Freeport to process 58% of production in local smelters

PT Freeport Indonesia (FI) will process at least 58 percent of the company?s copper and gold ores and concentrate in local smelting plants as part of the company?s commitment to comply with the new mining regulation which will no longer allow exports of unprocessed metal ores beginning 2014.

Freeport?s president Rozik B Soetjipto as quoted by Investor daily said that at present about 42 percent of copper and gold ores production had been processed in PT Smelting Gresik in East Java, which is 25 percent owned by the company.

?About 42 percent of ores/concentrate are processed in Smelting Gresik because their specifications were suitable with its smelter,? he said.

He added that the other 58 percent were still processed in smelting plants overseas because local smelters were still unable to meet their specifications.

In order to be able to process at least 58 percent of ores/ concentrates in Indonesia, the company has prepared two options. The first is to increase the capacity of Smelting Gresik?s smelter, and the second option is to cooperate with other smelting companies.

?For the second option, two local firms ? Nusantara Infrastruktur and Indosmelt -- have contacted us,? he said. ?But we have not met them. We have to know their feasibility study,? he added.

He said expanding the processing capacity of Smelting Gresik would not be feasible because the plant could be expanded only by between 10 and 15 percent, too small to meet the projected sharp increase in Freeport?s copper and gold production.(*)