Indonesia, PT Freeport Indonesia agree on developing world’s largest underground mining site

Rappler.com
Indonesia, PT Freeport Indonesia agree on developing world’s largest underground mining site
The long-term investment plan focuses on continuing operations of the Grasberg Mining Complex past 2021

JAKARTA, Indonesia – The government of Indonesia and PT Freeport Indonesia, a premier US-based natural resources company, have reached an agreement to develop the world’s largest underground mining site.

The long-term investment plan focuses on continuing operations of the Grasberg Mining Complex past 2021.

“Following intensive communications and consultations with the country’s highest leaders, we agreed to provide assurances and prepare for a continuation of a $18 billion long-term investment,” said Sudirman Said, the Minister of Energy and Mineral Resources of the Republic of Indonesia.

Since 2014, PT Freeport Indonesia and the Government have been in negotiations to secure operations in the Province of Papua.

The points of negotiation included 11 points on the aspirations of the communities and local government of Papua. Those have been settled.

The remaining 6 points relate to the central Government, including the release of parts of the operations, principles of divestment, increased local components, development of a smelter, increased state royalties, and the legal status of ongoing operations.

“Following intensive communications and consultations with the country’s highest leaders, we agreed to provide assurances and prepare for a continuation of a USD 18 billion long-term investment.,” said Sudirman Said, the Minister of Energy and Mineral Resources of the Republic of Indonesia.

The government lauds the agreement as beneficial for the economic development of Papua and in the West Papua regions.

James R. Moffett, Chairman of Freeport McMoRan Inc, agreed.

“We are pleased with the Government assurances of legal and fiscal certainty and look forward to continuing our long term partnership and investment plans to advance the economy, jobs and economic velocity in Papua,” he said.

Since 2014, PT Freeport Indonesia and the Government have been in negotiations to secure operations in the Province of Papua.

From the 17 points of negotiation, 11 concern the aspirations of the communities and local government of Papua which now have been settled. While the remaining 6 points relate to the central Government, including: the release of parts of the operations, principles of divestment, increased local components, development of a smelter, increased state royalties, and the legal status of on-going operations.

Said said President Joko Widodo emphasized that 4 points be maintained for the agreement to take place: the benefits of the on-going operations of PT Freeport Indonesia need to be maximized as much as possible for the development of the metal industry in the Papua and West Papua region; PT Freeport Indonesia must continue in its efforts to involve local industry and develop human resources; yhe development of a smelter must be accelerated in accordance with agreements reached; and Indonesia must accelerate the improvement of the investment climate to attract new investors and to expand the investment already in the country.

The agreement comes as the government introduces stimulus measures to woo desperately needed investment, in its latest bid to boost the sliding rupiah and breathe new life into the slowing economy.

Freeport-McMoRan is the world’s largest publicly traded copper producer, and boasts an industry-leading global portfolio of mineral assets. Among its assets is the Grasberg minerals district in Indonesia, one of the largest copper and gold deposits in the world. – Rappler.com

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