SMM Flash: Indonesian Nickel Ore Royalty Policy Sparks Controversy Over Potential Rate Reduction

Published: Apr 22, 2025 11:36

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【SMM Flash Report】April 22 – According to the PNBP policy issued by the Indonesian government on April 11, a constant royalty rate of 14% will be applied to all nickel ores. However, the implementation of this policy has sparked controversy: if low-grade nickel ore (Ni < 1.5%) meets the qualification standards for raw materials used in electric vehicle batteries, there is speculation as to whether the applicable royalty rate could be reduced to 2%. The Indonesian National Economic Council has confirmed that, as of now, no mining company in the country holds an IUP (Mining Business License) that meets the exemption criteria. This indicates that the clause currently lacks the basis for implementation within Indonesia.

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