Home Blog Discovering the Future of the Coal Mining Industry in Java Business Licenses | Environmental Permit | Semarang Discovering the Future of the Coal Mining Industry in Java InCorp Editorial Team 24 June 2025 6 minutes reading time Table of Contents Why Starting A Coal Mining Business in Java? The Advantages of Coal Coal Mining Potential in Java 8 Tips on How to Start a Successful Coal Mining Company in Java How Do You Start A Coal Mining Company in Java? Unlock Coal Mining Potential in Java with InCorp People often find the well-known coal mining landscape outside Java Island in Indonesia. However, the government is now looking inside Java to ensure the industry’s future. Indonesian coal mining on Java Island holds significant promise for economic growth and energy development. With abundant coal reserves awaiting extraction, Java is a pivotal region in Indonesia’s coal mining landscape. Why Starting A Coal Mining Business in Java? Indonesian Statistics (BPS) data indicates that Java Island still contributed the largest share of Indonesia’s economic growth in 2023. It accounted for 57.05% of the 2023 GDP, followed by Sumatra Island at 22.01%. Meanwhile, economic growth on Java Island in 2023 reached 4.96%, while Sumatra Island recorded a growth rate of 4.69%, below the national average economic growth rate. Moreover, Java is also one of the largest regions in Indonesia in terms of coal production capacity, despite being smaller than the potential in the Kalimantan and Sumatra Islands. In 2020, Java Island had 58.5 million tons of coal resources, with reserves amounting to 7.23 million tons. This number indicates the potential of a coal mining industry in Java. The Advantages of Coal Despite the ongoing energy transition, coal benefits our country and citizens significantly. According to Irwandy Arif, from the Minister of Energy and Mineral Resources, some of these advantages include Affordable and Reliable Energy Sources Coal remains one of the cheapest and most reliable sources of energy. Coal-fired power plants still power all electricity sources in Java Island. Indonesia’s coal wealth, estimated at USD 4 trillion, comprises two-thirds of the country’s total mineral and coal mining wealth. National Economic Resource Revenue from coal mining for the country in 2021 amounted to USD 47 billion, or around IDR 733.9 trillion. According to data from the Ministry of Energy and Mineral Resources, Non-Tax State Revenue (PNBP) from the mineral and coal mining sector in 2023 reached IDR 173 trillion, surpassing the 2023 target of IDR 146.1 trillion. The PNBP target for the mineral and coal mining sector 2024 is “only” IDR 113.5 trillion. Coal contributes about 70% of this estimated wealth. Downstream Potential Coal’s downstream potential is still highly feasible, which can increase the added value of domestic coal production. Indonesia’s coal mining resources reach 99.19 billion tons with total reserves of 35.02 billion tons. Therefore, coal can remain Indonesia’s primary energy source for 20 years. READ MORE:Sumatra’s Mining Industry: A Promising FutureThe Future of the Coal Power Plant Business in IndonesiaEV Growth Opens Opportunities in the Mining Industry Coal Mining Potential in Java Java Island has a vast potential for coal mining, with reserves reaching 58.5 million tons and production at 7.23 million tons. Several areas on Java Island have coal potential, including: Banten: Pandeglang, Lebak, and Bayah. This area has bituminous coal, widely used for coal-fired power plants (PLTU), and lignite coal, commonly used for PLTU and industrial combustion. West Java: Bogor, Sukabumi, Garut, Purwakarta, Cianjur, and Cirebon. This region has both bituminous and lignite coal, which are extensively used for PLTU and industrial combustion. It also has peat coal, primarily for hydroelectric power plants (PLTA). Central Java: Wonogiri, Cilacap, Kebumen, and Banjarnegara. Bituminous and lignite coal are predominantly utilized for PLTU and industrial combustion. Additionally, it has peat coal for PLTA. Yogyakarta: Kulon Progo Regency. Bituminous and lignite coal in this area are widely used for PLTU and industrial combustion. East Java: Lumajang, Malang, Jember, Banyuwangi, and Pacitan. This region boasts bituminous, lignite, peat, and natural gas coal. 8 Tips on How to Start a Successful Coal Mining Company in Java Establishing a coal mining company can be challenging, but it can also be advantageous. Here are some tips to help you start. How Do You Start A Coal Mining Company in Java? There are several aspects to consider for a company that aims to establish mining facilities in Java. Those are: Permits and Regulations Various types of mining licenses are applicable in Indonesia: Permit TypesDescriptionsExploration Mining Business License (IUP)Permits are necessary for conducting general investigation, exploration, and feasibility studies. The validity period must be taken seriously. It ranges from three years for non-metallic minerals to seven years for coal and specific non-metallic minerals and up to eight years for metallic minerals.Exploration Special Mining Business License (IUPK)Similar to the IUP but granted directly by the Ministry.Production Operation Mining Business License (IUP)Issued after the Exploration Mining Business License (IUP) for conducting production activities like construction, mining, processing, and sales transportation.Production Operation Special Mining Business License (IUPK)Similar to the IUP but issued directly by the Ministry instead of the local government.Mining Business License for Special Production Operation