Papuan Enterprises to Acquire 40 Percent of Freeport Shares

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  • Indonesia's Finance Minister Sri Mulyani Indrawati (C), Freeport McMoRan Chief Executive Officer Richard Adkerson (L) and Indonesia's Energy and Mineral Resources Minister Ignasius Jonan chat before the start of a news conference at the Ministry of Energy and Mineral Resources in Jakarta, Indonesia August 29, 2017. Indonesia is allowing Freeport-McMoRan to continue operating a giant gold and copper mine after the U.S. company agreed Tuesday to relinquish majority ownership of it to the government. REUTERS/Darren Whiteside

    Indonesia's Finance Minister Sri Mulyani Indrawati (C), Freeport McMoRan Chief Executive Officer Richard Adkerson (L) and Indonesia's Energy and Mineral Resources Minister Ignasius Jonan chat before the start of a news conference at the Ministry of Energy and Mineral Resources in Jakarta, Indonesia August 29, 2017. Indonesia is allowing Freeport-McMoRan to continue operating a giant gold and copper mine after the U.S. company agreed Tuesday to relinquish majority ownership of it to the government. REUTERS/Darren Whiteside

    TEMPO.CO, Jakarta - Energy and Mineral Resources (ESDM) Minister Ignasius Jonan announced that the State Owned Enterprises, that are appointed by the government in the Freeport Indonesia divestment, will acquire Rio Tinto’s right in the cooperation management of the Grasberg mine and Freeport Indonesia.

    In his explanation with the Commission VII House of Representatives on Tuesday, December 5, Jonan said that the negotiation process is currently hampered by Rio Tinto’s acquisition value. He suggests that the SOEs appointed by the government, Regional Owned Enterprises (BUMD), together with appointed Papuan tribes will acquire 40 percent of Rio Tinto’s participation rights.

    Read: SOE Holding Will Have Enough Funds to Acquire Freeports Shares

    Rio Tinto partnered with Freeport-McMoran to manage the Grasberg mine in Papua since 1995. Rio Tinto’s 40 percent shares include the mine’s operations, technicalities, explorations, mine developments, and tailing management.

    “Forty percent of Rio Tinto’s participating interest will be acquired by SOEs that are appointed by the Indonesian government together with regional owned enterprises and major tribes that are linked to the operations of Freeport Indonesia,” said Minister Jonan.

    Jonan also announced that the 9.36 percent share by Indocopper Investama that is fully owned by Freeport-McMoran will also be acquired by the Indonesian Government to fulfill the 51 percent acquisition. The minister suggests that the divestment will be completed in 2018.

    BISNIS.COM