Glencore’s Cerrejon shutdown deepens pressure on Colombia coal

Cecilia Jamasmie | June 2, 2026 

Cerrejon is one of the world’s largest open-pit coal mines. 

(Image courtesy of Glencore | Cerrejon.)

Glencore’s (LON: GLEN) Cerrejon mine in Colombia, one of the world’s largest open-pit coal mines, suspended mining, rail and port operations in La Guajira province earlier this week after a community blockade cut off coal shipments and fuel supplies, highlighting growing pressures on one of the country’s largest exporters.

Cerrejon declared force majeure on June 1 after protesters blocked its railway line to Puerto Bolívar, preventing the delivery of essential goods and halting coal transport. The company suspended most employment contracts while retaining workers needed for maintenance, environmental controls and other critical functions.

“We reiterate our call for constructive dialogue to bring an end to these actions, which not only affect Cerrejón’s operations but also generate negative impacts on employment, regional development, and the economic stability of La Guajira and Colombia,” the company said.

The shutdown underscores the challenges facing Colombia’s coal industry, which is grappling with declining output, community opposition, regulatory uncertainty and weakening competitiveness despite continued global demand for thermal coal.

Community demands

The blockade began May 23 and remains in place. Community leaders are demanding compliance with constitutional rulings on collective rights and prior consultation, expanded access to water, renewable energy industrialization projects, participation in energy initiatives and new mechanisms for redistributing royalties.

Cerrejón said many of the requests fall outside its responsibilities or have already been addressed through previous consultations and legal processes.

The breadth of the demands suggests the dispute extends beyond the mine itself and reflects wider tensions over development, public services and governance in La Guajira, one of Colombia’s poorest regions.

Years of disruption

The latest shutdown follows a series of disruptions that have increasingly weighed on the operation.

Cerrejón said it has faced nearly 80 blockades this year, most of them linked to protests against government authorities over the lack of basic services in nearby communities rather than disputes with the company. The miner recorded 333 blockades in 2024, equivalent to 135 days of interrupted operations. Last year it reported 201 blockades and nine terrorist attacks that disrupted coal transport for 95 days.

The company has also been navigating uncertainty surrounding a temporary 1% export tax and weakening coal markets. Cerrejón produced 16.8 million tonnes of coal in 2025, down 12% from the previous year. It also announced plans to reduce annual production by between 5 million and 10 million tonnes in response to oversupply in the Atlantic thermal coal market.

The broader sector is facing similar headwinds. Colombia’s coal production fell to 53.9 million tonnes in 2025, the lowest level in two decades, according to the National Federation of Coal Producers.

“While the world secures its energy with coal, Colombia is losing competitiveness and giving up market share,” Fenalcarbón president Carlos Cante said. “Internal factors such as the tax burden, logistics costs, and regulatory uncertainty are slowing production and investment.”

Political backdrop

The suspension comes as investors are increasingly betting on a political shift in Colombia following Sunday’s presidential election.

The peso recorded its strongest daily gain in four years while bonds and stocks rallied after right-wing outsider Abelardo de la Espriella unexpectedly won the first round of voting and emerged as the favourite heading into a June 21 runoff against leftist Ivan Cepeda.

Colombia’s 2054 dollar bonds rose more than four cents on the dollar, the peso gained 3.6% against the U.S. dollar and the benchmark stock index climbed as much as 7.1%. State-owned oil producer Ecopetrol surged nearly 10% intraday on expectations a new administration could support resource development and reverse some of President Gustavo Petro’s energy policies.

De la Espriella, who captured 43.7% of the vote, has pledged to cut taxes, restrain public spending and support business investment. Cepeda, an ally of Petro who won 40.9%, has advocated expanded social spending and opposed measures such as fracking and new oil exploration.

For miners, however, election optimism may not immediately solve the operational challenges on the ground. Cerrejón’s shutdown illustrates how community disputes, infrastructure disruptions and regulatory uncertainty continue to threaten production in one of Latin America’s most important coal-producing regions.

The company and local communities remain far apart on many of the issues driving the blockade. Even if the dispute is resolved quickly, recurring interruptions could continue to weigh on output and investment decisions across Colombia’s mining sector.

