Freeport Hopes to Get Copper Concentrate Export Relaxation Extension Permit

FREEPORT-JAKARTA. PT Freeport Indonesia (PTFI) hopes to obtain an extension for the relaxation permit for copper concentrate exports.

PT Freeport Indonesia's CEO, Tony Wenas, said that PTFI has not yet sent an official letter to the Ministry of Energy and Mineral Resources (ESDM) to submit a request for the extension of the relaxation permit for copper concentrate exports.

However, Tony said, discussions about this with the government have already begun. "So indeed, it has been discussed with the government before, the hope is to continue to export a portion of it until the end of 2024, until December," said Tony when met by reporters after attending the 14th Kompas100 CEO Forum, on Monday (23/10).

As known, PTFI previously obtained a copper concentrate export permit on July 24, 2023. With this permit, PTFI received approval from the Indonesian government to export as much as 1.7 million tons of copper concentrate until May 2024. While still completing the ongoing PTFI copper concentrate purification facility project, namely the Manyar smelter, of course.

This relaxation policy is stipulated in the Minister of Energy and Mineral Resources (ESDM) Regulation Number 7 of 2023 concerning the Continuation of the Development of Metal Mineral Purification Facilities in the Country, enacted on June 9, 2023.

Article 3 of the regulation states, that the holder of the IUP stage of metal mineral production operations or the holder of the IUPK stage of metal mineral production operations for copper, iron, lead, or zinc commodities that are building and committed to completing the construction of their own purification facilities or cooperating to build purification facilities, can sell processed products (concentrates) abroad in certain amounts until May 31, 2024.

However, according to Freeport-McMoRan's quarterly report for the first 9 months of 2023, which was published recently, the construction of the Manyar PTFI smelter is projected to be completed in mid-2024. Followed by the commissioning stage and then production with a gradually increased capacity level until the end of 2024. Until the quarterly report was published, the smelter construction, which has a total project value of US$ 3 billion, was only 'completed' 84%.

That's why, PTFI then hopes to still be allowed to export a portion of copper concentrate production that cannot yet be accommodated by the smelter.

"Our smelter will start operating in May (2024). But it takes time to reach 100% production. Well, it only reaches 100% production in December 2024, gradually," explained Tony.

It is not yet clear how the Ministry of ESDM views this aspiration for extension. The Secretary General of the Ministry of ESDM, Dadan Kusdiana, said the matter still needs to be discussed with the Ministry of Finance (Kemenkeu) and other stakeholders.

"Let's just see, there will be a discussion of studies, communication with the Ministry of Finance and others, this is a process," said Dadan when met by reporters at the Ministry of ESDM Building, on Monday (23/10).

However, Dadan also hinted that the Ministry of ESDM pays attention to the importance of investment.

"We just follow the existing regulations, but we are also concerned about investment," he said.