PTFI expects the government to approve its request for a bigger export quota in the third quarter. The expectation came after the company opened an additional mining area in the Grasberg open pit in the second quarter as it enters the final phase of mining the open pit.

“PTFI will continue to monitor geotechnical conditions to determine the extent of mining in the Grasberg open pit,” US mining giant Freeport-McMoRan (FCX), which owns a 48.76 percent stake in PTFI, wrote in a statement on Wednesday.

The transition from open pit to underground mine is taking place this year and is expected to produce large scale quantities of copper and gold from the high-grade underground ore bodies.

“We are pleased to report that the executive of the underground ramp-up at Grasberg is advancing according to plan and recent milestones are encouraging as we target increasing volumes and cash flow from the Grasberg minerals district,” said FCX president and CEO Richard C. Adkerson.

PTFI utilized its approved export quota of 180,000 tons of concentrate in the first half for the current export period that expires March 8, 2020, the company noted.

The proposed additional export quota stands at around 200,000 tons of concentrate, according to the Energy and Mineral Resources Ministry’s director general for minerals and coal Bambang Gatot Ariyono.

“They also proposed for additional exports of copper concentrate in line with additional output,” he said, adding the decision will be made in August.

No details were unveiled on the expected additional output from the Grasberg mine, although PTFI previously expected to produce less due to the transition from the open pit to underground mines, namely the Grasberg Block Cave underground mine and the Deep Mill Level Zone (DMLZ).

PTFI concentrate output this year is expected to reach 1.3 million tons, of which 200,000 tons are for the export market and the rest to be channeled into local copper smelter PT Smelting in Gresik, according to government data.

“The production was down to around 1.3 million tons of concentrate from 2.2 million tons last year due to the operational shift to the underground mine from an open pit,” the ministry’s director for minerals, Yunus Saefulhak, said in March.

The lower output this year translated into PTFI’s gold and copper sales as of June that only reached half the amount the company booked in the same period last year.

PTFI copper sales in the first six months of 2019 stood at 325 million pounds or 48 percent lower year-on-year (yoy). The lower sales in copper were in line with the decrease in its production at only 270 million pounds of copper, or 58.9 percent lower.

Gold sales of PTFI also slid 67.03 percent to 420,000 ounces in the first half this year compared with the same period last year. Gold production dropped 76.3 percent to 316 million ounces of gold.

Until December, FCX estimated that the PTFI’s consolidated copper and gold sales volumes will stand at 600 million pounds of copper and 800,000 ounces of gold.

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