Jakarta – The government has abolished the bank guarantee scheme as a form of mining reclamation guarantee and now only requires guarantees in the form of time deposits. According to the Ministry of Energy and Mineral Resources (MEMR), last weekend, the change in regulations was stipulated in MEMR Ministerial Decree No. 344 of 2025.
The Coordinator of Mineral and Coal Environmental Protection at the Ministry of Energy and Mineral Resources, Horas Pasaribu, explained that “under the new regulations, the only form of guarantee is a time deposit. Bank guarantees are no longer accepted,” Horas stated emphatically during a discussion titled “Uncovering ESG Transformation in Indonesia’s Nickel Mining Industry.”
This regulation tightens the management of reclamation guarantees. Mining companies are required to deposit funds in the form of time deposits to obtain approval for their Work Plans and Budget Estimates (RKAB). This policy is intended to ensure that post-mining environmental restoration is no longer neglected by business operators.
The funds deposited are managed directly by the government as a guarantee for reclamation during the mining operation period. Through this scheme, the government has full control over the guarantee funds. If the company defaults on its reclamation obligations, the state will appoint a third party to carry out environmental restoration using these funds.
“The guarantee value is now set higher than the estimated reclamation costs. The aim is to give companies an incentive to complete the reclamation themselves,” explained Horas.
In addition, the government has now set a standard reclamation cost or Standard Biaya Reklamasi (SBR). The amount of the guarantee no longer depends on the company’s proposal, but is calculated based on the area of land cleared.
Horas said that the company’s funds remain secure as long as its obligations are fulfilled. “The company can withdraw the deposit once the reclamation is complete. So there is no need to worry, the funds will definitely be returned,” he said.
With these stricter regulations, the government hopes that there will be no more abandoned mines without restoration, while strengthening companies’ commitment to environmental sustainability in the mining sector. (Hartatik)
Banner photo: Image generated by OpenAI’s DALL·E via ChatGPT (2024)
