Coal tycoon Samin Tan arrested as Indonesia deepens illegal mining crackdown

[JAKARTA] Indonesia has arrested coal tycoon Samin Tan in a corruption case linked to alleged illegal mining activities. It is one of the most high-profile moves yet in the government’s widening crackdown on unlawful resource extraction.

The Indonesian Attorney-General’s Office announced on Saturday (Mar 28) that the billionaire businessman was a suspect in a case involving alleged irregularities in mining management and illegal coal extraction in Central Kalimantan by Asmin Koalindo Tuhup (AKT).

Tan has been identified by the authorities as the beneficial owner of the company.

Investigators allege that coal mining and sales linked to Tan continued even though the mining permit for AKT had been officially revoked by the government in 2017.

The authorities said the continued exploitation of natural resources under the company was unlawful and violated existing regulations.

“After the permit was revoked, AKT continued carrying out mining operations and selling coal illegally until 2025,” said Syarief Sulaeman Nahdi, director of investigations at the special crimes unit of the Attorney-General’s Office.

Tan is also facing an administrative fine of around 4.2 trillion rupiah (S$318.7 million) for the alleged illegal activities.

Prosecutors suspect the tycoon of committing corruption by allegedly coordinating with mining supervisors to allow operations to continue despite the revocation of the permit.

For now, he is the only suspect formally named in the case, though investigators said they have identified the potential involvement of government officials and are strengthening evidence for further legal action.

Tan’s legal troubles date back several years. In 2019, he was named a suspect by Indonesia’s anti-graft agency in a bribery case involving a lawmaker linked to resolving a permit dispute at AKT.

Tan was briefly listed as a fugitive before being arrested in 2021. However, an anti-corruption court later acquitted him, ruling that the prosecution had failed to prove he was guilty of bribery.

The latest investigation, however, has placed the coal tycoon back under scrutiny as the authorities probe the alleged illegal mining activities linked to the company.

On Monday, a spokesperson for the Attorney-General’s Office told The Business Times that the authority is compiling evidence to determine whether any state officials were involved in the case’s handling in 2021.

Well-known figure

Tan, a well-known figure in Indonesia’s mining industry, was listed by Forbes in 2011 as one of Indonesia’s wealthiest individuals. It estimated his net worth at about US$940 million.

Born in Riau in 1964, he built his fortune through coal-mining ventures, most notably through Borneo Lumbung Energi & Metal, a company focused on producing high-grade metallurgical coal used in steelmaking.

Under his leadership, the firm grew into one of Indonesia’s key producers of metallurgical coal, a niche segment in the country compared with its more-dominant thermal coal sector.

Tan’s business dealings also stretched beyond Indonesia. He previously invested heavily in Bumi, a London-listed venture formed by Indonesia’s conglomerate Bakrie Group in partnership with financier Nathaniel Rothschild.

The investment – worth about US$1 billion when it was executed in 2012 – eventually soured, with the company’s share price suffering a beating, wiping out much of Tan’s wealth and triggering disputes with the Bakrie family.

The businessman also made a high-profile attempt to gain control of Asia Resource Minerals, the former London-listed parent company of Berau Coal Energy, though the effort ultimately failed.

Tan began his career as an accountant, and worked at major consulting firms including KPMG and Deloitte before moving into investment and the resource business.

Deepening crackdown

The latest case is tied to broader efforts by Indonesia’s Forest Area Enforcement Task Force, which has been entrusted with bringing illegal mining and plantation activities in forest areas under control.

The task force confirmed that Tan remains obligated to pay the 4.2 trillion rupiah administrative penalty.

Officials said that the government has attempted to collect the fine since January this year, issuing summonses, warnings and formal notices over payment and the termination of mining operations.

The arrest comes as Indonesia intensifies its scrutiny of illegal mining operations that have long plagued the country’s vast resource sector.

Analysts said that the move could signal a stronger push by the administration of President Prabowo Subianto to enforce regulations in the mining industry, though they caution that consistency will be key.

Fickar Hadjar, a criminal law expert from Trisakti University, said the case illustrates how illegal mining activities could continue for years even after permits were revoked, raising concerns about oversight and the possible involvement of officials.

Bisman Bakhtiar, executive director of the Center for Energy and Mining Law Studies, pointed out that the detention “sends a signal of firmer law enforcement, including against major actors in the sector”.