Thousands of PT Freeport contractors? workers join strike
Thursday, May 11 2017 - 05:42 AM WIB
News portal kompas.com quoted Philpus Badii, a local labor leader, as saying that the number of workers participating in the strike is estimated at 6,000-7,000, and was set to increase further.
He said that the workers will continue with the strike until the PT Freeport management fulfill the workers? main demand of re-employing fellow workers who have been suspended, and to stop further suspension of workers.
As has been previously reported, around 1,700 permanent workers of PT Freeport, which operates the giant Grasberg mine in Papua, started on May 1 a month-long labor strike, significantly affecting the company?s production.
PT Freeport Spokesman Riza Pratama said on May 2 that due to the strike, the company?s ore production dropped by around half of the normal production rate. ?The production decline is around 50 percent of the normal production rate of 180,000 tons of ore per day,? Riza said.
He said that the workers primarily are demanding the company to resume employing workers which have been suspended. But Riza said that the suspension policy was made as part of efficiency strategy pending completion of ongoing negotiation with the government over the company?s long-term operation including on the extension of its current mining contract. Negotiation talks with the government is expected to be concluded in October.
PT Freeport suspended export in January after the government introduced a new regulation requiring the company to convert its mining permit status from the current mining contract of work (COW) to special mining business license (IUPK) as part of conditions to continue export of copper concentrates. The export suspension had forced the company to suspend some workers as its production of copper concentrates can only be absorbed by PT Smelting, which operates the only copper smelter in the country.
PT Freeport, a local subsidiary of US Freeport McMoRan Inc, has been locked in lengthy negotiation process with the government as the company demanded the IUPK permit to have similar fiscal and legal terms as set in the COW including a nailed-down tax principle to help ensure its investment stability. The company is also seeking to extend its current operation as the new regulation requires the company to divest up to 51 percent stake to Indonesian investors.
The government last month issued a temporary IUPK for PT Freeport to allow the company to resume export of copper concentrates. The government gave an export permit valid until February 2018 with an export quota of 1.1 million tons. PT Freeport resumed export on April 21 at a volume of 22,000 tons to China and 22,000 tons to Japan. (*)