Freeport Calls to Extend Copper Concentrate Export License in Indonesia
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28 March 2024 15:44 WIB
TEMPO.CO, Jakarta - President Director of Freeport Indonesia Tony Wenas highlighted the urgency of extending the government's copper concentrate export license.
The statement was conveyed by Tony together with Freeport McMoran Chairman & CEO Richard C Adkerson and Freeport-McMoran CFO Kathleen L. Quirk after meeting with President Joko Widodo or Jokowi at the Presidential Palace on Thursday, March 28, 2024.
When asked if he discussed the matter with Jokowi during his meeting, Tony said “The discussion will be at the ministerial level, not with the president”.
Tony only stressed that the relaxation of concentrate export licenses was important to ensure no decline in state revenue. "If we cannot export, state revenues will also decrease by approximately US$2.2 billion or around Rp30 trillion at current prices," said Tony. In his calculations, the loss could occur from June to December 2024.
Previously, in an interview with Tempo, Tony explained that without export relaxation, Freeport would reduce production value. For example, copper production, originally 1.7 billion pounds, will be reduced to 1.4 billion pounds. Gold will be reduced to 1.6 million ounces from the normal 2 million ounces.
Freeport hoped that the copper concentrate export license would remain open. The company should not have been able to export copper concentrate since last year because the government banned the export of a number of raw minerals starting June 10, 2023, to encourage the increase of the added value of minerals in the country.
However, Freeport along with three other companies was exempt from the policy since they have completed over half of their smelter construction.
Freeport may export copper concentrate until May 31, 2024, with a penalty of 20 percent of the total value of raw mineral sales abroad each period. The company must also pay an export duty of 7.5 percent.
As for the meeting with Jokowi today, Freeport officials said they had also discussed the progress of the smelter in Manyar, Gresik, East Java. In a statement after the meeting, Freeport promised that the facility is expected to operate this year.
"The smelter progress has reached 92 percent with the expectation to complete this May and will soon operate starting June this year," Tony said.
Construction of the Freeport smelter in Gresik began in 2018. The plant is expected to process 1.7 tons of concentrate per year and produce 600 tons of copper cathode per year.
DANIEL A. FAJRI | VINDRY FLORENTIN
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