Rio Tinto's share of Grasberg output up for copper, down for gold

Anglo Australian mining giant Rio Tinto announced that its share of production at the copper and gold Grasberg mines in Irian Jaya increased for copper and dropped for gold last year.

The company said in a financial statement obtained by Petromindo.Com that its share of the Grasberg mines' copper output increased by 13.5 percent to 203,800 tons, while its share of gold output was 21.5 percent lower at 735,000 ounces last year.

It said its holding in Freeport-McMoRan Copper & Gold, which controls the mines, has increased from 14.6 percent to 16.6 percent following a share buy-backs in 2000.

Freeport McMoran Copper & Gold, an American firm, owns 81.28 percent of PT Freeport Indonesia, which operates the Grasberg mines. The remaining shares are owned by the Indonesian government (9.36 percent) and PT Indocopper Investama Industries (9.36 percent).

Aside from the Grasberg mines, Rio Tinto also holds 50 percent shares in PT Kaltim Prima Coal (KPC), which operates a huge coalmine in Sangatta, East Kalimantan, and 90 percent shares in gold mining company PT Kelian Equatorial Mining (KEM), which operates a gold mine in Kelian, also in East Kalimantan.

The company is partnered with Beyond Petroleum (BP) (50 percent) in KPC and with local firm PT Harita Jayaraya (10 percent) in KEM.

It said its net earnings from KPC dropped to US$18 million in 2000 from $26 million in 1999.

"The impact of lower shipments, as a consequence of 44 days of lost production due to industrial disputes, and lower prices, accounted for the reduction in profit compared with 1999," the company said.

The company further said its share of losses from KEM increased to US$9 million in 2000, from $3 million in 1999.

"Production was lower at Kelian in Indonesia in the first half of 2000, as mining activities were suspended from April until mid-June as a result of a dispute over land compensation claims, but production recovered in the second half," the company said. (Bodega)