Government likely to renew Freeport?s export permit

Despite lack of significant progress in the development of the required domestic copper smelter, the government is likely to approve a request by gold and copper giant PT Freeport Indonesia for a renewal of its current export permit, which is set to expire today.

This was said by Director General of Mineral and Coal at the Ministry of Energy and Mineral Resources (MEMR), Bambang Gatot Ariyono. He said that the directorate is still finalizing the evaluation process of the PT Freeport request, the ministry is likely to recommend a five-month export permit for the company, instead of the usual six-month export permit. PT Freeport must obtain the recommendation letter from the ministry to be able to get permit for the export of copper concentrates from the Ministry of Trade. The MEMR is expected to give the recommendation letter early this week.

Bambang said that the existing Minister of Energy and Mineral Resources Regulation No 1/2014 bans the export of mineral concentrates including copper concentrates starting January 12, 2017 as part of efforts to push for the development of domestic smelters to allow the country to generate greater value from mineral concentrates.

PT Freeport plans to develop a copper smelter in Gresik, East Java, but progress reportedly has been very limited, raising concerns whether the company could meet the January 2017 deadline when copper concentrates could no longer be exported.

PT Freeport has applied for an extension of its current export permit, seeking for a copper concentrates export quota of 1.42 million tons, up from the current quota of 1.03 million tons.

Meanwhile, Director of Mineral Development and Management at the Ministry of Energy and Mineral Resources, Mohammad Hidayat said that the ministry is currently evaluating alternative regulations to help deal with the expected problems as the January 2017 deadline for smelter development approaches. ?We?re still thinking of what kind of regulation is appropriate,? he told Bisnis Indonesia. (*)