ANNOUNCED AS TEMPORARYNo
The Ministry of Energy and Mineral Resources issued a new regulation (No. 34 of 2009), effective 31 December 2009, on prioritising mineral and coal resources for domestic usage. This regulation is one of the first regulations related to Indonesia's update of the mining legislation in 2009 (No. 4/2009). The regulation requires producers of coal and mineral to allocate a minimum percentage of its total production to the domestic market. This DMO percentage is to be determined by the Ministry each June and made available to mining companies prior to the year in which it will be effective.
The Regulation includes strict sanctions for failure to comply with the DMO requirement, including a cut of up to 50% in quotas for mining production (for the mining company) or trading volume (for the trading company) in any relevant year.
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