 

Asia’s coal comeback complicates energy transition across region

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By IntelliNews May 29, 2026

The war in Iran is reshaping Asia’s energy landscape and forcing governments to reconsider existing coal phase-out plans as fears grow over disruptions to LNG exports from Qatar and the continued closure of the Strait of Hormuz.

According to The Economy, countries across the region are reviving coal-fired generation to shore up electricity supplies, not least Taiwan where the government has resumed purchases of coal-fired electricity, while across the Taiwan Strait, China too is increasing investment in coal use. South Korea and Japan meanwhile are moving to ease restrictions on coal-fired power generation as governments prioritise energy security.

According to Bloomberg, Taiwan Power Co. has been purchasing coal-fired electricity from the Mailiao power plant since April. Taiwan, home to some of the world’s largest semiconductor producers, relies on LNG for around half of its electricity generation, and in 2024 about one-third of its LNG imports came from Qatar.

But with the Iran war disrupting supply chains after Qatar’s largest LNG export terminal shut down, Taiwan has struggled to secure LNG supplies through May and finalised contracts covering roughly half of June demand, but additional procurement costs are expected to reach into the billions of US dollars to complete.

As such, the renewed use of coal is intended both to address supply risks and to limit the impact of higher gas prices on electricity tariffs.

China is also responding to the ongoing limit in supplies by changing how coal is used rather than simply burning more of it for power generation. The report says that China Shenhua Energy, the country’s largest listed coal producer, plans to cut coal output by 0.6% this year while increasing investment in coal-to-olefin production facilities; olefins being key feedstocks for plastics, textiles and solvents. The company also plans to double annual production capacity to 1.4mn tonnes next year.

The shift reflects tightening supplies of oil-derived feedstocks such as naphtha and liquefied petroleum gas (LPG), both affected by disruption in the Strait of Hormuz. China International Capital Corporation said coal’s profitability advantage over oil in chemical production has reached its highest level since 2015.

South Asia and the subcontinent are facing similar pressures. Bangladesh has increased coal-fired generation and electricity imports since March while rationing gas supplies. At the same time, Pakistan has avoided blackouts on the scale seen during the Ukraine war in 2022 thanks to expanded solar capacity, but it is also increasing domestic coal generation and curbing demand for now.

India is responding by raising coal imports while reducing industrial gas consumption for the same reasons.

To the east, governments in Southeast Asia are also formalising fuel-switching policies. Philippine Energy Secretary Sharon Garin recently told Reuters that the Philippines plans to increase coal-fired generation – at least temporarily – to contain rising electricity costs. Without intervention, electricity tariffs could rise by around 16% as early as June.

Manila is now seeking stable coal supplies from Indonesia, reversing a trend that saw Philippine coal-fired generation decline last year for the first time in nearly two decades.

Vietnam’s state utility EVN is another body negotiating additional coal imports to conserve LNG supplies, while Thailand has increased operating rates at its largest coal-fired power plant and has also raised biofuel blending ratios from 7% to 10%.

South Korea and Japan in Northeast Asia are also finding it increasingly difficult to maintain aggressive coal phase-out policies.

According to Korea Customs Service data, South Korea imported 8.82mn tonnes and 9.08mn tonnes of coal in March and April respectively, up 26.3% and 27.2% year-on-year, the report adds. In doing so, combined imports for the two months reached their highest level in three years.

Coal imports rarely reach winter-like levels during spring, when energy demand is usually lower. The increase thus reflects tightening LNG supplies caused by the Hormuz crisis and force majeure declarations in Qatar. In knock-on effect, South Korea’s LNG imports fell 10.2% year on year in March and 14.6% in April.

In response, Seoul lifted the seasonal 80% operating cap imposed on coal-fired plants for air quality reasons. Even as early as March 24, President Lee Jae-myung instructed officials to review closure plans for three coal-fired units — Hadong Unit 1, Boryeong Unit 5 and Taean Unit 2 — which had been scheduled to shut from June.

