Freeport’s Mining Permit Extension Most Certainly After 2041: Minister

Written by on May 25, 2023

TEMPO.CO, JakartaInvestment Minister and Indonesia Investment Coordinating Board (BKPM) Head Bahlil Lahadalia revealed that the government will almost certainly extend PT Freeport Indonesia’s special mining business permit contract due to expire in 2041.

“We will decide on Freeport in the near future. Closer, but almost certain,” Minister Lahadalia remarked after attending the Indonesia-China Smart City Technology and Investment EXPO 2023 event in Jakarta, Wednesday.

Freeport has applied for a license extension to operate after 2041. However, the government, through the Ministry of Energy and Mineral Resources (ESDM), is still discussing details regarding the license extension, especially taking into account additional revenue and benefits for the state.

One of the conditions put forth by the government was for Freeport to increase the government’s shareholding in the mining company by 10 percent, which turns out to 61 percent.

Lahadalia called for an increase in the number of shares on account of Freeport’s rising revenue. In 2022, state revenue from Freeport, comprising taxes, dividends, and non-tax state revenues, had reached US$3.32 billion. Meanwhile, it is estimated to reach US$3.76 billion in 2023.

“Freeport must be willing, must be willing, how it must be willing. If Freeport does not want to add, I am ready to be evaluated by the minister. The 10 percent must be cheap. I do not want to ask for the current valuation,” Lahadalia stated during a press conference at his office, Friday (April 28).

Speaking on similar lines, Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif stated that extension of the Freeport license must provide additional revenue for the government. Moreover, even if the smelter is integrated and there are still reserves, then the permit for the extension of operations can be done more quickly. In fact, the extension is required for five years before it expires.

“In principle, it should be able to provide additional income and benefits for the government,” Minister Tasrif stated in Jakarta on April 28.


Editor’s Choice: Govt to Add 10% More Shares in Freeport, Says Investment Minister

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