Minister of Energy and Mineral Resources, Bahlil Lahadalia, says the decision on PT Freeport Indonesia’s (PTFI) copper concentrate export permit extension will be discussed in a meeting with Coordinating Ministry for the Economy, Ministry of Finance and Ministry of Industry along with President Prabowo Subianto by mid of this year.
“We will have a meeting with the President. So, maybe it will be discussed from now until June what kind of treatment for PTFI will be,” Bahlil told a press conference on Monday, January 6, 2025.
He cited that until now there has been no official government decision regarding the granting of export relaxation for PTFI. Meanwhile, the operation of PTFI’s copper smelter in the Java Integrated Industrial and Port Estate (JIIPE), Gresik, East Java, is being accelerated, with the target ramp-up advancing from August to May or June 2025.
This copper smelter functions to process copper concentrate mined by PTFI in Papua. As long as the smelter is not fully operational, PTFI relies on exporting copper concentrate abroad to maintain the sustainability of its operations.
The decision regarding the relaxation of concentrate exports will take into account national strategic interests, including optimizing the added value of Indonesia’s mineral resources. The government is trying to ensure that the policies taken not only support the sustainability of PTFI’s operations, but also support the domestic economy and the development of downstream industries.
“The government will continue to coordinate to determine the best measures, including accelerating PTFI’s smelter operations so that it can immediately provide optimal contributions to the national economy,” Bahlil said.
On the other hand, PT Freeport Indonesia (PTFI) has submitted a request for copper concentrate export relaxation after the export permit expired on December 31, 2024. This request was submitted following a fire incident at a smelter facility located in the Gresik Special Economic Zone (KEK), East Java, which caused the cessation of copper cathode production operations.
President Director of PTFI, Tony Wenas, revealed that all smelter operations were still stopped for the repair process. “It’s still fully stopped. If it’s being repaired, it’s impossible to produce,” Tony said at the Coordinating Ministry for Economic Affairs Office on Friday, January 3, 2025.
Meanwhile, a senior official at the Coordinating Ministry for the Economy, Elen Setiadi, said that based on PTFI’s report, the smelter could only gradually return to production in July 2025.
“Ramp-up is targeted to start in July, but its capacity is only 40 percent of total production,” he said.
Tony Wenas ensured that PTFI had conducted a thorough investigation to determine the cause of the fire and identify the damage. The incident occurred at the gas cleaning plant facility, which functions to clean CO2 gas from the concentrate combustion process.
“We ensure that all employees are safe and no one was injured. There is no negative impact on public health or the surrounding environment,” Tony said.
The gas cleaning plant facility that caught fire plays an important role in converting CO2 gas into sulfuric acid, which is used for the fertilizer industry, nickel HPAL factories, and various other needs.
Impact of fire incident
The temporary closure of the smelter caused PTFI to be unable to meet its production and export targets. This prompted the company to apply for export relaxation in order to maintain operations and meet production obligations while waiting for the smelter ramp-up.
PTFI is committed to completing smelter repairs in a timely manner and anticipating that similar incidents do not recur. The government is still evaluating the export relaxation application and will consider its economic impact, especially on PTFI’s contribution to state revenue.
