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FREEPORT - Minister of Energy and Mineral Resources (ESDM) Ignatius Jonan affirmed that stake divestment is one of the conditions that PT Freeport Indonesia has to meet if it wants to get its contract extended.
"One of the conditions for us to grant contract extension is divestment. If not, we will not grant contract extension permit," Jonan stated at the Presidential Palace in Jakarta on Wednesday.
He revealed that by the end of this month, Freeport and the government would continue talks on the renewal of the contract.
Regarding the rebuttal of Freeport Indonesia, through its spokesman Riza Pratama, that divestment has not been agreed, Jonan revealed that he had directly spoken to Freeport-Mcmoran Inc. CEO Richard Adkerson.
"The one I should meet is Adkerson. I think I do not need to meet those at the junior level," Jonan explained.
Coordinating Minister for the Economy Luhut Pandjaitan added that talks on the 51 percent divestment of Freeport shares are still underway, and divestment is a requirement for contract extension.
"What Mr. Jonan says (is true that) we should accept a 51 percent divestment. We have to 'divest' Freeport, then the smelter must be built, and the taxes will continue. Taxes will go down, and it is still being calculated," Luhut noted at the Presidential Palace.
The Coordinating Minister for Maritime Affairs remarked that Freeport wanted the same tax payments, and the government does not mind the downtrend.
"Basically, we agree because the tax tends to go down. But obligations are still underway on tax obligation to the region," he revealed.
In the meantime, Vice President Jusuf Kalla has said that the government was confident of fruitful negotiation.
The government expressed hope that the negotiation between the Indonesian government and PT Freeport Indonesia would reach a common ground, one of which is the divestment of 51 percent.
Kalla stated that the process of negotiation between the Indonesian government and PT Freeport Indonesia was still ongoing. The government believes that the negotiations will be fruitful in accordance with the specified due time.
"I am sure there will be a conclusion," Kalla noted in Jakarta on Tuesday.
There are four important points in the negotiation process, namely the divestment of 51 percent for the Indonesian government, operational continuity, smelter development, and investment stabilization in the form of fiscal policy.
"The greatest problem is the preparation time of each point," Kalla remarked.