Seoul has also decided to expand nuclear generation significantly to offset LNG volatility but for now, coal is viewed as the quickest short-term substitute because existing infrastructure is already in place.

Japan is taking a similar approach given that more than 90% of its crude oil imports come from the Middle East, with around 70% passing through the Strait of Hormuz.

As a result, and according to NHK and Nikkei, Tokyo suspended operating restrictions on thermal power plants for one year from April 1 as part of emergency energy measures. The government is simultaneously diversifying crude imports while relying on coal-fired generation as a contingency option.

 

Mozambique Contests TotalEnergies' $2 Billion Cost from LNG Project Delay

By Tsvetana Paraskova - May 27, 2026

The government of Mozambique disagrees with TotalEnergies’ estimate that the years-long delay in the Mozambique LNG project has cost it and its partners $2 billion in overruns, a source familiar with the matter told Bloomberg on Wednesday.

TotalEnergies and its partners in the $20-billion Mozambique LNG project had to suspend work and declare force majeure for several years amid serious concerns about security due to Islamist attacks near the site.

A recent audit report by UK-based consultancy Bayphase could not confirm the costs TotalEnergies claims to have incurred due to the delay. So Mozambique is not inclined to accept the $2-billion cost overrun estimate, according to Bloomberg’s anonymous source.

Mozambique has yet to approve an updated development plan for the massive LNG export project, which could transform the economy of one of Africa’s poorest countries and increase supply to the global LNG market in the medium to long term.

However, in order to approve the updated plan, Mozambique and the project developers need to be on the same page about costs. The government and the French supermajor continue discussions on the costs and the plan and they could still reach an agreement on how to proceed, Bloomberg’s source said.

After a five-year hiatus, in January 2026 TotalEnergies formally re-launched the Mozambique LNG project.

At the end of last year, TotalEnergies lifted the four-year-long force majeure on the Mozambique LNG project, which was stalled due to the precarious security situation near the site of the planned export facility. The project site is close to the town of Palma in the Cabo Delgado province, where Islamic State-affiliated militants were active for years.

In the spring of 2021, following Islamist militant attacks in towns close to the construction site, TotalEnergies declared force majeure and suspended works on the project. Mozambique LNG was Africa’s largest foreign investment when announced.

Due to the force majeure, the goal to achieve first LNG production has slipped, first to 2027, and later, to 2029.

By Tsvetana Paraskova for Oilprice.com

US/Iran Energy Shock Damage Is Spreading in Asia

The US/Iran-linked energy crisis has shifted from a commodity shock to structural geopolitics, with Asia at the epicenter due to its dependence on imported oil and LNG. Global reverberations can no longer be avoided.

by Dan Steinbock | May 19, 2026 | 

In the Asian shock, four transmission channels play a role. In the case of oil, elevated risk premium is coupled with physical tightening via Strait of Hormuz disruptions.

Lliquefied natural gas (LNG) poses a more severe constraint than oil and thus structural tightening of Asian gas balances. Meanwhile, coal substitution is experiencing a short-term demand surge in Asia, especially in India, China and Southeast Asia.

On the economic side, countries are struggling with imported inflation, foreign exchange pressure, and painful policy trade-offs between subsidy support and fiscal stability.

The shock is no longer a temporary price spike but a sustained supply reordering. The International Energy Agency (IEA) projects large-scale oil drawdowns. LNG disruptions are removing 20% of global LNG flows at peak disruption, which will tighten Asian supply chains significantly.

What happens in Asia won’t stay in Asia. In the coming months, the adverse reverberations will be felt across the world.

Asian Century and global growth at stake    

Asia remains the engine of global economic growth, with China and India alone contributing roughly 40–45% of incremental global GDP growth, while other major Asian economies – Indonesia, South Korea, Vietnam, and ASEAN collectively – add another 10–12%.

In the medium term, Asia’s share of global growth is expected to rise further as Western economies slow, driven by demographic momentum, urbanization, and productivity gains in services and manufacturing.

However, a severe energy crisis, particularly if it triggers sustained LNG and oil shortages, would sharply compress industrial output, inflation-adjusted consumption, and investment in these economies, potentially reducing global growth by 1–2 percentage points in 2026–27.

