Sat 23 Aug 2025, 09:54 AM
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The Ministry of Energy and Mineral Resources (ESDM) has permitted businesses to sell mineral and coal commodities below the mineral benchmark price (HPM) and coal benchmark price (HPB).
This provision is stipulated in ESDM Ministerial Decree (Kepmen) Number 268.K/MB.01/MEM.B/2025, signed on August 8, 2025. This policy revokes ESDM Ministerial Decree Number 72.K/MB.01/MEM.B/2025.
ESDM Ministerial Decree Number 72.K/MB.01/MEM.B/2025 regulates the obligations for IUP/IUPK holders in the production operation stage, IUPK holders as a continuation of contract/agreement operations including work contract holders and PKP2B holders, to sell metal minerals and coal produced according to the mineral benchmark price (HPM) or coal benchmark price (HPB).
The HPB, calculated using the coal reference price (HBA), serves as the lower limit for coal sales. Similarly, the HPM serves as the lower limit for metal mineral sales.
Meanwhile, in ESDM Ministerial Decree Number 268.K/MB.01/MEM.B/2025, a clause was added regarding the provisions for the use of HPM and HPB as a reference for mineral and coal sales transactions.
In this new policy, the Ministry of Energy and Mineral Resources provides an exception for all holders of Mining Business Permits (IUP), Special Mining Business Permits (IUPK), Contracts of Work (KK), and Coal Mining Business Work Agreements (PKP2B) selling minerals and coal below the HPM and HPB.
The exception applies to mining companies that previously had sales contracts with prices below the HPM or HPB.
"In the case of IUP holders in the production operation stage, IUPK holders in the production operation stage, and IUPK holders as a continuation of contract/agreement operations, including holders of work contracts and holders of coal mining business work agreements, selling metal minerals or coal based on contracts below the HPM or HPB," reads point four in the policy quoted Friday (22/8/2025).
However, mining companies that sell commodities below the HPM or HPB are still required to pay tax and royalty calculations with reference to the HPM and HPB.
"The HPM and HPB remain used in calculating tax obligations and serve as the base price for imposing production fees (royalties)".
In the same regulation, the Ministry of Energy and Mineral Resources explains that the HPM and HPB are the benchmarks for the lower selling price of metal minerals and coal.
This minimum price setting prevents undervaluation or transfer pricing practices that could erode potential state revenue.
In the decree's appendix, the government details the pricing formula for various types of metal minerals, including nickel, cobalt, copper, gold, bauxite, and coal with various calorie specifications.
This policy is a follow-up to mineral and coal mining regulations that mandate transparency in selling prices and certainty in the calculation basis for taxes and production fees.
With an official price standard, the state can still collect optimal revenue without relying on price agreements between miners and buyers.