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Coal Mine can be acquired in Indonesia on Joint Venture basis with Mine owner, whereby mine owner authorizes investor to mine and sell/export coal on royalty basis.
Stage wise process is mentioned below for the convenience of investor.
Visit Jakarta, and meet mine owner/representative. Discuss various aspect of deal and agree on royalty (and other payment if any). Visit mine site and confirm information provided by mine owner. Sign MOU with mine owner. Seek about 2-3 month’s time to sign JV agreement.
Appoint law firm to do due diligence on mine owner. Report should be available in 2-3 week’s time. Cost shall be about US$ 30000/-
Appoint Drilling company to do drilling & coring to determine quality and approximate deposit. The costs shall be US$ 20000 to 25000/-
If report of above turns out well, appoint another law firm to form a Foreign Direct Investment Company. In this company, there must be an Indonesian person as partner / director. This person may hold 0% shares in the company. All 100% shares can be held by foreigner. This will take about 12-14 weeks. The cost shall be about US$ 20000/-
After FDI company is formed, enter in to Joint venture agreement with mine owner. Make payment (if any)as per MOU.
Immediately there after investor needs to apply for mining licenses from local government. Licenses shall be in the name of mine owner. There are 2 types of licenses ( consisting of 6 types of mining licenses and 2 other licenses ). This will take 12-16 weeks. The cost shall be approximately US$ Two Millions depending on mine location, payable to local government.
After these licenses are issued, mining can be immediately started.
These are basic stages of starting mining operation in Indonesia.
Important factors in selecting mine shall be following:
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Mine area in Hectares.
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GCV of Coal
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Total expected deposit
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Royalty expected
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Distance of mine from river.
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Availability of road from mine to river.
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Availability of jetty.
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Distance of Mother Vessel anchorage point in high sea to jetty.
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Status of License.
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Location of mine.
We assist investors in acquiring Coal & Gold Mine in Indonesia.