An Asian slowdown would have significant spillovers to the US, Europe, and Japan through trade, investment, and financial channels. Reduced Asian demand would depress exports of machinery, electronics, and consumer goods from these regions. Higher energy prices would further weigh on consumption and industrial costs. Financial markets could face increased volatility, amplifying capital flow disruptions.

In Japan, the combination of energy dependence and weaker regional demand could sharply constrain growth, while Europe and the US would experience slower industrial output and dampened inflation-adjusted consumption, reinforcing the global drag from the Asian energy shock.

Oil tightness, LNG constraint, brief coal rebound

Oil remains volatile but more flexible than gas. Prices surged above $100/bbl during peak disruption and remain elevated ($90–100 volatility band in stress conditions)

Strait of Hormuz instability has removed millions of barrels/day of export capacity. OPEC+ spare capacity is partially offsetting but insufficient to normalize inventories. Inventories are falling at record pace, reducing the buffer against further shocks.

Unlike earlier cyclical oil shocks, this episode is characterized by structural inventory depletion, making price spikes more persistent even if supply partially recovers.

Nonetheless, natural gas is the primary stress point for Asia. Up to 20% of global LNG supply was disrupted at peak due to Hormuz-linked flows. Asian LNG prices surged above $20/MMBtu in multiple spot windows.

Northeast Asian importers (Japan, Korea, China, Taiwan) entered emergency procurement and rationing. Long-term contracts are under stress due to force majeure risks and shipping rerouting constraints.

Asian LNG imports have dropped sharply. Qatar/UAE-linked exports remain vulnerable due to chokepoint exposure. LNG is increasingly perceived in Asia as less reliable as a transition fuel, accelerating diversification away from gas-heavy strategies in parts of the region.

Then there is the curious rebound of coal, temporarily distorting markets. Asia’s immediate adjustment has been substitution, not demand destruction. China, India, Indonesia and other countries have increased coal burn in power generation. In several ASEAN economies, this is increasingly seen as short-cycle substitution, not structural reversal.

Renewables deployment acceleration continues in parallel (especially China, India). 

How are countries coping

China is managing a dual challenge: LNG exposure plus industrial cost pressure. Hence, the simultaneous deployment of coal and renewables. Strategic LNG diversification has increased from the Middle East to Russia, US and Australia. Energy security is now embedded into industrial policy response.

India is highly exposed to imported LNG and oil inflation. Strong coal buffer limits crisis severity but increases environmental cost, which is already soaring with the nation’s broad takeoff. Unsurprisingly, fiscal pressure is rising from fuel subsidies. The net effect is manageable but inflationary growth drag.

Japan and South Korea are structurally most exposed to LNG disruption. So, emergency procurement and demand management measures have been activated, with the acceleration of nuclear restarts and efficiency gains. Now energy security dominates macro policy debate.

Southeast Asia (Indonesia, Vietnam, Thailand, Philippines) is highly price-sensitive to LNG demand. Consequently, LNG project cancellations and delays have a painful impact, which is rapidly translating to political volatility. Hence, the efforts to re-optimize coal in Indonesia and Vietnam.

Longer-term shift prevails toward renewables and regional grid integration. But as energy reserves are diminishing, the focus is on the short-term. To paraphrase Keynes: in the long-run, we’re all dead. 

From economic transmission to energy shift

The energy shock is feeding directly into consumer price index (CPI) via fuel, logistics, and fertilizers. Hence, the secondary pass-through into food prices, notably in South Asia.

Foreign exchange is under severe pressure as import-dependent Asian economies are facing severe currency depreciation pressure. Before the crisis, US dollar was less than 58 Philippine peso; now, close to 62. Meanwhile, central banks are forced into tighter-than-expected monetary policy stance.

Industrial slowdown risk is increasing. Energy-intensive manufacturing margins are compressed. Fertilizer, petrochemicals, and steel sectors are most exposed.

The crisis is accelerating three structural shifts. The first entails the move from LNG expansion to LNG risk hedging.

