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Govt to hike copper export levy after Freeport smelter fire

The government will slap a higher export tax on future copper shipments by PT Freeport Indonesia (PTFI) after a fire late last year halted operations at its new smelter in Gresik, East Java.

Ruth Dea Juwita (The Jakarta Post)
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Thu, February 20, 2025 Published on Feb. 19, 2025 Published on 2025-02-19T15:46:47+07:00

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Govt to hike copper export levy after Freeport smelter fire Coordinating Economic Minister Airlangga Hartarto (right), PT Freeport Indonesia (PTFI) president director Tony Wenas and Investment Minister Bahlil Lahadalia visit the new smelter in Gresik, East Java, on June 27, 2024. (PT Freeport Indonesia (PTFI) )

T

he government will slap a higher export tax on future copper shipments by PT Freeport Indonesia (PTFI) after a fire late last year halted operations at its new smelter in Gresik, East Java, Energy and Mineral Resources Minister Bahlil Lahadalia said on Wednesday.

“We will impose a penalty by raising the export tax [to make it] higher than before,” Bahlil told reporters on the sidelines of the Indonesia Economic Summit hosted by the Indonesia Business Council at the Shangri-La hotel in Jakarta.

The government would allow the company to resume copper concentrate exports “in stages”, but with penalties, Bahlil said, explaining that the definitive rate would be set later this month.

Read also: Freeport ‘ready’ to export 1.3m tonnes of copper concentrate this year

The October fire temporarily halted PTFI’s production, forcing the copper and gold miner to suspend copper concentrate exports ever since.

Previously, the miner had committed to paying a 7.5 percent export duty on any shipments made under the waiver, while the government has urged the company to accelerate repairs at the US$3 billion Gresik copper smelter, according to United States-based Freeport-McMoRan (FCX), which controls its operations.

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The decision had been made in a limited meeting led by President Prabowo Subianto recently, Bahlil said, with the aim of finding a “win-win solution” to keep operations running and state revenue flowing.

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