Indonesia fixes Newmont deadline for deal with Freeport’s copper smelter

2 March 2015 (Last Updated March 2nd, 2015 18:30)

Indonesia's Mines Ministry official has announced that Newmont Mining has to sign an agreement with Freeport-McMoRan to invest in the latter's $1.5bn copper smelter in Papua province, to get renewal for its copper export permit in the country beyond 19 March.

Indonesia's Mines Ministry official has announced that Newmont Mining has to sign an agreement with Freeport-McMoRan to invest in the latter's $1.5bn copper smelter in Papua province, to get renewal for its copper export permit in the country beyond 19 March.

Indonesia is said to be holding discussions with various mining companies with regard to their plans to develop smelting and processing facilities in the country.

Reuters quoted Coal and Minerals director-general R Sukhyar at a news conference as saying: "For an export permit extension for Newmont, we are still awaiting an agreement between Freeport and Newmont.

"For an export permit extension for Newmont, we are still awaiting an agreement between Freeport and Newmont."

"It will depend how serious Newmont's commitment to co-operate with Freeport is and how much they will share the investment."

Early in 2014, export restrictions were put in place by the country in order to compel mining firms to develop smelting and processing facilities so that Indonesia will be able to refine all of its raw ores and concentrates.

Following an export tax dispute that lasted for nine months, Newmont signed a deal with the Indonesian government late 2014 that allowed for the resumption of copper concentrate exports.

According to Sukhyar's forecast in February, Newmont is expected to produce 500,000t of copper and gold concentrate in 2015, which is expected to be a rise from 400,000t last year.

Last month, Indonesia's Government has lifted its previously announced demand that Freeport-McMoran, the US-based natural resource company needs to construct a copper smelter in Papua province.