Second, the past objective to move away from fossil transition has been superseded by energy security primacy.

Third, electrification has accelerated. Renewables and storage investment are front-loaded. Future is not next year. It’s now.

Trump–Xi summit: hope for stability 

Prior to the summit, analysts hoped that the US-China talks could serve as a stabilizing variable for global energy markets, in three ways.

Strategic signaling fosters oil price stabilization, just as US–China coordination reduces demand-side geopolitical uncertainty. The potential easing of tariff and geoeconomic tensions could support global demand expectations.

Second, LNG trade realignment suggests that China may diversify LNG imports further from politically sensitive corridors. US LNG exports could benefit from strategic trade normalization, while Europe–Asia LNG competition could moderate if US-China trade improves.

Third, there is the political minefield of sanctions and Iran-related diplomacy: Even limited coordination could reduce escalation probability in the Middle East, which is vital to avoid extreme oil price spikes.

From the standpoint of the energy markets, the summit was less about immediate supply restoration and more about reducing geopolitical volatility embedded in energy pricing. But the success of the summit will be determined by the markets only in its aftermath.

Unsettling scenarios for 2026–27 

Base scenario: Partial stabilization of the Middle East conflict proceeds without full resolution. Hormuz remains intermittently disrupted but not fully closed. LNG supply is partially restored but tight. Oil inventories rebuild slowly but remain below norm. Brent crude varies around $85–105/bbl and LNG Asia spot at $12–20/MMBtu. Inflation stays elevated but manageable. Asia faces growth drag but no recession.

Optimistic scenario: Diplomatic stabilization is supported by US–China coordination following the summit. Shipping lines are gradually reopened. LNG infrastructure is partially restored. OPEC+ increases output into recovering demand. Brent crude falls to $65–85/bbl and LNG to $8–14/MMBtu. Inflation falls sharply in Asia. Policy easing resumes globally and energy transition investments accelerate again.

Pessimistic scenario: Renewed military escalation takes off in the Iran–Gulf theater. Hormuz’s closure is sustained or repeated. LNG infrastructure damage spills over in Qatar/Gulf. Severe inventory depletion triggers panic buying. Brent crude soars to $110–140+/bbl and LNG climbs to $20–35/MMBtu. Severe imported inflation shock spreads, with industrial slowdown and rationing risk in parts of Northeast Asia. Renewables and coal substitution surge simultaneously. With financial volatility, emerging market currencies fall and capital flight resumes.

The 2026–27 outlook is at best clouded in uncertainty. The concern is that it will morph into high plateau volatility.

The original version was published by China-US Focus (US/Hong Kong) on May 15, 2026.

Dr. Dan Steinbock is an internationally recognized visionary of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute (US), Shanghai Institutes for International Studies (China) and the EU Center (Singapore). For more, see https://www.differencegroup.net 

Middle East War Threatens Renewable Energy Rollout

By Rystad Energy - May 13, 2026

• Renewable energy projects across the Middle East face delays of three to 12 months.
• 
  
• Solar imports into Gulf markets have collapsed as maritime disruption and cost pressures intensify.
• 
  
• Higher oil and LNG prices strengthen the long-term case for Gulf states to deploy renewables domestically.

War in the Middle East has reshaped near-term energy market expectations, with direct implications for hydrocarbon supply affecting power sectors across liquified natural gas (LNG) imports, oil imports, and spot gas-dependent economies, mainly in Europe and Asia. While Middle Eastern countries retain access to abundant domestic fossil fuels, the effective closure of the Strait of Hormuz and the crisis extends disruption beyond hydrocarbons. The combination of conflict proximity, supply chain vulnerability, capital diversion, and institutional resilience is critical for renewables deployment. Rystad Energy analyzes how the conflict is affecting renewable energy deployment across key Middle Eastern markets.

The crisis is expected to result in a net delay of between three and 12 months across the active renewable energy pipeline in the Middle East, while simultaneously strengthening the medium to long-term strategic commitment to the energy transition. The overall effect is a short-term delay followed by a sharper medium-term acceleration in Saudi Arabia, the UAE, Oman, and Turkiye, while Qatar, Kuwait, Iraq, Bahrain, and Jordan are expected to face moderate delays with recovery contingent on market stabilization. Additionally, Iran, Israel, Syria, Lebanon, and Yemen remain high risk and are likely to face prolonged delays in renewables deployment (Figure 1).

