Indonesia is preparing to allow mining companies to renew their contracts earlier than two years before the expiry date.
According to the country's mines minister, the decision is expected to favour US-based Freeport-McMoran and its expansion plans at the Grasberg copper mine.
At present, the government is negotiating the plans of the mining companies developing domestic smelting and processing facilities, Reuters reported.
Earlier this week, Indonesia stated its intention to ban exports of copper and other mineral concentrates in 2017.
Freeport plans to expand its sole copper smelter at Gresik, Indonesia, and gave its support of a government-backed industrial zone in Papua, prompting the government's willingness to be flexible.
Indonesia Energy and Mineral Resources Minister Sudirman told reporters: "The government regulation for extension proposals that regulates a minimum of two years before a contract expires will be revised."
Many mining companies operating in the country are eligible to apply for a contract extension two years before a concession agreement is due to end, according to the existing rules.
The minister said that new regulations on contract extensions would be linked to mining company's smelter plans.
Freeport has been seeking contract certainty prior to investing more than $15bn in converting its Indonesian asset into a larger underground mine after 2016.
Image: Astronaut photo of the Grasberg Mine in Indonesia. Photo: courtesy of ISS Crew Earth Observations experiment and the Image Science and Analysis Group, Johnson Space Center.