The Attorney General Office (AGO) of Indonesia has arrested the former director-general of the country’s Ministry of Mining and Coal over the alleged enabling of unlawful nickel mining in the country.

Ridwan Djamaluddin is accused of having helped grant nickel ore licences to several groups of miners in 2021. These miners then used the given approvals to mine in areas outside of their concessions, costing the Indonesian Government Rp5.7trn ($375m) in lost revenue.

This lost revenue came from alleged extraction across 157 hectares belonging to the country’s state nickel miner Aneka Tambang. The most prominent miner accused was PT Kabaena Kromit Pratama, which Djamaluddin is alleged to have met with to discuss the allowed nickel permit.

The AGO stated: “On 14 December 2021, [Ridwan Djamaluddin] chaired a limited meeting and decided to simplify aspects of the mining company’s [work plan and budget] assessment. As a result, PT Kabaena Kromit Pratama, which no longer has nickel deposits in its permit area, received an ore nickel mining quota for 2022 of 1.5m metric tons, as well as several other companies located around the Mandiodo Block.”

In reality PT Kabaena Kromit Pratama, along with several other companies, either used or sold its permit to facilitate nickel extraction on lands belonging to Aneka Tambang that did not have a nickel mining quota. The AGO added that a total of ten people are being questioned in connection with the case, including Djamaluddin.

Indonesia was the world’s largest producer of nickel in 2022, with output increasing year-on-year up to 2021, and set to rise by 4% a year further until 2026. Despite this, the country has long struggled to combat illegal mining. More than 2,000 illegal mines exist in the country. In 2020, the country banned the export of raw nickel in order to entice investment into the country’s mining industry and increase its viability as a global electric vehicle battery production hub.

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By GlobalData