Supply chain disruption

There is a clear disruption across key maritime routes that is already pushing back project timelines. While other regions have registered high module imports due to China's elimination of the VAT export rebate on 1 April, the Middle East region lagged behind. The March 2026 solar PV imports collapsed against 2025 monthly averages across every Persian Gulf market- the UAE fell 608 MW from 767 MW to just 160 MW, Saudi Arabia dropped 625 MW from 704 MW to 80 MW, and Oman fell to zero from 77 MW. The contrast with Türkiye importing 248 MW (+166 MW above its 2025 average) and Israel at 220 MW (+118 MW), reflecting their independence from Hormuz and Red Sea routing (Figure 2).

The impact is more severe because multiple cost pressures have materialized simultaneously. The freight rates for the Asia-Mediterranean route are up from $2,826/FEU in late February to $3,594/FEU by early April. Additionally, China's elimination of the VAT export rebate on 1 April added a direct 9% cost impact on module pricing, while silver prices in the USD 70–80/oz range are pushing up cell costs, prompting OEM suppliers, EPC contractors and developers to revisit signed contracts, repricing risk, and consider redirecting capital toward more stable, lower-risk markets within the Middle East.

The region's highly competitive auction market, which results in world-record bids in the range of USD 10.5 - USD 20/MWh, gives a thin margin to the developers. To achieve this, the CAPEX intensity for these projects is already at a lower end. Multiple cost pressures and with war risk premium now being embedded into project finance, EPC contractors are repricing force majeure and logistics exposure into new bids. Countries like Kuwait, progressing to awarding their first large-scale solar projects totaling 1.6 GW, are particularly vulnerable to this repricing. For projects that have already reached financial close across the Middle East, the result is margin compression.

Middle East solar module manufacturing capacity is expected to grow from 4.7 GW in 2025 to 35.8 GW by 2030 — a sevenfold expansion in five years. Türkiye, already plateaued at 22.2 GW of domestic manufacturing capacity from 2026 onward, is effectively import-independent for solar modules and fully insulated from any future Hormuz disruption.

The financial incentive for renewables deployment for oil and gas-exporting Gulf states such as the UAE, Saudi Arabia, Qatar, Kuwait, and Iraq has strengthened under this crisis. At more than $90 per barrel of Brent crude oil and between $15 and $20 per million British thermal units of LNG, every megawatt of solar or wind deployed domestically frees up hydrocarbons for export at elevated prices. The opportunity cost of burning liquids/gas in a domestic power station has never been higher. However, the effective closure of the Strait of Hormuz remains a significant constraint for countries reliant on the route for exports. Gulf renewables programs are facing logistical and financial delays, not strategic ones, and striking the right balance between restoring hydrocarbon exports and renewables deployment will result in an optimal outcome.

By Rystad Energy

  

Chinese firms warn Indonesia’s nickel quotas, tax hikes threaten investment

Reuters | May 13, 2026 |

Image: Tsingshan Holding Group

Chinese companies operating in Indonesia are urging more business-friendly policies, warning tighter nickel ore quotas, higher taxes and a new pricing formula are driving up costs and threatening investment in the world’s biggest nickel producer.

In a letter to President Prabowo Subianto, copied to China’s embassy and seen by Reuters, the China Chamber of Commerce in Indonesia said Chinese firms faced “excessively stringent regulation, over-enforcement”, and alleged corruption and extortion by authorities.

Five sources with knowledge of the matter confirmed the letter, requesting anonymity because they were not authorized to speak publicly.

The complaint highlights tensions between Jakarta’s push to extract more value from its natural resources and the Chinese capital that has powered Indonesia’s rapid expansion in global nickel supply.

The letter cited higher taxes and royalties, planned foreign-exchange retention rules, stricter forestry enforcement, work-visa restrictions and suspensions of major projects.

