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Freeport Indonesia warns of 20% revenue drop unless govt lifts export curb
Copper miners are waiting for another relaxation of export curbs until the end of this year, with the previous one ending in May.
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PT Freeport Indonesia's Manyar copper smelter and refinery in Gresik, East Java, on Feb. 29, 2024. (JP/Divya Karyza)
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old and copper mining company PT Freeport Indonesia (PTFI) warned the government over potential losses to the company’s income, including a knock-on effect on state revenue, unless the country extended its relaxation on export curbs until the end of this year.
PTFI, which is majority owned by the Indonesian government but operated by United States miner Freeport-McMoran, expects revenue to drop by 20 percent year-on-year (yoy) to US$7.4 billion this year if the relaxation on export curbs ended in May, as planned by the government.
Temporarily extending it would instead raise the figure by 23.5 percent yoy to $11.5 billion this year, according to PTFI presentation material shown to lawmakers of House of Representatives Commission VII, which oversees energy, minerals and industry.
Consequently, the government may only collect $2.9 billion in state revenue from the company under the existing conditions, whereas extending the relaxation would net state coffer almost double that amount.
“We are grateful that the government is considering granting [PTFI] the export permit for the June-December 2024 period,” PTFI deputy president director Jenpino Ngabdi Rapi said in Jakarta on Monday.
Read also: Freeport could face $502m fine for smelter delay, BPK says
The government was due to ban exports of copper concentrate starting June last year, but it allowed PTFI and PT Amman Mineral International to continue their shipments until May this year while their smelters were being completed.
