Big mining companies driving Omnibus Law to circumvent permit limits

Tempo – May 4, 2020
Gejayan Calling rally against Omnibus Law in Yogyakarta – March 9, 2020 (Antara)

Budiarti Utami Putri, Jakarta – Mining Advocacy Network (Jatam) Coordinator Merah Johansyah Ismail suspects that the owners of mineral and coal (minerba) mining businesses are driving the Draft Omnibus Law on Job Creation. Ismail says that there are two giant mineral and coal companies which control 60-70 percent of the national coal production.

Ismail said that the mining permits of three of these companies will expire at the end of the year. “We can see that they are the ones driving the Omnibus Law”, said Ismail during a vertical press conference on Sunday May 3.

Ismail said that these mineral and coal companies have an interest in the cluster of regulations in the Omnibus Law related to mining. One of these is Article 169A on the automatic extension of mining permits without the land having to be returned to the state and going through another tender process.

Yet the Law on Coal and Mineral Mining requires that companies must return the land to the state if their mining permits have expired. The companies also have to adhere to the regulations on the limits on the size of the area being mined which is restricted to 15 thousand hectares.

Meanwhile seven of these companies actually have mining concessions covering between 40 and 110 thousand hectares. He says that some of these companies are owned by business tycoons who hold leadership positions in political parties at the House of Representatives (DPR) or who were part of President Joko “Jokowi” Widodo’s election campaign team during the 2019 presidential elections.

“The political compensation is clear here, we call it an Omnibus political bond politics (ijon politik)”, said Ismail – referring to the practice of business people making donations to candidates in return for favours after they get elected.

Ismail believes that this is the same as placing the state under the control of business entities rather than the reverse. He also said that it violates the Constitution. This is why Ismail is taking part in a suit submitted with the State Administrative Court against the presidential letter issued by Widodo authorising the DPR to deliberate the bill.

According to Ismail, the Omnibus law will cause even more damage to the environment and is critical of the government which instead wants to facilitate mining businesses, yet the environmental damage already being caused by mining has never even been evaluated.

According to Jatam, 34 percent of Indonesia’s land area has already been allocated for mining permits. Yet the Omnibus Law instead seeks to revise the stipulations so there are no restrictions on the size of mining concession.

“Damage will not just occur on large islands, but also in coastal areas, the sea and small islands”, said Ismail.

Not only that, he continued, the Omnibus Law also fails to pay attention to overlapping between mining areas and disaster prone areas. Ismail says that there are already many mining and geothermal operations in areas that are prone to earthquakes, tsunamis and flooding.

[Translated by James Balowski. The original title of the article was “Pengusaha Minerba Diduga Tunggangi Omnibus Law RUU Cipta Kerja”.]