Minister of Energy and Mineral Resources Regulation No. 12 of 2026 Reshapes the Rules Governing WIUP, Priority WIUPK, and Community Mining

Introduction

On 8 October 2026, the Minister of Energy and Mineral Resources (“ESDM”) issued Minister of Energy and Mineral Resources Regulation No. 12 of 2026 on Amendments to Minister of Energy and Mineral Resources Regulation No. 18 of 2025 on Implementing Regulations for Government Regulation No. 39 of 2025 on the Second Amendment to Government Regulation No. 96 of 2021 on the Implementation of Mineral and Coal Mining Business Activities (“ESDM Regulation 12/2026”), which took effect on 13 October 2026. ESDM Regulation 12/2026 introduces amendments governing adjustments to the mechanisms for granting Community Mining Areas (Wilayah Pertambangan Rakyat or “WPR”), Mining Business License Areas (Wilayah Izin Usaha Pertambangan or “WIUP”) through priority allocation, and Special Mining Business License Areas (Wilayah Izin Usaha Pertambangan Khusus or “WIUPK”) through priority allocation.

Comparison

ESDM Regulation 12/2026 amends several provisions of ESDM Regulation 18/2025, including adjustments to, insertions into, and deletions of a number of provisions and appendices, as described in the following table:

Key Provisions

Determination and Sources of WIUP and WIUPK

Article 2 paragraph (3) stipulates that WIUPs for metallic minerals, coal, non-metallic minerals, certain types of non-metallic minerals, and rocks originate from:

• the results of mineral and coal exploration and research activities;

• the results of evaluations of WIUPs for metallic minerals or coal that have been relinquished or reduced in area by IUP holders;

• the results of evaluations of WIUPs for metallic minerals or coal for which the IUPs have expired or been revoked;

• the results of evaluations of former contract/agreement areas;

• the results of exploration and research conducted by Business Entities Receiving Assignments for the purpose of preparing WIUPs;

• proposals from governors; and/or

• other areas with geological potential for minerals and coal.

Article 2 paragraphs (4) and (5) affirm that WIUPs for metallic minerals and coal are determined by the Minister and subsequently obtained through an auction or priority-based allocation. Meanwhile, WIUPs for non-metallic minerals, certain types of non-metallic minerals, and rocks are obtained through an application for an area in accordance with the provisions of laws and regulations, as stipulated in Article 2 paragraph (6). The same approach applies to WIUPKs for metallic minerals and coal pursuant to Article 38 paragraphs (2) through (4).

Considerations for Priority-Based Allocation of Areas

Article 19A paragraph (1) stipulates that priority-based allocation of WIUPs must take into account the distribution of geological potential, as indicated by the potential presence of metallic minerals and/or coal, the economic benefits to the community, and the creation of local employment opportunities. Article 19A paragraph (2) adds optional considerations, namely the proximity of resource areas or zones to communities and/or increased added value/downstream processing.

Meanwhile, Article 39A paragraph (1) provides that priority-based allocation of WIUPKs must take into account the distribution of geological potential, the proximity of resource areas or zones to communities, the economic benefits to the community, and the creation of local employment opportunities. Unlike the provisions governing WIUPs, the provisions governing WIUPKs do not specifically include increased added value/downstream processing as an additional consideration. Priority-based allocation of WIUPs and WIUPKs must be carried out objectively, transparently, and accountably, as stipulated in Article 19A paragraph (3) and Article 39A paragraph (2), respectively. In addition, information regarding plans for priority-based allocation of WIUPs and WIUPKs must be published on the Ministry's official website, pursuant to Article 19A paragraph (4) and Article 39A paragraph (3).

Verification of Applications for Priority-Based WIUP and WIUPK Allocation

Article 29 paragraph (1) provides that applications for priority-based allocation of WIUPs for metallic minerals or coal must be verified through the Ministry's official channels and the OSS System. Such verification is carried out in accordance with the provisions of laws and regulations governing the implementation of risk-based business licensing and the conduct of mineral and coal mining activities, as stipulated in Article 29 paragraph (2). Article 29 paragraph (3) further provides for administrative verification by the relevant minister, taking into account the economic benefits to the community, the creation of local employment opportunities, and the proximity of resource areas or zones to communities. Such administrative verification is carried out through the risk-based business licensing mechanism within the OSS System no later than 14 (fourteen) calendar days from the date the application is submitted. If this period expires without a decision on the outcome of the administrative verification, the Minister is authorized to determine which applications will undergo further verification; accordingly, the delay does not automatically result in approval of the application.

