Freeport?s export hampered by L/C requirement

Gold and copper giant PT Freeport Indonesia, a subsidiary of US-based Freeport McMoRan Copper & Gold Inc, has been forced to suspend export of copper concentrates as the Ministry of Trade has yet to approve the company?s request for another delay in implementing the required letter of credit (L/C) payment system, reports said on Tuesday.

Company spokesman Riza Pratama was quoted as saying that the company had last week applied with the Ministry of Trade for another delay in implementing the required L/C payment system. ?We?re still waiting (for approval) from the Ministry of Trade. We hope to be able to resume export soon,? he said.

The Ministry of Trade earlier this year issued a new regulation requiring the use of the L/C payment system in the export of the country?s key commodities including mining products. A number of firms, however, have sought for a dispensation as they needed more time to make adjustment with the overseas buyers. The ministry granted PT Freeport a six-month delay in implementing the L/C requirement, the permit of which expired July 25, the same as the expiry date of its six-month export permit.

The Ministry of Energy and Mineral Resources last month provided recommendation for PT Freeport to renew its export permit, which expired July 25, for another six months as the company was seen to have fulfill a number of requirements set by the government.

PT Freeport would be given an export quota of 775,000 tons of copper concentrates, said Director General of Mineral and Coal Bambang Gatot. (*)