Grasberg

Indonesia’s Energy and Mineral Resources Ministry has issued a copper export permit to Freeport-McMoRan, allowing the company to restart shipments from its Grasberg mine in Papua again.

The latest permit issued for a period of six months will put an end to a two-week stoppage of export following expiry of the previous one on 28 January 2016.

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Freeport-McMoRan was forced to stop overseas shipments from the Grasberg mine after the Indonesian Government demanded it pay a $530m deposit initially for a new smelter before approving a new export permit.

In 2015, Freeport is believed to have extracted $1.7bn of copper and $1.4bn of gold from the Grasberg mine.

Furthermore, the company aims to extend its contract until 2021 to operate in Indonesia.

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"In 2015, Freeport is believed to have extracted $1.7bn of copper and $1.4bn of gold from the Grasberg mine."

In October 2015, PT Freeport Indonesia and the Government of Indonesia agreed on continuing operations of the Grasberg mining complex beyond 2021.

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Freeport has plans to make $18bn investment to expand its operations at the mine, and is seeking assurances from the government that it will get a contract extension.

Majority of the Grasberg mine is owned by Freeport-McMoRan, which owns 90.64% of PT Freeport Indonesia, the company’s principal operating subsidiary in Indonesia, including 9.36% owned through its wholly-owned subsidiary, PT Indocopper Investama.

The Government of Indonesia owns the remaining 9.36% of PT Freeport Indonesia.

In 2014, exports from Grasberg were interrupted following a dispute with the Indonesian government over export duties.

Image: Grasberg mine open pit. Photo: courtesy of Alfindra Primaldhi.