Investors approaching critical minerals tend to spend their diligence effort on the resource: grade, tonnage, strip ratio, metallurgy. That work is necessary and it is usually done well, because it is the part of the problem with an established discipline behind it.
It is also, in practice, rarely where transactions come apart. The resource is the most studied and least ambiguous element of the opportunity. The elements that decide the outcome are the ones surrounding it.
The licence is a chain, not a document
A mining title is meaningful only if the chain behind it holds: how it was issued, how it has been maintained, what obligations attach to it, whether those obligations have been met, and whether the party presenting it holds what they represent themselves as holding.
Each link is verifiable. The failure mode is not usually forgery; it is a chain that is partially documented, partially assumed, and presented as complete. An opportunity that resists straightforward verification of its own licence history has answered the important question already.
Counterparty standing is part of the asset
Resource transactions are relationship-dense. The counterparty's actual position - what they control directly, what they control through others, what they have committed elsewhere, and what their track record is on delivering the sort of undertaking now being offered - is not background colour. It is a material term of the transaction.
Where a party's representation of their own position cannot be corroborated independently, the correct inference is not that the opportunity is smaller. It is that the opportunity has not yet been assessed.
Downstream is an infrastructure business
Policy has pushed value toward domestic processing, which is a genuine opportunity and a different business from extraction. Processing is capital-intensive, power-intensive and infrastructure-dependent. Its economics turn on inputs that have little to do with the orebody: firm power at industrial scale, logistics, port and materials handling, utilities, and an offtake arrangement credible enough to finance against.
An investor evaluating a downstream opportunity is, in substance, evaluating an industrial infrastructure project that happens to have a resource attached. Diligence framed only around the resource will miss most of what determines the return.
The practical order of work
A useful sequence inverts the conventional one. Establish the integrity of the licence and the standing of the counterparty first, because they are cheap to test and they determine whether anything else is worth doing. Establish the processing, power and offtake pathway second, because it governs the economics. Refine the resource case last, because it is the part most likely to be adequate already.
This is not scepticism about the sector. Indonesia's position in these supply chains is real and durable, and there is genuine opportunity in it. It is an argument that the opportunity is won or lost on the parts of the transaction that receive the least structured attention - and that those parts are, fortunately, the ones most amenable to being checked.