Highlights of Mining for Gold in Indonesia
- Stable multi-party democracy
- World-class gold deposits, including Grasberg the world’s largest gold deposit with 67.4 million ounces
- Improving climate for gold mining attracting renewed exploration activity and investment
- Martabe Mine in Sumatra bought for US$775 million from G-Resources on March 17, 2016 by EMR Capital (61.4%), Farallon Capital (20.6%) & two Indonesian Investors (18%)
Gold Production in Indonesia
Currently, Indonesia produces around four percent of global gold production, half of which originates from the giant Grasberg mine, the world largest gold mine, on the western half of Papua. This mine, which is believed to contain the world’s largest gold reserves (67.4 million ounces), is majority-owned by the American company Freeport-McMoRan Copper & Gold Inc. and makes it the largest taxpayer to the Indonesian government.
Gold, the most malleable or ductile metal, is regarded as a precious metal due to its texture, density and high melting points. Gold mining companies are active on all the populated continents on Earth. ( As the 1991 Madrid Protocol banned all Mining Activities on Antarctica indefinitely.) This wide geographical distribution in production means that interruptions in any single region due to local political or social matters are unlikely to have a large impact on the global gold supply. Apart from gold production through mining, recycling of gold (which accounts for around a third of the total current supply) adds to production numbers. In addition, central banks can also influence the supply-side when they sell part of their gold reserves. It is worth noting that after two decades of being net sellers, central banks are now effectively net buyers of gold, resulting in a significant decrease in supply and a corresponding, simultaneous increase in demand.
Indonesia #6 Largest Global producer of the Top Gold Producing Countries 2019
|4. United States||200||3,000|
|7. Ghana, Peru||130||1,000,|
|9. Kazakhstan, Uzbekistan||100||1,400,|
|10. South Africa||90||3,200|
In tons of gold – Source: USGS https://www.usagold.com/cpmforum/world-gold-production-by-country/
Indonesia’s Gold Production and Largest Gold Mines
As gold production in Indonesia – by far – outpaces domestic gold demand, most of production is shipped abroad. However, the Indonesian government is currently stimulating the establishment of national processing industries in order to increase profits by exporting products that have added value. Gold production (in tonnes) has only increased after a large drop after great financial crisis in late 2000's.
Source: USGS & www.ceicdata.com
Indonesia’s Gold Production in Sumatra and West Java
One of Indonesia’s most prolific gold producing area’s is Sumatra and West Java. This map shows the numerous mines in this emerging world class gold province.