(Adds detail on Indonesia export tax, detail on Indonesia
production, analyst expectations.)
April 24 Freeport McMoRan Copper & Gold Inc
reported a decline in first quarter profit on Thursday,
hurt by lower copper prices and a conflict with the government
of Indonesia that has halted its copper concentrate exports from
But earnings came in ahead of analyst expectations and
shares rose 2.2 percent to $34.25 in pre-market trading.
The company said it is working to resolve the dispute in
Indonesia over a new export tax announced in January. Its huge
Grasberg gold and copper complex is located in Papua province.
In the first quarter, Freeport's Indonesian subsidiary
produced 140 million pounds of copper, down from 219 million
pounds a year earlier. It milled ore at about half its normal
rate in the first quarter, roughly 118,000 tonnes of ore per
Freeport and Newmont Mining Corp, another U.S.
company working in Indonesia, halted concentrate exports in
January after the government announced the tax.
They have argued that the tax violates their contracts with
the government, which exempt them from new taxes, duties or
fees. The two miners pay a 35 percent corporate income tax plus
royalties and other fees, but no export taxes.
Under a joint venture agreement, Rio Tinto
gets a 40 percent share of the output from Grasberg above
certain levels until 2021, and 40 percent of all production
Freeport's net income fell to $510 million, or 49 cents a
share, from $648 million, or 68 cents, a year earlier. Revenue
rose to $4.99 billion from $4.58 billion, boosted by the
company's recent oil and gas acquisitions.
Analysts had been expecting earnings of 43 cents a share,
according to Thomson Reuters I/B/E/S.
(Reporting by Allison Martell in Toronto; Editing by Chizu
Nomiyama and Paul Simao)