Groundwater Use Approvals and Administrative Fines: PERMENESDM 4/2026

The Minister of Energy and Mineral Resources has issued Regulation No. 4 of 2026, Pedoman Penggunaan Sumber Daya Air pada Air Tanah — Guidelines on the Use of Water Resources in Groundwater — whose full official title continues with the procedures for imposing, calculating, paying and remitting non-tax state revenue in the form of administrative fines for the regularisation of groundwater business permits (Izin Pengusahaan Air Tanah) and groundwater use approvals (Persetujuan Penggunaan Air Tanah). The regulation runs to 48 articles and covers two subjects at once: the licensing lifecycle of groundwater use approvals, and the sum owed to the state when previously unlicensed abstraction is brought into the licensing system.

Background

Groundwater abstraction in Indonesia sits under the water resources framework, which separates commercial exploitation from other use and requires a permit or an approval before a well may be operated. A recurring administrative problem has been the stock of wells drilled and operated without any licence document, which cannot be legalised without a mechanism for accounting for the period of unlicensed abstraction. PERMENESDM 4/2026 addresses that stock through penataan — a regularisation route — and attaches a non-tax state revenue charge to it.

Key Provisions

Pasal 1 sets the vocabulary. It defines Sumber Daya Air (water resources) as water, water sources and the water power contained in them, and Air Tanah (groundwater) as water held in soil or rock layers beneath the surface. The same article defines Penerimaan Negara Bukan Pajak (PNBP) as state revenue derived from services or from the use of state-held resources and rights, collected outside taxation and grants and administered through the state budget mechanism; Wajib Bayar as the individual or entity obliged to pay PNBP; and PNBP Terutang as the PNBP obligation payable at a specified time.

The licensing sequence is built around the Persetujuan Penggunaan Air Tanah (groundwater use approval). Pasal 8 governs its issuance, Pasal 11 its extension, and Pasal 12 its amendment, with the rights and obligations of holders set out in Pasal 9 and Pasal 10. Pasal 16 covers approvals issued through the regularisation route, and Pasal 17 provides that the rights and obligations in Pasal 9 or Pasal 10 apply mutatis mutandis to regularisation holders, with the exception of Pasal 9(2)(b) and Pasal 10(2)(b). Approvals are issued in the format annexed as Lampiran II, per Pasal 19.

Pasal 18 sets the abstraction ceiling rule. For issuance under Pasal 8, extension under Pasal 11, amendment under Pasal 12 and regularisation under Pasal 16, the permitted discharge (debit) is limited across all Groundwater Conservation Zones and in unconfined aquifers, and the limit is fixed on the basis of verification and evaluation rather than the volume requested by the applicant.

Revocation is dealt with in Pasal 14. An approval may be revoked on the holder's own application, as a follow-up to an administrative sanction, or on the basis of a court decision with permanent legal force. An application for revocation goes to the Minister, governor, or regent/mayor according to their respective authority through the Online Licensing Application, and the revocation must be issued within 14 working days of the application. Where revocation follows a court decision, the competent authority must act within 14 working days of receiving the decision. All obligations attaching to the approval, including closure of the drilled or dug well, must be completed within 30 calendar days of the revocation date, following technical guidance set by the Minister. Failure to close the well is sanctioned under the water resources legislation rather than under this regulation.

Implications

Holders and applicants deal with a single online channel and with fixed decision clocks, and the discharge figure written into an approval is the product of verification and evaluation across every conservation zone rather than a negotiated quantity. Operators seeking to regularise an existing well take on a PNBP administrative fine as part of legalisation, and that charge is calculated, paid and remitted under the procedures the regulation supplies. Regional authorities carry the revocation timetable and the post-revocation well-closure follow-up, which ties the licensing file to physical closure of the borehole.

Regulatory Context

The regulation shares a design with the 2026 environmental instruments that pair a supervisory function with a monetary consequence: the same year saw rules on environmental supervision and on administrative fines built on the same sequence of inspection, finding, and charge. Here the charge is framed as non-tax state revenue attached to a licensing correction, while the enforcement tail for an unclosed well is routed back to the water resources statute and its own administrative sanctions regime. Ministerial technical guidance on well closure and the annexed approval format complete the instrument.

Read the full regulation in the CRPG Law Database.

Methodology: This memo summarises the official regulation text and is not legal advice; report corrections to contact@crpg.info.

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