INDONESIA METAL MINING INDUSTRY PROFILE

In 2005, nickel mining industry woke up from slump development in 2003-2004. As until now, no other investor interested in copper mining in Indonesia, the futures of copper mining will depend on the operational activities of PT Freeport and PT Newmont, which have large recoverable reserves, enough for around 20 years. As already occurred in the last 5 years, copper price is expected to continue rising as already started in 2005, related to the rising copper consumption by China. Copper production in Indonesia is expected to increase by an average annual rate of 2.0% in coming 5 years from 1.09 million tons in 2006 to 1.18 million tons in 2020.

Until now, PT Freeport Indonesia and PT Newmont Nusa Tenggara will remain the only two copper mining companies in Indonesia marked by Grasberg and Batu Hijau copper mines. Grasberg is reported as one of the largest copper mine in the world. The two companies are producing porphyry copper ore containing gold and silver.

Gold mining industry in Indonesia has actually very promising prospect with regard to the huge resources available in West, Central and East Kalimantan.

In West Kalimantan there is a village called Beringin in Singkawang Regency have 35 million tons of alluvial placer gold containing 169 mg of gold per cu.m.

In Central Kalimantan, there are a lot more villages having huge gold ore deposits, which include:

1. Village Tumbang Liling (42 million tons deposit of 280 mg of gold per cu.m)
2. Village Cempaka Buang (15 million tons deposit of 300 mg of gold per cu.m)
3. Village Tewang Tampang (24 million tons deposit of 220 mg of gold per cu.m)
4. Village Batuah (31.3 million tons deposit of 268 mg of gold per cu.m)
5. Village Baamang Tengah (30 million tons deposit of 184 mg of gold per cu.m)

All of the villages are in Waringin Timur Regency, Central Kalimantan.

In East Kalimantan, there is a village called Muara Asa recorded of having a total gold ore deposit of 300 million tons containing 400 mg of gold per cu.m.

There are many other villages having adequate amount of gold ores, including those located in Banten Province, and West Java Province. Although not as spectacular as those in Kalimantan.

Silver production fluctuated from 255.4 tons in 2000 to 238.7 tons in 2005. Silver mining in Indonesia is combining with gold mining, highly notable silver ore deposits are found in Dairi - North Sumatera, Kelapa Kampit – Belitung, and in Papua (Kucing Liar, Grasberg Deep, Big Gossan and DOM).

Nickel production in term of Ni+Co in matte produced by PT Inco increased from 55,589 tons in 2000 to 77,471 tons in 2005 with an average growth rate of 10.7% per year. PT Aneka Tambang (Antam) produced 10,111 tons of Ni in FeNi in 2000 then gradually dropped to 7,945 tons in 2010 with an annual growth rate of (-13.6%).

Tin metal is produced by PT Timah and PT Koba Tin, which increased from 47,129 tons in 2000 to 67,600 tons in 2005 with an annual growth rate of 8.1%. Tin mining prospect will still expected to be in Bangka-Belitung province, particularly in Simpang Rusa and Koba, which are in the mining areas of PT Timah and PT Koba Tin.

Bauxite production grows slowly in 2000 – 2005 due mainly to some depletion of PT Antam’s bauxite recoverable deposits. Bauxite production was 1,151 thousand tons in 2000 then fluctuated to drop to 1,082 thousand tons in 2005 with annual growth rate of (-0.7%) per year. The future of bauxite mining will be in Riau island, including Pualu Bintan (101 million tons) and Kampung Bugis (1,332 million tons), which are in PT Timah’s mining areas. There are also huge bauxite deposits in West Kalimantan with total 2,368 million tons deposits, but nothing done until now to exploit the deposit, yet. They are located in the villages of Balai Tinggi (54 million tons), Kendawang Kanan (532 million tons), Baru Lombang (198 million tons), Tanjung Batu Belati (1,146 million tons), Menyumbang (200 million tons), and Menukung village (238 million tons).

Iron sand production is produced by PT Antam at a very discouraging development, producing only 489 thousand tons in 2000 then decline to only 26 thousand tons in 2005, despite abundant recoverable reserves is available. Iron sand deposit is plentiful in South Kalimantan, especially in Batu Licin (125 million tons) and Sebuku Islands (626 million tons).

In order to decrease the dependence on raw material import, PT Krakatau Steel, the only integrated steel industry in Indonesia, plans to set up new palletizing plant in South Kalimantan. The plant will use iron ores from South Kalimantan and West Kalimantan. In the first stage, PT KS will build sponge iron plant with a production capacity of 300,000 tons per year, and will be expanded to around 4 million tons per year. Government also encourages the mining companies to support PT KS’s plant and develop the iron mining in Kalimantan.


LIST OF CONTACTS


PT. FREEPORT INDONESIA
Address:
Plaza 89 Building, 5th Floor
Jl. HR. Rasuna Said Kav. X-7 No. 6, Kuningan,
Jakarta Selatan 12940, INDONESIA
Website: http://www.ptfi.co.id/

PT. NEWMONT NUSA TENGGARA
Address:
Menara Rajawali Building, 26th Floor
Jl. Mega Kuningan Lot f 5.1,
Jakarta Selatan 12950, INDONESIA
Website: http://www.newmont.co.id/

PT. INTERNATIONAL NICKEL INDONESIA (INCO)
Address:
Plaza Bapindo Building Citibank Tower, 22nd Floor
Jl. Jend. Sudirman Kav. 54-55,
Jakarta Selatan 12190, INDONESIA
Website:

PT. ANEKA TAMBANG TBK.
Address:
Jl. Pemuda Ujung-Raya Bekasi Km. 18, Pulogadung,
Jakarta Timur 13210, INDONESIA
Website: http://www.antam.com/

PT. TIMAH TBK.
Address:
Jl. Jend. Sudirman No. 51,
Pangkal Pinang 33121
Bangka Belitung, INDONESIA
Website: http://www.timah.com/

PT. KOBA TIN
Address:
Arthaloka Building, 12th Floor
Jl. Jend. Sudirman Kav. 2,
Jakarta Pusat 10220, INDONESIA
Website: http://www.ptkoba.co.id/

PT. KRAKATAU STEEL
Address:
ADB Building
Jl. Industri No. 5, Cilegon 42435, INDONESIA
Website: http://www.krakatausteel.com/