR (people mining license) whereas Kukar just issues an IUP. Second, Bangka issues
licenses for two mining stages in line with the new 2009 mining law – exploration and
production. Kukar issues licenses for six stages - general investigation; exploration;
exploitation; processing and refining; transport; and selling which is in line with the 1967
Mining Law. Third, Bangka’s licensing procedures are considered to have appropriate detail
and to be understandable whereas Kukar’s lack specificity and are not related to other
regulations. Annex 2 provides a comparison of some of the features of mining regulations in
six different districts which illustrates that the differences are greater than the similarities.
However, the situation should improve with the application of the 2009 Mining Law.
However, neither requires transparency of licensing procedures and information or
obligates licensing offices to make data available to other government offices, in particular,
taxation authorities. Most importantly both give complete discretion to the Regent in the
issuing of licenses. In the case of Kukar, many legitimate investors may simply not apply for
licenses for fear of graft or fear of the licenses area being awarded on a preferential basis to
a local vested interest, relative or crony of the issuing authority because of the high degree
of discretionary power regarding licenses being issued. But equally, in the case of Bangka
legitimate investors may not apply because of the influence of the mafia.
Summary
6
Kukar mining regulation has been revoked in 2008 due to not in line with tax law.
7
This is an agreement for holder of exploration license to apply for license of exploitation and production. PUP must be
approved before the holder carry out production.

10. In summary, the main conclusions of applying the framework to Bangka and Kukar based on
information received are as follows
Mining Industry Performance:
 Extensive illegal mining and smuggling including mining in protected areas
 Unacceptable, non-compliant environmental and social impacts
 Tax avoidance by illegal mining operations
Government Mining Institutions
 Considerable corruption – licensing graft, bribery and cronyism
 Inadequate mining licensing records
 Newly issued licenses that overlap other licenses or protected areas
 Insufficient mine site inspections and lack of oversight of illegal mining
Mining Regulatory Framework
 Inconsistent and inadequate sub-national licensing rules and procedures and
environmental and social safeguards including conflict resolution
 Excessive discretionary power to license offices and Mayors/Governors
 Inadequate release of licensing information and environmental performance and
social impact data
C. Preliminary Policy Recommendations for Indonesia.
Having presented the application of the framework to Bangka and Kukar, this section
provides some preliminary policy recommendations that might point a way forward to
reducing the vulnerabilities and improving the situation.
Building Blocks 1 and 2: Improving the Performance of Mining Operators and Government
Institutions
Because the performance of mining operators and government institutions are closely inter-
linked this section considers ways to address not only the mining companies’ vulnerabilities
of illegal mining, harmful environmental and social impacts and tax avoidance but also the
mining institutions’ vulnerabilities of corruption, inadequate licensing record keeping,
overlapping licenses and insufficient inspections.

11. The national government has set the stage for improvements by enacting the new Mining
Law (number 4 of 2009) and also issuing the implementing regulations. With this
background, improving the situation has two main elements.
 First, is effective implementation of the new 2009 Mining Law which will require
time and a sub-national government commitment to reducing and eliminating illegal
mining, over lapping licenses and harmful mining environmental and social
performance.
 Second, is the provision of greater resources to sub-national Energy and Mining
Offices to put in place professional leadership and build better management and
information systems and more competent and qualified staff to reduce these
vulnerabilities.
A greater sub-national government commitment will likely involve for some authorities a
shift away from corrupt practices. Greater openness and transparency regarding licensing
information and improved reporting to national government are preconditions for improved
mining sector governance.
The situation in Bangka is especially difficult given the strong and entrenched mafia who will
likely oppose any improvements. If the situation is to be improved and the vulnerabilities
reduced, it will require some combination of identifying practical ways to:
 legalize presently illegal mining operations that are willing to report their tin
production, pay taxes and improve their environmental performance and
 Close those operations that persist in smuggling their tin and refuse to improve their
environmental practices.
On Bangka, it will require both the commitment and the capacity to put in place closer
scrutiny of licensed miners and smelters who may take possession of or process illegally
mined materials. It will also require a forceful engagement with the mafia who will likely not
cede their control of much of the industry willingly. Such a change will not come easily and if
it is to happen will likely require strong national government support and oversight.
In the case of Kukar, there is a need for greater oversight and policing of illegal mining, in
particular, unreported production from overlapping license areas. But the greater
vulnerability may relate to graft and corruption in issuing licenses, including issuing licenses
that overlap with existing licenses. This also becomes an issue of political will to reduce
corruption and build greater capacity to follow licensing rules, keep accurate and up to date
licensing records and inspect all mining operations on a regular basis.
The national government has made a very substantial start to improving the licensing
situation through its Clean and Clear program, but the issue remains as to what will happen

