Editing Economy of Indonesia (section)

====Oil and mining{{anchor|Mining}}====
{{see also|List of countries by coal production}}
[[File:Batu Hijau mine ore trucks.jpg|thumb|right|Ore trucks in the mining area in [[West Sumbawa]], [[West Nusa Tenggara]].]]
[[File:Grasberg mine.jpg|thumb|right|The [[Grasberg mine]] has one of the largest reserves of gold and copper in the world. It is located in [[Mimika Regency]], [[Papua (province)|Papua]], Indonesia near [[Puncak Jaya]], the highest mountain in the country.]]
Indonesia was the only South East Asian member of the [[Organization of Petroleum Exporting Countries]] (OPEC) until its suspension in 2009. The country currently remains a net oil importer despite its large petroleum production industry.<ref>{{cite web |title=Member Countries |url=https://www.opec.org/opec_web/en/about_us/25.htm |website=OPEC |publisher=Organisation of Petroleum Exporting Countries}}</ref> In 1999, crude and condensate output averaged {{convert|1.5|Moilbbl|m3}} per day, and in 1998, the oil and gas sector including refining, contributed approximately 9% to GDP. As of 2005, crude oil and condensate output were {{convert|1.07|Moilbbl|m3}} per day. It indicates a substantial decline from the 1990s, due primarily to ageing oil fields and a lack of investment in oil production equipment. This decline in production has been accompanied by a substantial increase in domestic consumption, about 5.4% per year, leading to an estimated US$1.2 billion cost for importing oil in 2005. The state owns all petroleum and mineral rights. Foreign firms participate through production-sharing and work contracts. Oil and gas contractors are required to finance all exploration, production, and development costs in their contract areas and are entitled to recover operating, exploration, and development costs out of the oil and gas produced. Indonesia had previously subsidized fuel prices to keep prices low, costing US$7 billion in 2004.<ref>{{cite web|url=http://www.atimes.com/atimes/Southeast_Asia/GC10Ae04.html|archive-url=https://web.archive.org/web/20050311204959/http://www.atimes.com/atimes/Southeast_Asia/GC10Ae04.html|url-status=unfit|archive-date=11 March 2005|title=Tigers count the cost of easing fuel subsidies|work=[[Asia Times]]|date=10 March 2005|access-date=29 August 2011}}</ref> SBY has mandated a significant reduction of government subsidy of fuel prices in several stages.<ref>{{cite news|url=https://news.bbc.co.uk/2/hi/business/4200100.stm|work=[[BBC News]]|title=Indonesia plans to slash fuel aid|date=31 August 2005}}</ref> The government has stated that cuts in subsidies are aimed at reducing the budget deficit to 1% of GDP in 2005, down from around 1.6% last year. At the same time, the government has offered one-time subsidies for qualified citizens, to alleviate hardships.

Indonesia is the world's largest tin market. Although mineral production traditionally centered on bauxite, silver, and tin, it is expanding its copper, nickel, gold, and coal output for export markets. In mid-1993, the [[Ministry of Energy and Mineral Resources|Department of Mines and Energy]] reopened the coal sector to foreign investment, resulting in a joint venture between Indonesian coal producer and [[BP]] and [[Rio Tinto (corporation)|Rio Tinto]]. Total coal production reached 74 million metric tons in 1999, including exports of 55 million tons, and in 2011, production was 353 million. As of 2014, Indonesia is the third-largest producer with a total output of 458 Mt and export of 382 Mt.<ref>{{Cite web|title=Coal Mining in Indonesia - Indonesian Coal Industry {{!}} Indonesia Investments|url=https://www.indonesia-investments.com/business/commodities/coal/item236|website=indonesia-investments.com|access-date=2020-05-06}}</ref> At this rate, the reserves will be used up in 61 years until 2075.<ref>{{Cite web |url=https://www.bp.com/content/dam/bp/pdf/energy-economics/statistical-review-2015/bp-statistical-review-of-world-energy-2015-full-report.pdf |title=Archived copy |access-date=5 January 2016 |archive-url=https://web.archive.org/web/20171115003415/https://www.bp.com/content/dam/bp/pdf/energy-economics/statistical-review-2015/bp-statistical-review-of-world-energy-2015-full-report.pdf |archive-date=15 November 2017 |url-status=dead }}</ref> Not all of the productions can be exported due to Domestic Market Obligation (DMO) regulation, which should fulfill the domestic market. In 2012, the DMO was 24.72%. Starting from 2014, no low-grade coal exports are allowed, so the [[Coal upgrading technology|upgraded brown coal]] process that cranks up the calorie value of coal from 4,500 to 6,100 kcal/kg will be built in [[South Kalimantan]] and [[South Sumatra]].<ref>{{cite web|url=http://www.thejakartapost.com/news/2011/09/23/coal-production-may-reach-370-million-tons-year.html|title=Coal production may reach 370 million tons this year|date=23 September 2011}}</ref> Indonesia is also the [[Nickel mining in Indonesia|world's largest producer of nickel]],<ref>{{cite news |last1=Sanderson |first1=Henry |title=Nickel prices hit four-year high on Indonesia export ban |url=https://www.ft.com/content/1709b318-cb26-11e9-a1f4-3669401ba76f |archive-url=https://ghostarchive.org/archive/20221210/https://www.ft.com/content/1709b318-cb26-11e9-a1f4-3669401ba76f |archive-date=10 December 2022 |url-access=subscription |access-date=9 September 2019 |work=[[Financial Times]]|date=30 August 2019}}</ref> and the second-largest producer of [[cobalt]] in 2022.<ref>{{cite news |title=Indonesia emerges as world's second-largest cobalt producer |url=https://www.ft.com/content/aae97af3-02ac-4723-a6fd-dbb0e5de55ff |access-date=10 May 2023 |work=Financial Times |date=9 May 2023}}</ref>

Two US firms operate three copper/gold mines in Indonesia, with a Canadian and British firm holding significant other investments in nickel and gold, respectively. India's fortune groups like [[Vedanta Resources]] and [[Tata Group]] also have substantial mining operations in Indonesia. In 1998, the value of Indonesian gold and copper production was $1 billion and $843 million respectively. Receipts from gold, copper, and coal accounted for 84% of the $3 billion earned in 1998 by the mineral mining sector. With the addition of [[Alumina]] project that produces 5% of the world's alumina production, Indonesia would be the world's second-largest Alumina producer. The project will not make the ores to become aluminum, as there are 100 types of Alumina derivatives that can be developed further by other companies in Indonesia.<ref>{{cite web|url=http://www.antaranews.com/en/news/70198/ri-aims-to-be-second-largest-alumina-producer|title=RI aims to be second largest alumina producer|publisher=[[Antara (news agency)|Antara]]|date=12 April 2011|access-date=29 August 2011}}</ref>

[[Joko Widodo]]'s administration continued the [[resource nationalism]] policy of SBY, nationalizing some assets controlled by multinational companies such as [[Freeport McMoRan]], [[TotalEnergies]] and [[Chevron Corporation|Chevron]]. In 2018, in a move aimed to cut imports, oil companies operating in Indonesia were ordered to sell their crude oil to state-owned [[Pertamina]].<ref>{{cite news|title=Economic nationalism is back in Indonesia as election approaches|url=https://www.straitstimes.com/asia/se-asia/economic-nationalism-is-back-in-indonesia-as-election-approaches|access-date=18 September 2018|work=[[Straits Times]]|date=17 September 2018}}</ref>