Friday, October 9, 2015

1) Indonesia Plans New Mining Contract Renewal Rules by Year-End


2) Indonesia promises Freeport to extend Grasberg contract 
3) Indonesia, PT Freeport Indonesia agree on developing world’s largest underground mining site
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http://jakartaglobe.beritasatu.com/business/indonesia-plans-new-mining-contract-renewal-rules-year-end/
1) Indonesia Plans New Mining Contract Renewal Rules by Year-End
By : Wilda Asmarini | on 2:36 PM October 09, 2015

Indonesia is set to revise its regulations on mining contracts at the end of the year. (Antara Photo/Muhammad Adimaja)
Jakarta. Indonesia plans to amend its rules on mining contracts by the end of the year, a government official said, allowing US miner Freeport-McMoRan to apply for an extension of its contract at the Grasberg copper and gold mine.
Freeport has for years been seeking contract certainty from the Indonesian government. Its existing mining contract ends in 2021, but present rules only allows talks on an extension to start two years before a contract is due to end.
"A revision to the government regulation on the time of a contract extension proposal, is now being processed in the economics ministry," Bambang Gatot, director general of coal and mineral at the mines ministry told reporters on Friday.
"We expect it can be released soon, this year," he said.
The new rules may allow companies to propose an extension 10 years before their contracts expire.
Freeport said on Thursday it had been assured by the government of Indonesia that the contract for its Grasberg mine in the eastern province of Papua would be extended beyond 2021.
The government has been rolling out new measures to re-energise Southeast Asia's largest economy after growth cooled in the second quarter to 4.67 percent, the slowest pace in six years.
President Joko Widodo has shown signs that the government is trying to mend fences with wary investors following a series of nationalistic policies by the previous administration.
Freeport plans to invest $18 billion to transition the Grasberg complex from an open pit to underground mining in late 2017. The company currently produces about 220,000 tons of copper ore per day, which is then converted to copper concentrate.
The move on a contract extension comes after the US miner previously reached agreements on higher royalties, an export tax and domestic processing and divestment.
Reuters
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http://www.mining.com/indonesia-promises-freeport-to-extend-grasberg-contract/
2) Indonesia promises Freeport to extend Grasberg contract 
Cecilia Jamasmie | October 8, 2015
Copper and gold giant Freeport-McMoRan (NYSE:FCX) was trading higher Thursday afternoon after the company announced that Indonesia has promised the company to extent the mining contract for its giant Grasberg mine beyond 2021.
The approval will include “the same rights and the same level of legal and fiscal certainty provided under its contract of work,” the Phoenix-based company said in the statement.
Shares were up 2.61% to $13.35, after climbing more than 10% on Wednesday, when miner said two appointees by billionaire activist investor Carl Icahn were added to the board of directors.
Freeport, the largest listed copper producer, added that the Indonesian government is working on economic stimulus measures, including revisions to mining regulations.
The company, which is under pressure from Icahn and weak commodity prices, said in January it planned to invest $17 billion to build a smelter and for long-term development of its underground gold and copper deposits in Papua province. But in today’s release Freeport didn’t mention any proposal for making companies build a copper smelter in Indonesia or the prospect of Freeport’s local unit selling shares.

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http://www.rappler.com/world/regions/asia-pacific/indonesia/bahasa/englishedition/108649-mining-freeport-investment
3) 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
Rappler.com Published 11:46 AM, October 09, 2015 Updated 11:46 AM, October 09, 2015

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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