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Kepmen ESDM 268/2025 is the operational pricing engine at the base of Indonesia's hilirisasi 2.0 fiscal architecture. It sits below and feeds the progressive royalty framework of PP 19/2025: without a credible HPM/HPB reference price, the sliding-scale royalty rates (nickel 14–19%, cobalt new, gold 10–16%) cannot be enforced against sophisticated parties using transfer pricing to artificially suppress taxable revenue.
What changed from Kepmen 72/2025:
The predecessor Kepmen 72/2025 had mandated that all mineral and coal sales reference HPM/HPB as a price floor — an operationally rigid requirement that drew immediate pushback from miners with long-term contracts locked below market. Kepmen 268/2025 relaxes this by carving out pre-existing contracts from the price-floor mandate. The anti-abuse anchor is preserved, however: even if a sale is permitted below HPM/HPB, royalty and tax liabilities are calculated at the higher HPM/HPB value. The decree thus separates commercial pricing freedom (restored) from fiscal obligation (fixed to reference price).
Commodities covered:
reflecting ore grade and processing pathway (saprolit vs. limonite).
aligned with the new cobalt royalty tier introduced by PP 19/2025.
(Freeport Grasberg, Amman Mineral Batu Hijau).
(Inalum) integrated chain.
monthly Harga Batubara Acuan (HBA) gazette publication by Ditjen Minerba.
Monthly HMA/HBA publication cadence:
The HPM and HPB reference prices set by this decree are not static — Ditjen Minerba publishes monthly Harga Mineral Acuan (HMA) and Harga Batubara Acuan (HBA) fixing the actual price level within the formula framework. Companies must reconcile royalty payments against whichever month's HMA/HBA applied to the sale period.
smelters and traders negotiate discounts. For a jurisdiction producing ~1.8 Mt of nickel content annually at a 14–19% progressive royalty, each $1,000/t move in the HPM reference translates to material fiscal impact.
that sell nickel intermediates (MHP, NiSO₄) to affiliated Chinese battery makers at intercompany prices can no longer reduce Indonesian royalty exposure via invoice manipulation.
Indonesian cobalt production, ahead of what is expected to be a significant ramp-up as HPAL (high-pressure acid leach) capacity expands. Producers cannot argue cobalt is an incidental by-product for royalty purposes.
time-limited by the expiry of those contracts. As legacy offtakes roll off (2026–2028 window), the full HPM/HPB price-floor mandate will progressively bite.
On 10 April 2026 (effective 15 April 2026), MEMR issued Kepmen ESDM No. 144.K/MB.01/MEM.B/2026, materially revising the nickel-ore HPM formula in three ways. First, the correction factor for 1.6% grade nickel ore is raised from 17% to 30%, with a 1% CF inverse movement per 0.1% grade change. Second, the formula is extended from a single-metal nickel benchmark to a polymetallic byproduct-inclusive formula: HPM = [(% Ni × CF_Ni × HMA_Ni) + (% Fe × CF_Fe × HMA_BijihBesi × 100) + (% Co × CF_Co × HMA_Co) + (% Cr × CF_Cr × HMA_BijihKrom × 100)] × (1 − MC), where cobalt (CF=30%, threshold Co≥0.05%), iron (CF=30%, threshold Fe≤35%), and chromium (CF=10%) are treated as separately-priced constituents for the first time. Third, the HPM pricing unit shifts from USD per dry metric ton (DMT) to USD per wet metric ton (WMT). This is Indonesia's first explicit policy instrument treating cobalt as a fiscal commodity rather than a free by-product, enabling royalty rates of 2–10% on cobalt streams from HPAL operations and opening a parallel royalty pathway for iron and chromium byproducts from Indonesian laterite-nickel processing. The amendment directly responds to the expansion of HPAL capacity in Morowali (IMIP) and Weda Bay (IWIP) producing MHP with meaningful cobalt, iron, and chromium content that previously escaped the nickel-only royalty base.
indirect export restriction (similar to DS592 nickel ore case); legal exposure is lower since domestic sales are not banned, only royalties fixed to reference prices.
commercial pressure on Chinese smelter operators in Morowali/Weda Bay will increase.
additional critical minerals (scandium, gallium, germanium) from Indonesian laterites as processing capabilities mature.