(recasts, adds quotes from industry assoc)
By Wilda Asmarini
JAKARTA Oct 7 Indonesia could export up to 15
million tonnes of nickel ore in 2017 if it amends a ban on
unprocessed ore exports, a mining ministry official said on
Indonesia banned metal ore exports in early 2014 to
encourage miners to build smelters to create jobs and shift
exports from raw materials to higher-value finished metals.
Indonesia's nickel ore exports had increased sharply before the
ban was implemented, hitting about 60 million tonnes in 2013.
But the ban cost Indonesia - once the world's top nickel ore
exporter and a major supplier of bauxite for aluminium -
billions of dollars in lost revenue.
To get smelters built, though, these rules now need to be
changed again, said Teguh Pamudji, secretary general at the
Energy and Mineral Resources Ministry, amid ongoing discussions
of a mining policy shift.
Under the proposed changes, nickel and bauxite mine permit
holders that have committed to building smelters would be
allowed to export minerals, he said.
The government has also proposed allowing miners of copper,
zinc, lead, manganese and iron to continue to export
concentrates until 2022, provided they are building smelters,
The proposed changes would provide a way around a 2017
deadline for full domestic processing, where "only seven" of up
to 27 smelter projects were almost complete, Pamudji said.
"The rest (of the smelters) are only 30 percent or 50
percent completed - that's why the government would give them
more time," Pamudji said.
Exports of unprocessed rare earth metals were also being
considered, he said.
The proposed changes could be a breakthrough for miners such
as U.S. giant Freeport-McMoRan Inc.
But many in Indonesia's newly budding smelter industry say
changing the rules would do more harm than good for Southeast
Asia's largest economy, possibly undermining metal prices and
putting up to $12 billion in investments at risk.
Nickel prices would "collapse" if the proposal to lift the
ban is carried out, Jonatan Handojo, Executive Director of
Indonesia's main smelter association, told Reuters by phone.
Handojo said "nickel prices go down straight away" whenever
the government says it is considering allowing exports, and
prices could sink below $9,000 per tonne if the ban is lifted.
London benchmark nickel prices have retreated from a
seven-week high hit last week, and are currently at around
$10,250 a tonne.
(Reporting by Wilda Asmarini; Writing by Fergus Jensen; Editing
by Tom Hogue)