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Freeport Indonesia has initial approval to resume copper exports
An aerial view of a giant mine run by U.S. firm Freeport-McMoran Cooper & Gold Inc., at the Grassberg mining operation, in Indonesia's Papua province in this July 2005 file photo. REUTERS/Stringer/Files

Freeport Indonesia has initial approval to resume copper exports

JAKARTA: Freeport McMoRan Inc has received preliminary approval to resume copper concentrate exports from its Indonesian operation and hopes to lodge an application for an export permit this week, a company spokesman said.

Indonesia halted Freeport’s copper concentrate exports in January under new rules requiring the Arizona-based company to adopt a special licence, pay new taxes and royalties, divest a 51 percent stake in its operations and relinquish arbitration rights.

However, hopes of a resumption of exports from Freeport’s Grasberg mine have improved since the end of March, when the mining minister said a temporary licence would be granted while discussions on longer-term issues continued.

“We have approval for exports and are working on finalising an export permit,” Freeport Indonesia spokesman Riza Pratama told Reuters on Tuesday.

Mining ministry officials could not be reached for comment on the matter.

An earlier recommendation for Freeport to export up to 1.1 million tonnes of concentrate would still apply, but the company still needs an export permit from the Trade Ministry, Director General of Coal and Minerals Bambang Gatot said at that time.

The latest deal is expected to allow Freeport to export copper concentrate for six months, while working to reach agreement with the government on the other disputed issues.

The stoppage has resulted in thousands of layoffs and cost both sides hundreds of millions of dollars. In February Freeport served notice, saying it has the right to commence arbitration in 120 days if no agreement is reached.

Freeport’s joint venture partner at Grasberg, Rio Tinto , has also warned several times it is considering whether to continue the partnership at the world’s second-largest copper mine, given the uncertainties surrounding Freeport’s negotiations over long-term mining rights in Indonesia.