Freeport production hurt by strike, massive layoffs
Friday, July 7 2017 - 02:02 AM WIB
Bambang said on Thursday the company?s copper concentrates production now stands at 140,000-160,000 tons per day, lower than the company?s target of 190,000 tons per day. He added, that according to the company, daily output prior to the Idul Fitri celebration dropped to as low as 110,000 tons. Last year, copper concentrates production averaged 165,700 tons per day.
He said that the less than optimal production rate was primarily due to the lingering workers strike, which started in May, and the massive layoffs. PT Freeport, a subsidiary of US-based Freeport McMoRan Inc, has laid off more than 4,000 workers involved in the strike.
PT Freeport Spokesman Riza Pratama was quoted by Bisnis Indonesia as saying that the company had made the layoffs in accordance with existing regulations.
He also confirmed that the strike has affected the company?s copper concentrates production, but insisted that the current production rate remains in normal range. ?Production remains normal, shipment remains normal, and (mining) operations continue,? he said, but declined to provide further details.
PT Freeport has been engaged in ongoing negotiations with the government over its future mining operations at the Grasberg gold and copper mine in Papua Province. The company has asked for certainty that its current mining contract, which is set to expire in 2021, will be extended until 2014, and demanded investment stability among others by maintaining the current nailed down tax system as it plans multi-billion dollar of investment, while the government wants to apply a prevailing tax system and convert the company?s contract status into special mining business license from the current contract of work. The government has also demanded PT Freeport to build domestic smelter and to divest up to 51 percent shares to Indonesian investors, while the company insists to only divest up to 30 percent shares. (*)