Industry Minister: Renegotiation with Freeport is Over

TEMPO.CO, Jakarta - The government claimed that the renegotiation with PT Freeport Indonesia is over.  The United States’ mining company agreed to the government’s term on the mandatory smelter development in processing raw minerals.

As proof of seriousness in the smelter development, said Minister of Industry M.S. Hidayat, Freeport gave assurance money to the state worth US$105 million through one of the State-Owned Enterprises’ bank account.  Freeport is targeted to soon develope smelters that will operate in three years.

“The government has negotiate with Freeport’s Director Jim Bob Moffett.  With various argumentations, they have agreed to all terms that are based on the Law No.4 Year 2009 concerning Mineral and Coal,” Hidayat said on Tuesday, July 8, 2014.

The successful renegotiation will be conveyed by the Minister of Economic Coordination, Chairul Tanjung, to President Susilo Bambang Yudhoyono (SBY) through a cabinet meeting.  The cabinet meeting is targeted to be held this week.

For Newmont, said Hidayat, the government will recall the company to discuss negotiation progress with Freeport.  “I dont’ know whether they will follow the early scheme which follows the negotiation with Freeport or continue it to an arbritration,” he said.

In the early negotiation with the government, Newmont stated that they will participate in the negotiation process with Freeport.  But it turned out that Newmont had submit the problem to the international arbitration.

“If they change their mind, the Indonesian government is prepare to deal with Newmont.  We will use fine lawyers.  We will fight because we know their weaknesses,” Hidayat told reporters.

AMIR TEJO