Freeport told to contribute more to Papua as export permit extended
Monday, January 26 2015 - 12:47 AM WIB
Minister of Energy and Mineral Resources Sudirman Said told a press conference Sunday that the government wants PT Freeport, a subsidiary of US-based Freeport McMoRan Copper & Gold Inc, to not only provide higher revenue for the local government, but also recruit more local people and develop downstream industry in Papua.
The requirement for the company to provide greater economic contribution in Papua is part of a new clause included in the MoU on the amendment of the company?s mining contract of work. The company first signed the MoU, agreeing to a number of changes proposed by the government, in July of last year. The company, however, failed to meet the July 25 deadline in completing the amendment of the contract.
Sudirman said the government has extended the deadline of the MoU for another six months, adding the new clause on economic contribution to Papua.
The extension of the MoU has allowed PT Freeport to obtain an extension of the permit to export copper concentrates despite slow progress in developing the required domestic smelter.
Freeport said last week that it has signed an MoU with state-owned fertilizer firm PT Petrokimia Gresik to lease an 80 ha land in Gresik, East Java, belonging to the latter firm as location for its planned copper cathode smelter.
?The copper concentrate export will be conducted in accordance with the prevailing laws and regulations. We will continue to explore possibilities of building smelter facility in Papua or industry related facilities subject to comprehensive feasibility studies. In the meantime, while waiting for the planning and preparation of infrastructures in Papua, PTFI is preparing a location in Gresik, East Java to build its additional smelter facility. We are working with State Owned Enterprise such as Petrokimia Gresik on the site location,? said newly appointed President Director of PT Freeport, Maroef Sjamsoeddin in a statement obtained Monday.
?PTFI will make every effort to bring about increased benefits and added value to the Republic of Indonesia, local community, our employees, and our shareholders, in line with national aspirations as we are finalizing the Contract of Work Amendment,? Maroef added.
Editing by Reiner Simanjuntak