Monday, February 13, 2017

1) Freeport says it hasn’t agreed on new contract scheme

2) Freeport Yet to Agree on Switch Over from Contract of Work
3) Jonan Leaves Freeport’s Policy to Sri Mulyani  
4) Sriwijaya Air to open direct flights between Surabaya-Jayapura

1) Freeport says it hasn’t agreed on new contract scheme
Jakarta | Mon, February 13, 2017 | 11:20 am

PT Freeport Indonesia spokesperson Riza Patrama has said that the company has not agreed on the conversion of its contracts of work (CoW) to special mining licenses (IUPK) with the Indonesian government.
“We have not agreed because we have not seen the guarantee for investment certainty,” Riza said, as reported by on Monday.
Previously, the Indonesian government had announced that it had approved contract conversions for gold and copper miner PT Freeport Indonesia and copper producer PT Amman Mineral Nusa Tenggara, allowing them to continue exports of their partially processed minerals.
The Energy and Mineral Resources Ministry had announced that after the issuance of the IUPK, Freeport could apply for an export permit from Indonesia after exports had been prohibited pending smelter construction. 
As required by a revised government regulation that has partially lifted the ban on exports of raw and partially processed minerals, the two companies have reportedly converted their CoWs into IUPKs.
Riza said Freeport would sign the IUPK issued by the government if the agreement included investment stability with legal and fiscal certainty, as the CoW had.
He said such certainty was important for Freeport's long-term investments in Indonesia.  (bbn)

MONDAY, 13 FEBRUARY, 2017 | 08:02 WIB
2) Freeport Yet to Agree on Switch Over from Contract of Work

TEMPO.COJakarta - Riza Pratama, spokesman of PT Freeport Indonesia, a local unit of U.S. based mining company Freeport-McMoRan Inc., said that the company has not agreed to switch over from its contract of work (CoW) to temporary special mining permit (IUPK) issued by the government. “We have yet to agree because there is no assurance of a safe investing environment,” Riza told Tempo yesterday.
Freeport has halted its mineral exports due to the lack of agreement on the switchover. Freeport-McMoRan Inc. spokesman Eric Kinneberg told Reuters last weekend that the company has halted concentrate exports since January 12. The mining company said it will continue to negotiate with the Indonesian government, noting that new mining permit provisions should be equal to that of its current CoW.
Kinneberg said the agreement was critical for Freeport Indonesia’s long-term investment. He said that new mining permit requires Freeport to pay taxes and royalty. The company is also required to dispose of its 51 percent stake to the Indonesian government, an increase from the previous requirement of 30 percent. Freeport has only divested its 9.36 percent stake so far.
Freeport made the statement shortly after the Energy and Mineral Resources Ministry announced that it has issued temporary IUPK to Freeport, which would allow the mining company to obtain a mineral concentrate export permit. The government has banned Freeport from exporting concentrate before it built a smelting plant.
Freeport said the halt in concentrate exports would reduce the output Grasberg mine in Papua by around 70 million pounds of copper per month. The company had planned to lay off 30,000 workers in mid-February if denied export permit.
Earlier on Friday, director general for mineral and coal, the Energy and Mineral Resources Ministry, Bambang Gatot Ariyono said the ministry had approved requests of Freeport Indonesia and PT Amman Mineral Nusa Tenggara (AMNT) to switch over from CoW to special mining permit for mineral concentrate production.


MONDAY, 13 FEBRUARY, 2017 | 22:26 WIB
3) Jonan Leaves Freeport’s Policy to Sri Mulyani  

TEMPO.COJakarta - The government is yet to clarify the fiscal policy that will be made for PT Freeport Indonesia, which is currently holding a special mining license. Energy and Mineral Resources Minister Ignasius Jonan said that he would leave the matter in Finance Minister Sri Mulyani Indrawati's hands.
"It's Finance Ministry's domain. Finance Minister Sri Mulyani will decide which policy to be implemented," Jonan said at the Presidential Palace in Jakarta on Monday, February 13, 2017.
On February 10, 2017, Freeport has officially changed its status from a contract work holder to a special mining license holder, following the issuance of Energy Minister's Regulation No. 6/2016 that derives from Government Regulation No. 1/2017. The new bill principally allows contract of work holders to export mineral concentrates provided that they acquire a special mining license.
Before agreeing to change its status as a special mining license holder, Freeport sent a letter to the Energy and Mineral Resources Ministry asking for “incentives” and guarantees that include legal certainty and fiscal policy.
Energy and Mineral Resources Deputy Minister Arcandra Tahar earlier said that there would be no room to negotiate for Freeport. In other words, the request for incentives would not be granted, since Freeport must comply with the prevailing fiscal regulations.
Jonan said that he would discuss the issue with Sri Mulyani to decide which fiscal policies that will apply for Freeport.


4) Sriwijaya Air to open direct flights between Surabaya-Jayapura
Jakarta | Mon, February 13, 2017 | 04:37 pm

Private carrier Sriwijaya Air plans to open direct flights from Surabaya to Jayapura in Papua, starting from Feb. 24.
Previously, passengers with the airline on flights to and from Papua had to pass through cities like Ujung Pandang in South Sulawesi.
"There is rising mobility through this route. With this flight, passengers can fly back and forth between Surabaya and Jayapura in a matter of a few hours," Sriwijaya Air senior manager for corporate communications Agus Soedjono said in an official statement.
The flights will be available four times a week, on Monday, Wednesday, Friday and Sunday.
The airline will deploy Boeing 737 800 NG with a capacity of 189 passengers for the flight.
Sriwijaya Air currently operates 54 domestic and regional routes. (bbn)

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