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UPDATE 1-Freeport Indonesia says to resume copper concentrate exports by Wednesday
August 4, 2014 / 5:40 AM / 3 years ago

UPDATE 1-Freeport Indonesia says to resume copper concentrate exports by Wednesday

(Adds additional details)

By Yayat Supriatna

JAKARTA, Aug 4 (Reuters) - Freeport-McMoRan Inc’s Indonesia unit will resume copper concentrate exports by Wednesday, the company’s local CEO said on Monday, after it resolved a six-month old tax dispute with the government.

Freeport, which runs one of the world’s biggest copper mines in Papua, would make an initial shipment of 10,000 tonnes to China, Indonesia CEO Rozik Soetjipto said.

“It will be the first export shipment this year,” Soetjipto told Reuters in a text. “Hopefully all administration matters can be finished according to the schedule.”

Traders said the resumption of concentrate exports has been largely priced in to the market.

Freeport clinched a deal with the Indonesian government late last month to end the dispute over a controversial escalating tax on metal concentrates that climbed to 60 percent by 2017.

The export tax was part of moves to force miners to develop local mineral processing facilities, which would bring bigger returns for the government from Indonesia’s mineral resources.

However Freeport and Newmont Mining Corp, which account for nearly all of Indonesia’s copper exports, instead halted exports from Indonesia, resulting in $1.3 billion in lost copper concentrate shipments.

Indonesia’s total mineral exports fell 27 percent in the first half of 2014 on a year earlier due to the ban on mineral ore shipments, the country’s statistics bureau said on Monday.

Under a revised deal Freeport, which is expected to export 756,000 tonnes of copper concentrate in the second half of this year, will pay a 7.5 percent duty on its copper concentrate exports, which will decline as its spends to build a smelter.

The Freeport concentrate exports would be the first since the new government rules on exports, but Newmont’s attempts to resolve the impasse over its copper exports remain in limbo.

The Denver, Colorado-based miner last month filed for international arbitration over the new export rules that it said were in breach of its contract, drawing a rebuke from the government. (Reporting by Yayat Supriatna; Writing by Michael Taylor; Editing by Randy Fabi and Richard Pullin)

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