for Processing and/or PurificationValid for 30 years and extendable every 20 years, this permit enables buying, transporting, processing, and refining activities.Mining Business License for Special Production Operations for Transport and SalesPermits for buying, transporting, and selling mineral or coal mining commodities are valid for up to 5 years and extendable every five years. Regulations are issued either by the Governor or the Ministry depending on the operational area’s coverage.Mining Service Business License (IUJP)The IUJP is authorized to conduct essential mining service operations covering all phases and aspects of mining activities. Its initial validity is five years, extendable in increments of 5 years. The Governor grants authorization within the province, while outside the province, it is issued by the Ministry. Infrastructure Development When applying for mining business permits, you must provide information on the type, quantity, condition, and location of the equipment used, particularly for mining and construction activities. If your company does not own equipment, then you only need to inform them about the ownership of such equipment. Technology and Manpower Every company engaged in mining activities must have a human resources organizational structure including: The head of the mining inspectorate recognizes, and the head of mining engineering approves an operational supervisor (PJO) with competence in operational supervision or certification/qualification. Experts with expertise relevant to the type, field, and sub-field of business, as evidenced by competency certificates. Community Engagement Businesses prioritizing public feedback showcase their sustainability and commitment to social responsibility. An open communication channel fosters trust and strengthens their bond. Mining companies must ensure a transparent, accessible, and effective complaint resolution system. Guide to Doing Business in Semarang Mailchimp Free eBook Semarang Contact Full NameEmail I have read InCorp's Privacy Policy and agree to InCorp using my information provided to contact me about related content, and services.*Download Unlock Coal Mining Potential in Java with InCorp Java Island boasts vast potential for coal mining, but initiating operations in this sector demands considerable time and effort. Given the environmental impact of coal mining activities, securing the necessary environmental permits is crucial to meeting regulatory standards, and InCorp Indonesia (an Ascentium Company) is equipped to assist you in this regard. Our comprehensive offerings encompass obtaining essential business licenses and environmental permits, ensuring full compliance with legal and environmental standards. Contact us for further information and assistance in realizing your mining ambitions by completing the form below. Read Full Bio Verified by Hotdo Nauli Senior Legal & Delivery Manager at InCorp Indonesia Hotdo heads the Legal and Delivery team at InCorp Indonesia, managing Product Registration, Legal Advisory, and Business Licensing. With over 8 years of experience, she focuses on compliance and integrity, ensuring all client operations align with Indonesian laws and regulatory standards, including contract reviews and sector-specific licenses. She is also a licensed advocate and a member of the Indonesian Advocates Association (PERADI). Frequently Asked Questions What if my product has been registered under a local distributor, and I decide to transfer the license to my company or another distributor? You can transfer the license if your local distributor agrees to change the product license holder. What kind of license does a PMA company need to get? In Indonesia, the licensing system has been updated with the implementation of the Omnibus Law. Businesses are categorized into four risk levels based on the PMA company classification. Licensing requirements vary accordingly, with three main types: Business Identification Number (NIB) Low-risk businesses needing only an NIB Standard Certification Standard Certification is necessary for medium-low and medium-high-risk businesses Licenses/Permits High-risk businesses require licenses/permits Additionally, basic requirements, including business location, must be met. Many licensing processes are facilitated through the Online Single Submission (OSS) platform managed by the Investment Coordinating Board (BKPM). How A PMA company can be eligible to conduct import activities? What licenses and procedures are necessary while engaging in import-related activities? A PMA company in Indonesia must obtain an NIB, which also functions as: Importer Identification Number (Angka Pengenal Impor or API) Producer Importer Identification Number (Angka Pengenal Impor Produsen or API-P), which is required for the import of machinery and equipment, goods, and materials used in production. General Importer Identification Number (Angka Pengenal Impor Umum or API-U), which is required for the import of specific goods for trading purposes, is grouped under one section in the Customs Classification System. Customs Identification Number (Nomor Identitas Kepabeanan or NIK), It functions as an identifying document for the applicable Customs and Excise authorities during the customs clearance process. Some goods may face limitations or restrictions on importation in Indonesia, potentially requiring additional approval from the Ministry of Trade. Recommendations from technical ministries like Industry or Agriculture may influence these approvals. Get in touch with us. 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