Meanwhile, Article 47 paragraphs (1) and (2) provide that applications for priority-based allocation of WIUPKs for metallic minerals or coal must be verified through the OSS System in accordance with the provisions of laws and regulations governing the conduct of mineral and coal mining activities and the implementation of risk-based business licensing, without specifying the administrative verification stage or the 14-calendar-day time limit applicable to WIUPs under Article 29.

Removal of Technical Guidelines from the Appendices

Article I numbers 4, 8, 14, and 15 repeal Article 33, Article 51, Appendix II, and Appendix IV letter A. These two appendices set out a four-stage procedure that is no longer part of Minister of Energy and Mineral Resources Regulation No. 18 of 2025 (Permen ESDM 18/2025):

- Determination of the allocation plan in a Ministerial Decree (maps, coordinates, geoscientific reports, and allocation plans), which may be announced together with the application submission period;

- Submission of an application through the OSS System, accompanied by the required documents, a list of coordinates, the commodity, area size, location, and a declaration that the applicant does not hold any other mining licenses (except for state-owned enterprises);

- Evaluation and verification in accordance with the regulations governing minerals and coal and risk-based licensing; and

- Approval or rejection within 14 working days, together with an instruction to pay compensation for information data and place an exploration guarantee (each within 7 working days), and to apply for an Exploration IUP/IUPK (within 10 working days); failure to comply results in the recipient being deemed to have withdrawn, and the area reverting to the State.

Nevertheless, the principal substance governing the mechanisms for priority-based allocation of WIUPs and WIUPKs remains regulated in the unchanged main body of the regulation, including Article 20, Article 28, and Articles 30 through 32. The repeal primarily affects the technical guidelines previously detailed in the appendices, including the format of the Ministerial Decree determining the allocation plan and the list of documents required to be uploaded through the OSS System. Meanwhile, Appendix I, Appendix III, and Appendix IV letter B, which govern offers to state-owned enterprises (BUMN) and regional-owned enterprises (BUMD) as referred to in Article 55 paragraph (2), remain in force.

WPR Proposals and WPR Management Documents

Article 73 paragraph (2) provides that a governor's proposal for a WPR must take into account the results of the evaluation of the established Mining Areas (WP), environmental carrying capacity and sustainability, spatial planning compatibility, and the types of mineral reserves that meet the depth and location criteria. Article 73 paragraph (3) also permits WPR proposals for areas where communities have already conducted mining activities without permits. Proposals are limited to a maximum of 100 hectares per block, and the Minister determines the WPR based on an evaluation of compliance with the applicable requirements.

Pursuant to Article 74, following the determination of a WPR, the governor prepares a management document for one or more blocks containing coordinates and maps, rock, soil, and water conditions, mining, processing, and refining plans, production costs, safety and environmental management measures, and guidelines for imposing people's mining levies. The document is evaluated and determined by the Minister (paragraphs (1) through (3)).

Issuance of IPRs and the Responsibilities of Governors

Article 75 paragraphs (1) through (3) provide that the governor issues an IPR after the WPR management document has been determined, with a maximum area of 5 hectares for individuals and 10 hectares for cooperatives, and require a Business Identification Number (NIB) in the mining sector. Before an IPR is issued, the provincial Regional Government must:

1. prepare and determine reclamation and post-mining plans for each WPR block;

2. announce the division of coordinate blocks and conduct outreach to regional government agencies and affected communities; and

3. facilitate spatial conformity approval and environmental approval.

Following the issuance of an IPR, the governor is responsible for mining safety, environmental management, reclamation, and post-mining activities, including through guidance, supervision, and improvements to governance. The governor may also appoint a state-owned enterprise (BUMN), a regional-owned enterprise (BUMD), or a private business entity to carry out processing and refining. In addition, Article 76A assigns the governor the task of facilitating approval for the use of forest areas and technical recommendations concerning water resources after an IPR has been issued. Unlike the previous provisions, Article 76 no longer stipulates an obligation to provide a reclamation guarantee amounting to 10% of each mineral sale; therefore, the legal basis for such an obligation needs to be identified in other applicable provisions.

Closing 

Minister of Energy and Mineral Resources Regulation No. 12 of 2026 (Permen ESDM 12/2026) amends the mechanisms for priority-based allocation of WIUPs and WIUPKs, strengthens the verification process through the OSS System, and revises the requirements for proposing WPRs, issuing IPRs, and establishing the responsibilities of governors. The repeal of certain provisions and appendices also changes the technical references previously used in the process of allocating mining areas.

In implementing these provisions, business entities must pay attention to the criteria for priority-based area allocation, the verification requirements and time limits, and the obligations applicable before and after the issuance of an IPR. Regional governments must also adjust the exercise of their respective authorities, particularly with regard to WPR management and the supervision of people's mining activities.