Government provides dispensation for PT Freeport

The Ministry of Energy and Mineral Resources has provided dispensation for gold and copper giant PT Freeport Indonesia regarding requirement for progress evaluation of domestic copper smelter project of the company, Kontan reported on Saturday.

The paper quoted Bambang Susigit, Director of Mineral Management and Development at the ministry, as saying that PT Freeport has requested for an extra period of one week to appoint the required independent auditor to evaluate the progress of the smelter project. ?They (the company) requested for another week. We have summoned (Freeport),? he said on Friday.

PT Freeport, a subsidiary of US-based Freeport McMoRan Inc, obtained from the ministry recommendation letter on February 2017 for an export permit of 1.13 million tons of copper concentrates until February 17, 2018. Under a new government regulation introduced earlier this year, only mining firms which have commitment to build domestic smelter will be given export permit. The smelter project will be evaluated by an independent auditor every six months. Progress of the project must reach 90 percent of each six-month target. Failing to make significant progress will risk their export permit revoked.

PT Freeport has earlier said that while it is committed to develop the copper smelter, it will also depend on progress on ongoing negotiations with the government over the future of its mining operations in Papua. The company has among others demanded for certainty over its request to extend its mining contract, which is set to expire in 2021, until 2041 as it will invest at least US$2 billion in the smelter project, and $15 billion in underground mine. (*)