Indonesia: Export of nickel ore and other minerals

We have been advised by local correspondents that, following the implementation of the new regulation on 6th May, loading on some vessels in some locations is being suspended by customs authorities, the holds are being sealed, and the vessels prevented from sailing.

Based on advice obtained by correspondents from Customs, it is reported that:

• All vessels that have already completed loading are allowed to sail leaving Indonesia.
• All vessels that have not completed loading, are not allowed to continue loading. Only vessels that have already arranged for an Export Notification Letter (PEB) with Customs before 6 May 2012 are allowed to sail leaving Indonesia.
• Partially loaded vessels that do not have an Export Notification Letter (PEB) issued by the authorities are not permitted to sail unless cargo already onboard is discharged.
• The situation remains confused as apparently some vessels are being permitted to continue loading.
• Spica Jakarta’s advice to date has been to urge Members who are in a position to sail, to do so, as there appears to be no clear direction as to what will happen with partially loaded vessels, but the likelihood is that the cargo will have to be discharged. This is a lengthy and expensive operation.

Shipowner Members with vessels en route to load nickel ore at Indonesian ports should check with charterers that all necessary permits are in place to load the cargo and sail from the load port.

Charterer members should check with shippers, or up the chartering chain, that shippers have arranged for the necessary export licences.

Further updates will be issued as the situation becomes clearer.

Please do not hesitate to contact us should you have any questions.

May 4th 2012

Local correspondents have notified the Club that Indonesian authorities intend to enforce the provisions of Ministry Regulation No. 7/2012: Improvement of added value of minerals through mineral processing and purification activities, from 6 May 2012.

The Ministry of Energy and Mineral Resources regulation applies to mining companies that export 14 unprocessed minerals including Nickel Ore, Bauxite, Iron Ore, Iron Sand and Copper. Companies are required to apply to the Ministry for a permit to export, which will be provided on the submission of plans to develop processing facilities by 2014. It is expected the Ministry will levy an additional tax on companies licensed by the authorities and prohibit unlicensed mines from exporting any of the listed minerals.

Please click here for a copy of the new regulation.

We are waiting for clarification on the consequences of this regulation for vessels that load cargo mined at unlicensed facilities and will provide further information when it becomes available.

In the meantime Members with vessels due to load unprocessed Indonesian ores listed in the regulation are advised to contact the shipper, their local agents and /or P&I correspondents to determine whether the cargo they are fixed to load has been mined from a compliant facility.

Please contact Loss Prevention for more information.