Indonesia regulatory changes to bring more uncertainty to coal sector – by Fransiska Nangoy (Reuters U.S. – June 26, 2019)

NUSA DUA, Indonesia (Reuters) – Indonesian coal miners said upcoming regulatory changes are putting added pressure on their businesses amid depressed prices and rising competition from other energy sources.

The Indonesian government is in the process of amending coal mining rules to enforce implementation of a 2009 mineral law that require miners to convert their mining permits to a licensing system upon the expiration of their current contracts.

The issue was one of the most talked about by local miners at the Coaltrans industry conference in Bali this week.

The coming change has already affected investment sentiment, an Indonesian coal miners group said, and there are fears the reluctance to invest could spread to related sectors such as power generation, even amid a push to add 35 gigawatts to the country’s power capacity and boost infrastructure investment to prop up sluggish domestic spending.

“This is a big concern for us, because coal investment is not a short-term investment,” said Hendra Sinadia, executive director of the Indonesia Coal Mining Association, on the sidelines of Coaltrans on the Indonesian island of Bali.

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