* Freeport will minimise operational costs with layoffs -
* Freeport seeking clarification on new export rules from
* Antam under review for possible downgrade by Moody's and
By Michael Taylor and Yayat Supriatna
JAKARTA, Jan 14 U.S. miner Freeport-McMoRan
Copper & Gold will be forced to lay off workers from the
world's fifth-biggest copper mine in Indonesia to offset an
unexpected increase in export taxes, a union official said on
President Susilo Bambang Yudhoyono rushed through a
last-minute regulation on Saturday giving copper miners Freeport
and Newmont Mining Corp a reprieve from a controversial
mineral export ban, but imposed an escalating tax to limit the
amount of mineral concentrate exports over the next few years.
Freeport has halted copper concentrate exports from its port
in Papua and is seeking more clarity on the new policy. It also
needs a new export permit to resume shipments.
Under the regulation, the tax for copper concentrate exports
has been raised to 25 percent from 20 percent, and will
gradually go up to a maximum 60 percent by the end of 2016.
"With the export tax at 25 percent, layoffs are inevitable,"
Papua-based Freeport union official Virgo Solossa told Reuters
on Tuesday. "Freeport Indonesia will certainly minimise
operation costs with lay offs. We still don't know how many
workers will be laid off by Freeport."
When asked to confirm the possible layoffs, Freeport
Indonesia CEO Rozik Soetjipto told Reuters that "so far we have
no such plan". The company employs about 24,000 workers,
including contractors and staff, in Indonesia.
The country's second-largest copper producer, Newmont, was
continuing to run mining operations at its Batu Hijau mine as
usual, while the firm waited for official notification from the
government, a spokesman said on Sunday. Newmont did not comment
on its copper exports.
Indonesia introduced the controversial ban on Sunday on a
range of raw mineral ores in order to force companies to build
processing plants on its soil.
The higher export taxes diminished the president's
last-minute relief to the major miners.
Although the government has yet to publish all the
regulations clarifying the export rule changes, mining and
finance ministry officials said concentrate with a minimum of 15
percent copper content will be allowed to be exported despite
the ban. The Freeport website says that concentrates produced in
Indonesia "generally contain 27-30 percent copper".
Rating agencies Moody's and S&P said state-controlled nickel
miner PT Aneka Tambang (Antam) was under review for a
possible downgrade due to the ban. The export halt is expected
to cost Antam an estimated $300 million in revenue this year, as
unprocessed nickel ore shipments represent around 30 percent of