T

hree days before the expiry of its export permit, the Freeport McMoRan Inc. chairman took time to visit Jakarta and meet senior officials with the Energy and Mineral Resources Ministry in an apparent lobbying attempt to help his company'€™s Indonesian unit avoid a possible export halt imposed by the government.

Freeport McMoRan Chairman James Moffett, a 76-year-old businessman known in various countries for his prowess in lobbying, arrived at the Energy and Mineral Resources Ministry on Thursday evening. He was accompanied by the newly appointed Freeport Indonesia president director, Maroef Sjamsoeddin.

Moffett visited the ministry two days after Energy and Mineral Resources Minister Sudirman Said said the government would revoke Freeport Indonesia'€™s export permits as the company had yet to show progress in its smelter development.

No decision on the export permit was reached during Thursday'€™s meeting according to the Energy and Mineral Resources Ministry'€™s director general for minerals and coal, R. Sukhyar, who also attended the meeting. Another meeting is scheduled for Friday.

'€œThey said they had already signed an agreement for a plot of land for the smelter, however we need a stronger message. Moreover, one point in the agreement says it is not binding. We cannot accept that,'€ Sukhyar said, adding that Moffett put forward many arguments during the meeting.

Both Moffett and Maroef avoided journalists when they left the meeting.

The government is asking Freeport Indonesia to build a smelter in the country as a consequence of the 2009 Mining Law. Under the law, which is attempting to encourage development of the downstream industry, mining firms are required to process and refine minerals before selling them overseas.

Under a memorandum of understanding (MoU) signed last year, Freeport Indonesia has principally agreed to several adjustments to its domestic contract of work. One point is related to its commitment to smelter development.

This helped the company obtain a permit to export its copper concentrate, which is necessary following the ban on mineral ore exports imposed by the government effective Jan. 12. The export permit is only valid for six months and extensions will only be granted if mining firms show progress in smelter development. Under the regulation, the progress will be linked to the amount of investment the mining firm has to spend. Freeport Indonesia'€™s export permit will expire on Jan. 24.

Freeport Indonesia, the country'€™s biggest copper miner, had yet to make any progress or decide on basic matters such as the smelter location by earlier this week. This slow progress triggered Sudirman to threaten to freeze the firm'€™s export permit.

Earlier on Thursday, Maroef said that his company was about to sign an agreement to procure land for the company'€™s smelter. The land is owned by PT Petrokimia Gresik in East Java and is close to the only copper smelter in the country, operated by PT Smelting Gresik.

'€œWe need to process it because we cannot do this alone. There are many parties involved in determining the location,'€ Maroef told reporters.

Sudirman deplored Freeport Indonesia'€™s last minute attempts.

'€œI am unhappy that they only respond when we pressure them. This is a long-term issue, so everything needs certainty,'€ Sudirman said earlier on Thursday.