An official at the Energy and Mineral Resources Ministry has confirmed that the temporary special mining permit (IUPK), one of the required documents that allows gold and copper miner PT Freeport Indonesia (PTFI) to export coal concentrates, will expire on July 4.

“Yes, [the IUPK] will expire. Logically, it should be extended. But I do not know the requirements, [so] just wait for a statement from the director general,” the ministry's business supervision director, Bambang Susigit, said on Sunday in Jakarta, referring to mineral and coal director general Bambang Gatot Ariyono as quoted by tribunnews.com.

The government issued a temporary IUPK for Freeport in December 2017 because the two sides had failed to complete their negotiations on the fate of PTFI's Grasberg gold and copper mine in Papua.

The temporary IUPK was issued to allow PTFI to continue exporting its coal concentrates products without canceling its old contract of work (CoW), which was signed in 1991, although Government Regulation No. 1/2017 on mineral and coal mining activities required the company to do so.

PTFI objected to changing its contract and the government took a soft approach in negotiating with company, particularly on divesting 51 percent of Freeport’s shares to Indonesian entities as required by existing laws. Under the new regulation, Freeport and other miners are also requited to construct smelters.

Bambang Susigit said Freeport could extend its temporary IUPK, but the government needed to verify progress in the company’s commitment to the terms that had been agreed, including construction on the smelter. (bbn)