Indonesia ranks among the top global producers of nickel, a critical component in electric vehicle batteries, smartphones, and wind turbines - making the country central to the global shift toward clean energy. To secure access to this strategic mineral, major economies like China, the US, and the EU have deepened investment ties with Indonesia.

Yet, this boom comes with a stark contradiction. While the nation reaps economic gains, nickel mining is placing growing pressure on vulnerable ecosystems, particularly in eastern regions like Raja Ampat in Southwest Papua. Gag Island, part of this biodiverse archipelago, has become a focal point in the clash between environmental preservation and industrial growth.

The beginnings of nickel mining in Raja Ampat

Investment in the nickel sector contributed over 62% of the total mineral sector investment, which reached IDR245.2 trillion ($15bn) between January and December 2024, as reported by Media Nikel Indonesia. For instance, nickel exploration on Gag Island was initiated by PT Gag Nikel, a subsidiary of PT Aneka Tambang (Antam) Tbk, under a Contract of Work granted in 1998. However, mining activities were halted in 2005 when Gag Island was designated a national marine conservation priority. According to Tempo, this conservation status led to a temporary suspension of permits. PT Gag later reapplied for environmental clearance following revisions to regional spatial planning and received approval from the Ministry of Environment and Forestry (KLHK) in 2017.

Why Gag island matters

Gag Island, spanning less than 2,000 km², technically falls under the protection of Law No. 1/2014 on Coastal and Small Island Management, which prohibits mining on small islands. However, Kompas reports that an exception was granted because PT Gag Nikel’s Contract of Work was issued before the law came into effect. Hukumonline highlighted how this legal loophole has enabled mining operations to continue - often at the expense of environmental protections.

While PT Gag Nikel is the most high-profile operator, it is far from the only one. Companies like PT Anugerah Surya Pratama (ASP), PT Anugrah Surya Indotama (ASI), and PT Kawei Sejahtera Mining (KSM) have also been linked to contentious activities in Raja Ampat. Notably, PT ASI has been accused of operating in defiance of a governor-issued moratorium, allegedly under the shield of military backing. PT KSM, one of the first to export nickel from the region in 2008, sparked fierce opposition from residents of Kawe Island. These incidents point to a troubling pattern: corporate interests frequently sidestep regulatory safeguards, often with little to no accountability.

Experts warn that Gag Island’s fragile karst ecosystem is especially vulnerable to the impacts of open-pit mining, which can lead to deforestation, polluted groundwater, and sedimentation that endangers coral reefs and marine life.

Public resistance

Opposition from local Indigenous communities continues to intensify. BBC Indonesia reports that the Maya Indigenous group, whose ancestral lands encompass parts of Gag Island, feels their customary rights (hak ulayat) have been violated. They claim they were not properly consulted, with some residents alleging pressure to accept mining projects under the guise of development. The Maya people, who have long relied on the island's ecosystems for their livelihoods and cultural practices, fear that mining will endanger their access to clean water, traditional food sources, and the preservation of their culutural identitiy. Female leaders and community elders have been particularly vocal, raising concerns over intergenerational impacts on their way of life. 

Greenpeace Indonesia has emphasised that the resistance to nickel mining in Raja Ampat is not an isolated case. During their protest at the 2025 Indonesia Critical Minerals Conference, activists criticised Indonesia’s nickel strategy for prioritising downstream industrialisation at the expense of local communities and ecosystems.

The Indonesian Forum for the Environment (WALHI) echoed these concerns, citing similar cases in Wawonii, Halmahera, and Southeast Sulawesi. In Halmahera, open-pit mining and waste disposal have reportedly polluted rivers and displaced Indigenous communities, according to Mongabay. On Wawonii Island, nickel concessions have clashed with farming areas and residential zones, sparking years of protest and even arrests of local farmers. And in Morowali, Sulawesi, rapid industrial development tied to nickel smelters has raised alarm over air and water pollution, labour exploitation, and loss of biodiversity.

These patterns point to a broader national issue: resource extraction often outpaces environmental governance, with communities left to bear the social and ecological costs.

Unequal gains and regulatory gaps

Tempo reports that PT Gag Nikel asserts its compliance with licensing protocols and claims to hold a valid Environmental Impact Assessment (AMDAL). But according to Greenpeace and WALHI, the permitting process has lacked adequate public participation and fails to uphold the principle of Free, Prior and Informed Consent (FPIC) for Indigenous peoples.

There are also growing questions about the transparency of royalty distributions and the tangible benefits for local communities. Past experiences elsewhere suggest that economic gains are often captured by a handful of local elites or contractors, rather than reaching those most affected by mining activities.

The Mining Advocacy Network (JATAM)’s latest mapping highlights that Southwest Papua, with Gag Island at the forefront, has become a prime target for extractive industry expansion. In this context, policy inconsistencies are glaring: the protection of Raja Ampat’s world-renowned biodiversity appears negotiable when weighed against investment priorities.

Government steps in 

In early June, Indonesia cancelled four mining licences in Raja Ampat due to environmental concerns and the area’s ecological significance. The decision, led by Minister Bahlil Lahadalia under President Prabowo’s directive, followed on-site inspections and revealed that the permits overlapped with protected zones. The revoked licences belonged to PT Nurham, PT Anugrah Surya Pertama, PT KW Sejahtera Mining, and PT Mulia Raymond Perkasa.

Only PT Gag Nikel, operating since the 1970s, remains active, with limited land cleared and some areas already restored. Officials emphasised that no mining is taking place near key tourist spots like Paynemo. Authorities plan to rehabilitate affected sites and encourage a shift towards sustainable industries such as tourism and community-based fishing.

This is a positive and necessary move to protect a globally important ecosystem. Still, real progress will depend on consistent follow-through, not just policy announcements. Ongoing public involvement is crucial, as Indonesia has seen policies with good intentions lose their impact when oversight fades. That’s why environmental protections must also be extended to other islands that could face similar risks from mining activities in the future.

The unfolding situation in Raja Ampat highlights Indonesia’s broader struggle: how to lead the global green energy push without sacrificing its own environment - much like what has already happened in Halmahera, Wawonii, and Morowali, where the environmental cost of nickel extraction is being deeply felt.

Raja Ampat, with its unique marine biodiversity and cultural heritage, risks becoming the next casualty if current mining models are applied there.

Yes, nickel is essential for electric vehicles and batteries. But is it worth the ecological destruction? In the short term, EVs may benefit those with access. But once Indigenous land is lost, or reefs are destroyed, they are not easily restored - if ever. Sustainability must not come at the cost of the very ecosystems and communities we claim to protect.