Freeport targets Grasberg ramp-up, long-term extension to support output growth

By Romel S. Gurky

Freeport-McMoRan said efforts to restore operations at its Grasberg mining complex are progressing, with production ramp-up expected from the second quarter and most of the site targeted to return to normal output in the second half of 2026.

Speaking at the BMO Global Metals, Mining and Critical Minerals Conference on Feb. 23, Chief Executive Kathleen Quirk said mud removal and installation of protective barriers in underground areas affected by a previous incident had been largely completed. Work to reinstall communications and electrical systems is expected to finish by March.

The company plans to restart production in the PB2 and PB3 block cave areas in the second quarter, with about 85% of Grasberg’s operations restored by the second half of the year. Smaller mining areas PB1 South and PB1C are scheduled to resume in 2027, which would mark a return to full production.

Freeport also said its new smelter remains on standby following a previous fire, but is expected to begin receiving concentrate in the second half of 2026 as mine output recovers. A separate smelter continues to process concentrate during the interim period.

Read also: Freeport targets Grasberg restart in Q2 2026 after Q4 output drop

The company recently signed a memorandum of understanding with the government to extend mining rights at Grasberg beyond 2041, allowing planning based on the life of the resource rather than a fixed license period. The operating license would be reviewed every 10 years for administrative purposes.

The extension is expected to support long-term production growth, including further exploration drilling and development of the Kucing Liar deposit, which Freeport said has mine life extending well beyond 2041.

Freeport noted that gold byproduct revenues from Grasberg offset production costs, resulting in a net credit position for its Indonesian operations within the company’s global cost structure. The portfolio’s average unit cost was about US$1.65 per pound in 2025 and is projected to rise to US$1.75 in 2026 before declining as Grasberg production ramps up.

The company added that continued automation, risk management and water handling improvements at Grasberg are expected to enhance safety while maintaining cost competitiveness as operations normalize.

Editing by Alexander Ginting