12. regarding the licenses that are not clean and clear, including license overlaps. License
overlaps should be eliminated in favor of the first license holder.
Greater scrutiny by national government including increased and regular auditing of licenses
would be an important measure to reduce and eventually prevent over lapping licenses
being issued in future. But to be fully successful, each district would need to maintain an
accurate record of the geographical coordinates, term and other conditions of licenses that
have been issued.
The underlying vulnerability of sub-national Energy and Mining Offices lacking sufficient
budgets and staff is a common occurrence in many countries. The reality is that the
likelihood of sub-national governments allocating sufficient resources for their licensing
offices to operate efficiently and effectively is very small. If sufficient funding is to be made
available then most likely it would need to be provided by allocating part of the mining-
related payments to government as dedicated funds to increase the number of staff, to
provide training and incentives to improve staff abilities and incentives to retain them; and
to fund investment in improved management and information systems.
Improving the dialogue with civil society can also contribute to reducing vulnerabilities in
both Bangka and Kukar, but this is also in large part a matter of political will and leadership
as much as mandatory national regulatory requirements.
Building Block 3: Improving the Regulatory Framework
The 2009 Mining Law has made an important step towards improving inconsistent and
inadequate sub-national licensing rules, but even so the other two regulatory vulnerabilities
of excessive discretionary power and inadequate disclosure and release of information and
data still need to be addressed through further changes to laws and regulations. Legal
measures can mandate such improvements.
Ideally the 2009 Mining Law should be modified to make the issuing of licenses mandatory,
not discretionary, providing that the licensing criteria have been satisfied.Equally and most
importantly, the laws and regulations should mandate full transparency regarding licensing
applications, evaluation, approvals and records including mandatory disclosure of licensing
information and production, environmental and social performance data Full transparency
is a regulatory change that would considerably improve governance and reduce corruption.
Full transparency is a regulatory change that has the potential to considerably reduce
corruption. Improved transparency with regard to making all the details of license
applications and approvals readily and publically available is a corner stone to

13. improvements which would reduce the vulnerability to corruption. Transparency should be
legislated and regulated and supported by funding for standardized licensing systems at
each license office.
Just as EITI has established the principle of transparency for extractive industries tax
payments and collections, so there should also be licensing transparency
Indonesia has the potential for many more large-scale mines that could bring significant
employment at the local level and wealth to both national and sub national governments
through tax payments and induced growth. But, large-scale investments are no longer
taking place due to the uncertain investment environment, largely created by sub-national
licensing. There is much at stake which would warrant the national government considering
measures to address the present vulnerabilities and improve the licensing system.
But what if sub-national authorities do not follow the new Mining Law or the regulatory
requirements proposed here for greater transparency and information disclosure. The
national government may have to both reward and coerce improved sub national
government performance through legal measures regarding “carrots and sticks”. These
could include
• a moratorium on issuing licenses for non-performing governments and
• adjusting transfers of mineral-related payments to sub-national governments
according to their needs and performance
Finally, the dialogue with and role of civil society can also be enhanced by mandatory
requirements for disclosure of information and consultation with local communities.

14. Annex 1
Districts/Municipalities in Indonesia Issuing Most Licenses in Indonesia
District/ Number of Commodities Provinces
Municipality License
Bangka 283 Tin Bangka Belitung
Tanah Laut 197 gold, chrome, coal, iron South Kalimantan
ore, nickel ore,
manganese
Tanah Bumbu 185 coal, iron ore South Kalimantan
Kutai 153 Coal East Kalimantan
kartanegara
Belitung Timur 150 Tin, bauxite, hematite, Bangka Belitung
iron, Kaolin, quartz
Ketapang 149 Zircon, tin, iron ore, West Kalimantan
bauxite, gold, granite,
kaolin, barite, galena.
Bangka Barat 143 Tin Bangka Belitung
Barito Utara 139 Coal South Kalimantan
Kutai Barat 135 coal (132 licenses), gold East Kalimantan
(3 licenses)
Kutai Timur 133 coal, gold (2 licenses) East Kalimantan
Kotabaru 132 coals, iron ore, limestone South Kalimantan
Kapuas 106 coals, gold South Kalimantan
Barito Timur 105 coals, iron ore South Kalimantan
Konawe Utara 102 nickel (majority), gold, Southeast Sulawesi
chrome, limestone
Morowali 100 nickel, chrome, gold, iron Central Sulawesi
ore
Islands of Sula 98 iron ore North Maluku
Source: own table

15. Annex 2
Comparison of Mining Licensing Regulations in Different Districts
Description Bangka Tanah Bumbu Kutai West Kutai East Barito South Kalimantan Central
Kartanegara Kalimantan
Year of Issue 2001 2007 2001 2003 2004 2009 2002
Name and - IUP - KP is used to - IUP - IUPUD IUP refer to: KP - IUP
type of license - PUP refer the mining - KP - KP
- IUPR license but not - CoW
clearly defined in - CCoW
article 1.
- SIPR
- SIPD
Stage of 2 (exploration 6 (general 6 (general 6 (general Complicated and 5 (general 5 (general
licensing for and investigation; investigation; investigation; mixed between investigation; investigation;
mining activity exploitation) exploration; exploration; exploration; procedures and exploration; exploration;
exploitation; exploitation; exploitation; stages. exploitation; exploitation;
processing and processing and processing and processing and processing and
refining; transport; refining; refining; refining; refining;
and selling) transport; and transport; and transport and transport and
selling) selling) selling) selling) + IUP for
service
Are CoW and No No No No Yes Yes No
CCoW
regulated?
Procedures/ IUP: Detailed Not detailed and Not detailed Not detailed Very detailed of The licensing The licensing
Requirements and easy to must refer to and no other for IUPUD but procedures to procedures procedures
understand. Regent Regulation regulation as not specify apply 13 types regulated under regulated under
IUPR: to be and in annex reference other licensing related Decision of Governor
regulated by (unable to be regulation as to KP; and 37 Governor Regulation
Regent accessed) reference. types licensing
Not detailed in related to CoW
KP and must and CCoW.
refer to
Decision of
Regent
If more than Not regulated First come first First priority is IUPUD: first Not regulated First applicant, Not regulated
one applicant served. decided by priority for first priority
for the same Regent, first applicant
area. KP: not
specified
Source: own table