Freeport Might Spend $2 Billion for Smelter

JAKARTA (Yosefardi) – Freeport-McMoRan Copper & Gold Inc. (FCX) might spend US$2 billion for establishing smelter in Indonesia with the capacity equal to PT Smelting, Bisnis Indonesia reported this morning. Richard C Adikerson had met minister of industry, MS Hidayat, on Wednesday (Jan 29) to discuss about downstream business in Indonesia. Richard proposed the government of Indonesia to review or make such a relaxation on new progressive export duty on copper concentrates ruled by the government. MS Hidayat said his ministry only concerns on the smelter issue required to be established within next three years, until 2017. He said the export duty is on the hand of finance ministry. Freeport-McMoRan Copper & Gold Inc. (FCX) and Freeport Indonesia are now seeking to obtain the administrative permits for 2014 exports, which are currently pending and have been delayed as a result of the new regulations. In January 2014, the Indonesian government published regulations regarding exports of minerals, including copper concentrates. The regulations provide that holders of contracts of work with existing processing facilities in Indonesia may continue to export product through January 12, 2017, but establish new requirements for the continued export of copper concentrates, including the imposition of a new progressive export duty on copper concentrates in the amount of 25 percent in 2014, rising to 60 percent by mid-2016.