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Jakarta Post

Freeport still seeks contract extension to 2041

  • News Desk

    The Jakarta Post

Jakarta   /   Wed, July 26, 2017   /   05:33 pm
Freeport still seeks contract extension to 2041 A vehicle passes through gold and copper mining company PT Freeport Indonesia’s mining area in Grasberg, Mimika, Papua. (JP/Nethy Dharma Somba)

Gold and copper mining company PT Freeport Indonesia is still seeking a contract extension to 2041 as its representatives are negotiating with the government about the conversion of its Contract of Work (CoW) agreement into a Special Mining License (IUPK).

Meanwhile, the government has offered Freeport an extension of its operational permit until 2031 as long as the company agrees to switch to the IUPK scheme.

Freeport Indonesia vice president corporate communications Riza Pratama said the contract extension until 2041 was needed so that Freeport could meet the requirements set by the government.

Read also: Indonesia, Freeport still differ on IUPK scheme

“[The extension is needed] so that we can invest US$15 billion for improving our underground mining and $2.3 billion for constructing the smelter as well as for a tradeoff of the divestment scheme,” said Riza in Jakarta on Wednesday, as reported by kompas.com.

Apart from being required to construct a smelter, the company is also required to divest 51 percent of its shares to Indonesian entities.

Riza said Freeport Indonesia, a subsidiary of United States-based mining giant Freeport-McMoRan, and the government were still negotiating.

“We are negotiating those issues with the government. All of the issues are negotiated as one package,” he stressed. (bbn)