Government Should Ask Freeport To Build Smelter In Papua : KADIN

JAKARTA, Sept 4 (Antara) - Deputy chairman of the influential Chamber of Commerce and Industry (Kadin) for Eastern Indonesia Andi Rukman Karumpa said the government should ask Freeport to build its smelter in Papua. The U.S. mining giant Freeport McMoRan Inc. has large copper and gold mine in Grassberg, Papua, operated by its subsidiary PT Freeport Indonesia. The U.S. company has agreed to build a smelter to process its copper concentrate in five years and to divest 51 percent of its stake in Grassberg to Indonesia ending dispute over its contract. In return the government agreed to extent its contract 2x10 years after the expiration of its present contract in 2021, and allow it to resume exports of concentrate until the smelter is in operation. "The government position is strong. The smelter should be built in Papua," Andi said in a statement received here on Sunday. He said the Law on Minerals and Coal No. 4 of 2009, which requires mining companies to process their mineral ores in the country before being exported, did not specify the smelter they want to build should be around in the mining area. "But building the smelter in Papua would help create equitable industrialization and distribution of public welfare," he said. He said by controlling the majority share of Freeport Indonesia, the government could set the strategy and policy including in determining the location of the smelter. Andi said he knew that President Joko Widodo (Jokowi) has shown his great attentions to development of more backward eastern regions of the country notably Papua. Meanwhile, deputy chairman of the Commission VII of the House of Representatives Satya Widya Yudha said the government success in persuading Freeport into agreeing to divest 51 percent stake in PT Freeport Indonesia deserved appreciation. "We appreciate the policy of President Jokowi over the planned takeover of 51 percent of Freeport Indonesia," Satya said. The Golkar party politician said Freeport also is set to invest US$20 billion in Papua including for the smelter. Another leading lawmaker Kurtubi from the Nasdem party expressed appreciation for the agreement of Freeport to change its contract of work with the Special Mining License (IUPK) under which the government is entitled to more gain in revenues. A member of the Regional Representatives Council (DPD) from Papua, Charles Simare Mare, said he thanks the government for the success in persuading Freeport to agree to the terms set by the government.