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Divestment of 51 Percent Stake in Freeport Non-negotiatble: Luhut
The Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan. TEMPO/Yovita Amalia
Tuesday, 22 August, 2017 | 08:56 WIB
Divestment of 51 Percent Stake in Freeport Non-negotiatble: Luhut

TEMPO.CO, Jakarta - The Coordinating Minister for Maritime Affairs Luhut Binsar Pandjaitan has reiterated that the divestment of 51 percent stake in Freeport Indonesia is non-negotiable. The company is also required to build a smelting plant in the country within the next five years.

As the negotiation continues, Luhut believes that the two items will be agreed by the government and Freeport Indonesia. Another two items being negotiated are contract extension and investment stability.

Read: Indonesia - Freeport Negotiation to be Finalized

“[A negotiation] is ongoing; it’s impossible not to reach an agreement. Divestment of 51 percent stake and smelter issue are non-negotiable,” he said yesterday.

Luhut said that the government will not bow down to pressure from anyone, including Freeport, on the management of Indonesia’s natural resources. Nevertheless, the government will respect the existing contract of work (CoW) that will end in 2021.

As such, Papuan mines shall be handed over to Indonesia once the contract ends.

As for Freeport Indonesia’s request to extend its contract to 2041, Luhut said that it will be negotiated once an official agreement on divestment is reached.

Indonesian regulation holds that a mining operation permit may only be extended every 10 years, not 20 years as requested by Freeport. The company will have its contract expired in 2021 but it needs an extension to carry out its underground mining work.




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