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Monday, 2 February 2015 - 15:22 WIB

Government Should be Firm on PT.Freeport

PT Smelting (PTS)'s Gresik Copper Smelter and Refinery at Gresik, East Java - mmc.co.jp

PT Smelting (PTS)'s Gresik Copper Smelter and Refinery at Gresik, East Java - mmc.co.jp

PT Smelting (PTS)'s Gresik Copper Smelter and Refinery at Gresik, East Java - mmc.co.jp

PT Smelting (PTS)’s Gresik Copper Smelter and Refinery at Gresik, East Java – mmc.co.jp

Jakarta, Jubi / Antara – An economist at  University of Sam Ratulangi, Agus Tony Poputra, urged the government to be firm in dealing with PT Freeport.

“The extension of the MoU between the government and Freeport showed that the government has been captive to the interests of PT Freeport Indonesia,” Agus Tony Poputra said in a written statement received in Jakarta on Friday (30/1).

He said Law No. 4 of 2009 on Mineral and Coal Mining clearly bans the exports of raw minerals, as does Minister of Energy and Mineral Resources Regulation No. 20 of 2013, which was issued  in 2014.  As a result, he said, many mining companies stopped their activities are are required to build “smelters” in order to export processed products.

He asserted that the real export of raw materials is very detrimental to Indonesia including loss of additional employment opportunities and other economic losses.

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He added, the value of a byproduct of continued process of mining has high values, but on the other hand the value of exports of raw materials is generally low.
“Therefore, revenues through taxes and royalties are relatively low and other countries enjoy the added value of advanced processes and products,” Poputra said.

Unfortunately Freeport actually delayed the construction of smelters and used its privilege by asking to export in the form of a concentrate.

Separately, professor of economics, University of Brawijaya, Prof. Dr. Ahmad Erani Yustika said, the government has no firmness in the face of Freeport. It can be seen by the extension of cooperation with the company.
“The extension of the MoU between the Ministry of Energy and Mineral Resources (MEMR) and PT Freeport for the duration of the next six months should not be necessary because there are a lot of things have been denied by this giant company,” he said in Malang on Tuesday (27/1).

He further said today Freeport has not yet built a smelter in Papua, whereas the obligation should have been realized since five years ago. In fact, the royalty payment was also not met and often delayed.

As reported previously, the government understood the demand of PT Freeport Indonesia on contract extension in the Grasberg mine in Papua that will be ended in 2021. Minister of Energy and Mineral Resources Sudirman Said during a working meeting with the House of Representatives Commission VII in Jakarta on Monday (26/1), said that the company needs a certainty on contract extension of spending plans investments worth 17.3 billion dollars.

Meanwhile, PT Freeport Indonesia (PTFI) appreciates the government’s decision to extend the Memorandum of Understanding (MoU) the amendment of the work during the next six months since January 25, 2015.
“PT Freeport Indonesia really appreciate what was decided by the government so that PTFI can still continue its operations,” said President Director of PT Freeport Indonesia Maroef Syamsoeddin in a press conference at the Ministry of Energy and Mineral Resources in Jakarta on Sunday (25/1).

He said that PTFI will continue to strive to continue to provide benefits and value-added continuously to the Indonesian state, and the people of Papua in particular. (*/ Tina)

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