R/€ = 14.81 Change: 0.15
R/$ = 12.57 Change: 0.12
Au 1293.40 $/oz Change: 11.06
Pt 908.00 $/oz Change: 29.05
 
 
R/€ = 14.81 Change: 0.15
R/$ = 12.57 Change: 0.12
Au 1293.40 $/oz Change: 11.06
Pt 908.00 $/oz Change: 29.05
 
 
BACK

Indonesia hopes to finalise Freeport contract talks by June

11th January 2018 BY: Reuters

JAKARTA – Indonesia hopes to finalise contract talks with Freeport McMoRan over the Grasberg copper mine by June, although divestment issues are still unresolved, a mining ministry official said on Thursday.

Indonesia and Freeport formed a framework agreement in August to transfer the company's rights to Grasberg to a new mine license system from an existing contract of work. Under the change, Freeport promised to divest 51% of its Indonesian unit to the government.

Advertisement

However, details of the divestment still need to be ironed out by Freeport, the State Owned Enterprises Ministry and the Finance Ministry, Bambang Gatot, the Coal and Minerals Director at the Energy and Mineral Resources Ministry, told reporters.

"The main issue that hasn't been resolved yet is divestment," Gatot said.

Advertisement

Other issues under consideration include the development of another domestic copper smelter, an investment stability agreement and the extension of Freeport's operations up to 2041, he said.

State-owned mining holding company PT Inalum has been appointed by the government to acquire the Freeport stake.

Grasberg is the world's second-biggest copper mine and is located in the eastern Indonesian province of Papua.

The divestment may involve liquidation of a joint venture that Freeport Indonesia (PT-FI), operator of Grasberg, has with Rio Tinto.

Under a joint venture formed in 1996, Rio has a 40% interest in PT-FI's Grasberg contract, which entitles them to a 40% share of all production after 2022. Rio has held talks with Indonesia about a possible exit to the venture.

Freeport exported 921 000 t of copper concentrate in 2017, and has a quota to ship up to 1.1-million tonnes through to February 16. 

EDITED BY: Reuters
EMAIL THIS ARTICLE SAVE THIS ARTICLE