Jayapura, Jubi/Antara – Energy and Mineral Resources (ESDM) Minister Sudirman Said has stated that he and Public Works Minister Basuki Hadimoeljono will soon visit Timika to observe the readiness of the region to develop smelters.
The minister made the remarks in a meeting with Papua Governor Lukas Enembe. During the meeting which was also attended by Minister Basuki Hadimoeljono, Minister Sudirman Said remarked that he would directly observe the readiness of the region to build smelters.
According to the chairman of the Papua Regional Legislative Assembly (DPRD) Yunus Wonda, if the smelters are built they should have other supporting facilities.
“Electricity must have been ready and other factories should have already been there such as cement and fertilizer factories,” he said adding that the factories could use the wastes of smelters.
He said that if smelters are built in Papua, there will also be cement and fertilizer factories so that in the future the cement price in the region could be reduced from the current expensive level of Rp1.5 million per sack.
Now is the time for Papua to have smelters because copper which is processed in Gresik, East Java, came from Papua, said Wonda adding that the results of the two ministers’ working visit will be discussed later to know whether Papua is already ready to have smelters.
In the meantime, the plan to build a copper concentrate smelter in Papua will need US$1.5 billion, the provincial mining and energy office said. The cost will include land clearing, head of the regional mining and energy office Bangun Manurung said.
At a meeting on Dec 23, 2014, the government asked PT.Freeport Indonesia, the copper mining company in Papua, to build the smelter in Timika, Papua.
“PT Freeport has been ordered to build the smelter in Papua,” Bangun said, adding, the smelter is expected to be operational in 2020.
The fact that supporting facilities like fertilizer and cement factories are not available in Papua is no reason for not building the smelter “as facilities would also be built,” he said.
He said Papua Governor Lukas Enembe is set to make Timika an industrial district that fertilizer and cement factories would be built there.
“There is no reason for PT Freeport not to build the smelter in Timika, to process its own copper,” he added.
The US company has pledged to build the smelter as a condition for to be allowed to export copper concentrate.
The government has issued a law banning exports of mineral ore necessitating construction of smelter to process ores before being exported. In July 2014, the government licensed Freeport to export 756,300 tons of copper concentrate until January this year on condition it is to build a new smelter in Gresik, East Java.
The smelter in Gresik is to be operational in 2017 and is to be followed with one in Papua scheduled for operation in 2020. The license would be cancelled on Jan. 25 if Freeport failed to show that it has taken a concrete steps toward realization of the plan, according to memorandum of understanding signed earlier between the company and the government.
Energy and Mineral Resources Minister Sudirman Said expressed disappointment at Freeport failing to build the copper smelter. The company has not even decided where the smelter is to be built, the minister said.
He said he believed the company, which is the largest copper and gold producer in the country, is financially capable of building the smelter. (*)