- POSTED: 26 Jul 2014 04:46
Indonesia on Friday (25 July) granted a permit to allow the local arm of US mining giant Freeport McMoRan resume exports, six months after the government applied a controversial ban, the company told AFP.
JAKARTA: Indonesia on Friday (25 July) granted a permit to allow the local arm of US mining giant Freeport McMoRan resume exports, six months after the government applied a controversial ban, the company told AFP.
Southeast Asia's top economy introduced a ban on the export of some unprocessed minerals, and higher taxes on others that can still be shipped out of the country, in January. It is one of a raft of economic policies that critics have dubbed "resource nationalism", and which are pushed by politicians who argue that Indonesia is losing out by allowing foreign firms easy access to lucrative industries.
The government agreed to issue a permit for Freeport, excluding the firm from paying the higher tax it had refused to pay, after the firm agreed to provide a US$115 million assurance bond to support its commitment to build a smelter in the country, as well as pay higher royalties.
Copper concentrate, a major export for US giants Newmont and Freeport McMoRan, was exempt from the ban but the companies still faced paying the new, higher taxes on shipments of the product.
"This is a good news, and we hope that our production will return to normal soon," Rozik Soetjipto, head of Freeport Indonesia, told AFP.
The government said the permit will allow Freeport to export more than 750,000 tonnes of concentrate for the next six months, something Freeport said provides a breather after not exporting for the first half of the year, and only supplying about 40 per cent of its total production capacity to a local smelter.
Soetjipto added that the miner which runs Grasberg, one of the biggest mines in the world, could start exporting as early as the first week of August.
Newmont has a different approach and still cannot export. In June it said it had ceased production and declared force majeure as it refused to pay the new, high levy, and filed for international arbitration against Indonesia.