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* Ban on unprocessed mineral exports hit revenue last year
* Indonesia seeking to entice money back after uncertainty
* Govt push to resolve mining disputes, renew energycontracts
* Policy risks remain as president lacks parliamentarymajority
By Michael Taylor
JAKARTA, June 23 (Reuters) - Nationalistic policies imposedby Indonesia's previous administration - including a ban onunprocessed mineral exports - threw the resources sector intoturmoil last year.
Now, there are signs under President Joko Widodo that thegovernment is trying to mend fences with wary investors andentice more money back into resources.
Indonesia's resources sector contributed about 12 percent ofGDP last year, or about $101 billion, but investment slipped andthe ban on exporting minerals cost $6 billion in lost revenue.
The government now plans to relax parts of the ban, as wellas pushing to resolve some protracted mining disputes anddealing with a backlog of expiring energy contracts that havefrustrated foreign investors.
"There are still lots and lots of difficult hurdles toovercome, but we are seeing something of a change in mindset andthat's good news," said mining law expert Bill Sullivan, foreigncounsel at Christian Teo Purwono & Partners.
The more open approach was on show at a recent global coalconference in Bali, where Indonesia's energy and miningminister, Sudirman Said, candidly answered questions on a hostof issues concerning the packed auditorium after his speech.
Indonesia is a top producer of metals such as copper, aswell as coal and gas, but foreign firms often complain aboutlegal uncertainty, red tape and haphazard implementation ofpolicies.
This policy uncertainty came to a head last year whenJakarta pressed on with the ban on mineral exports, even thoughthere was not enough smelting capacity yet to process shipments.
While supporting the plans, Widodo's government now admitsthere were mistakes implementing them and is looking to pushback a 2017 deadline banning copper concentrates exports andcould ease its ban on bauxite exports.
DISPUTES
Widodo, who took office in October, will need to win thetrust of the industry to meet a target of increasing miningrevenue by about 50 percent this year to support a flaggingeconomy.
Indonesia's foreign direct investment in mining slipped to$4.67 billion last year from $4.82 billion.
According to a source familiar with the negotiations,London-listed Churchill Mining is in talks with thegovernment aimed at reaching a settlement in a long-runningarbitration dispute over the licensing of a Borneo coal project.
The government and Freeport-McMoRan Inc also saidthis month that they were closer to agreeing a new contract tooperate the U.S. miner's giant Papua copper mine after earlierthreats to remove its permit over a smelter dispute.
Still, enticing investment at a time when most commodityprices have slumped won't be easy, particularly withoutco-ordinated policy making.
"Among high level officials in the government, they stilldon't have a consensus," said Tato Miraza, former CEO atstate-owned miner Aneka Tambang.
The mining and energy ministry says it is holding regularmeetings with other ministries, state-owned enterprises andindustry bodies in a bid to fix this.
OBSTACLES TO REFORMS
The government has also been pushing plans to overhaulIndonesia's oil and gas sector and tackle a so-called "oilmafia" accused of skimming money in oil deals.
But Widodo still faces obstacles to his policies,particularly since he lacks a majority in parliament, as well asfacing legal challenges from Muslim groups such as Muhammadiyahover private participation in the oil, gas and water sectors.
Nonetheless, in another sign that issues are being fixed,Indonesia last week said it would allocate Total andJapan's Inpex a 30 percent stake in the Mahakam oil andgas block once the French major's operating rights to thecountry's top gas field expire in December 2017.
The decision resolves a more than seven-year tussle over theblock, and follows calls for it to be handed over entirely tostate-owned energy firm Pertamina. (Additional reporting by Gayatri Suroyo, Bernadette Christina,Fergus Jensen and Wilda Asmarini; Editing by Ed Davies)
