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Grasberg’s large copper reserves promise large profits: Minister
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Workers operate mining equipment in an underground tunnel in the Grasberg Mine in Timika, Papau. (Courtesy of/PT Freeport Indonesia)
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nergy and Mineral Resources Minister Ignasius Jonan has said the enormous copper reserves in the Grasberg Mine in Papau will deliver large profits for Indonesia, after the country signed an agreement to gain control of the majority share of gold and copper miner PT Freeport Indonesia (PTFI).
The commodity was an important material used in the production of electric vehicles (EVs), which are being developed by many countries, the minister said.
“If demand for EVs jumps in the future, it will for copper. In the past three years, the price of copper has never decreased. The trend has consistently been up,” he added.
Previously, international energy watchdog the International Energy Agency (IEA) estimated that EV ownership would jump to around 125 million by 2030 from an estimated 3.1 million in 2017.
The government, which was represented by state-mining holding company PT Indonesia Asahan Aluminium (Inalum), inked a heads of agreement (HoA) to buy a majority stake in PTFI with Freeport-McMoran Inc (FCX).
The agreement was signed by Inalum president director Budi Gunadi Sadikin and FCX chief executive officer Richard Adkerson, last week. Under the agreement, Inalum will buy the shares at a total value of $3.85 billion.
Previously, Bloomberg Intelligence estimated that the reserves in the world’s biggest gold deposit and second-largest copper mine were worth about $14 billion. Indonesia accounted for 47 percent of Freeport’s operating income in 2017, according to data compiled by Bloomberg. (bbn)