Its strongest warning focused on nickel, where Chinese firms dominate downstream processing after years of investment in smelters, stainless steel plants and battery-material projects.

Nickel ore mining quotas have been sharply reduced this year, with cuts for large mines exceeding 70% and total reductions reaching 30 million metric tons, the chamber said.

It also criticized Indonesia’s revised nickel ore benchmark pricing formula, known as HPM, saying the changes had raised costs and could undermine existing projects and future investment.

The government has delayed planned increases in mineral royalties and export duties while it works on what officials have described as a fairer formula for the state and miners.

Speaking earlier on Wednesday, Prabowo said many foreign investors had complained Indonesia required too many permits and approvals took too long, and called for deregulation to support investment, without naming any country.

The chamber did not respond to an emailed request for comment. A spokesperson for Prabowo did not respond to a text message seeking comment.

Tsingshan Group, Zhejiang Huayou Cobalt and Brunp are chamber board members that operate nickel facilities in Indonesia.

(By Dylan Duan, Stanley Widianto, Gayatri Soroyo, Gibran Peshimam, Christina Bernadette and Tom Daly; Editing by Mark Potter)

Indonesia delays plan to impose higher royalties, export duties on minerals

Reuters | May 11, 2026 | 

Stock image.

Indonesia has delayed plans to extract more revenue from the mining sector until it can figure out an “ideal formulation” that benefits both the government and mining firms, the country’s mining minister said on Monday.

The government planned to impose higher royalties on some mining companies, as well as an export tax on shipments of certain minerals, including coal.

The ministry is collecting feedback from miners to make sure the government arrives at a policy that will not burden the sector, Energy and Mineral Resources Minister Bahlil Lahadalia told reporters.

“After hearing input from the public and businesses, I will put this on hold to develop a good, mutually beneficial formula,” Bahlil said.

Officials have previously said that the government aims to increase revenue from the mining sector.

 

Freeport delays Grasberg full restart to early 2028

Staff Writer | May 8, 2026 | 

Grasberg mine. (Image courtesy of Indonesia’s Ministry of Mines and Minerals Resources.)

PT Freeport Indonesia has confirmed the delayed restart of full production at the Grasberg mine, as it continues to recover from a deadly accident last year that crippled the global copper supply chain.

In a statement on Thursday, the company said it now expects the giant complex in Central Papua province to return to full capacity by early 2028. Previously, it had targeted a full restart by end-2027.

A Freeport spokesperson told Reuters that this delay was due to “additional work on logistics and ore handling infrastructure” at the underground mine that was hit by a severe mudflow in September.

The incident, which occurred at Grasberg’s Block Cave underground mine portion, resulted in the death of seven workers, forcing Freeport to immediately halt mining activity and declare force majeure on shipments.

The suspension added further strain on the global copper market, as Grasberg accounted for about 3% of the world’s copper supply at the time, producing about 1.7 million lb. of the metal annually. It is also a major producer of gold, with annual production of 1.4 million oz.

Slowed ramp-up

As part of the recovery process, Freeport has laid out plans for a phased restart, beginning with areas that were unaffected by the mudslide. The Deep Mill Level Zone and Big Gossan underground mines had already resumed last year, while parts of GBC returned to operations last month.

Initially, the miner planned to ramp up to 85% capacity by the middle of this year, then 100% by end-2027. However, in its most recent earnings statement, the company said the trajectory to full production would slow materially, and now aims for 65% capacity in the second half of 2026, 80% by mid-2027, and near full capacity by the end of 2027.

Operations are currently in the recovery phase following the underground mine incident, “with production currently at around 40% to 50%,” Freeport Indonesia’s chief executive Tony Wenas stated in a press release on Thursday. “The company targets a return to full capacity by early 2028,” he added.

As a result of the delay, the company expects Grasberg’s copper production this year to be 700,000 lb., down from the 1-billion-lb. target it had forecasted in its fourth-quarter earnings report.

Earlier this year, the Freeport-McMoRan (NYSE: FCX) unit reached an agreement with the Indonesian government for a life-of-resource extension of operating rights.