An Indonesian task force has seized plots spanning hundreds of acres from miners PT Weda Bay Nickel and PT Tonia Mitra Sejahtera for lack of relevant forestry permits, officials said on Friday.
The world’s largest producer of nickel products is cracking down on illegal exploitation of natural resources, with President Prabowo Subianto saying last week that more than 1,000 such mining operations were identified.
The crackdown boosted nickel prices, with benchmark three-month nickel on the London Metal Exchange up 1.32% at $15,350 a metric ton by 0801 GMT.
The most-traded contract on the Shanghai Futures Exchange closed daytime trade up 1.28% at 121,800 yuan a ton.
A 148-hectare (366-acre) area at PT Weda Bay Nickel’s concession has been seized for the lack of a forestry licence needed to exploit the plot, mining ministry official Rilke Jeffri Huwae said.
“They have the mining permit, but they don’t have the borrow-to-use permit for the forest,” Rilke said.
Weda Bay Nickel, controlled by China’s Tsingshan Holding Group, France’s Eramet SA and Indonesia’s Aneka Tambang, spans 45,000 hectares (111,000 acres) on Indonesia’s island of Halmahera.
Weda Bay is trying to seek clarification from the task force, said a company source who sought anonymity in the absence of authorization to speak to media.
Eramet Indonesia said it was fully committed to comply with all applicable rules, while assessing the situation.
“We respect the decisions of the Indonesian authorities and fully support PT WBN in working closely with the authorities to ensure all activities undertaken meet the required legal and regulatory standards,” it said in a statement.
The seized plot was a rock quarry for construction material and did not cover the mining extraction site, Eramet said, adding that it did not expect significant impact on Weda Bay’s operation.
Images from a regional news channel showed authorities, some in military uniform, putting up a sign showing the area was now under government control. The government had closed off the area, Eramet said.
The task force has also seized an area of 173 hectares (427 acres) managed by PT Tonia Mitra Sejahtera in Southeast Sulawesi, said Febrie Adriansyah, a senior prosecutor at the attorney general’s office.
Tonia’s mining permit covers nearly 5,900 hectares (14,580 acres), ministry data showed.
The task force has identified a total of 4.2 million hectares (10 million acres), managed by 51 companies, as lacking proper forestry permits, Febrie added.
(By Bernadette Christina Munthe, Fransiska Nangoy and Amy Lv; Editing by David Stanway and Clarence Fernandez)
