PT Freeport suspends senior employees

Courtesy of Freeport

Gold and copper giant PT Freeport Indonesia has suspended production activity at its underground mine in Papua as the company has been unable to make export since January 12, forcing the company to also start workers suspension.

Kontan quoted PT Freeport Spokesman Riza Pratama as saying on Wednesday that 25 senior employees have been suspended. ?There are 25 people at the level of senior vice president or senior staff have been suspended,? Riza told the paper.

PT Freeport also said it has informed its mining contractors to change the mine operation plan and prepare measures for reducing the number of workers. PT Freeport employs around 32,000 workers.

The government introduced last month new regulations allowing mining firms to continue export of mineral concentrates for another five years under certain conditions including the conversion of their mining permit status from mining contract of work (COW) to special mining business license (or IUPK), and commitment to develop domestic smelters within five years.

PT Freeport has agreed to convert its COW into IUPK but demands certain conditions including a nailed-down tax system in the IUPK as it has enjoyed under the COW regime. The government late last week issued the IUPK for PT Freeport, but the company said that the government has yet to agree on the conditions requested by the company.

Meanwhile, Director General of Mineral and Coal Bambang Gatot Ariyono said on Tuesday that PT Freeport is expected to be able to resume export of copper concentrates next week if the recommendation letter for export from the Ministry of Energy and Mineral Resources has been issued.

He did not specifically said whether the government would finally bow to the conditions demanded by PT Freeport. (*)