Gresik Smelter Officially Operates, Bahlil Signals IUPK Extension To Freeport

JAKARTA - Investment Minister/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia gave a signal to extend the Special Mining Business License (IUPK) to PT Freeport Indonesia. This is in line with the completion of the construction of its copper smelter in Gresik, East Java.

Bahlil said the smelter project in Gresik had disbursed an investment of IDR 58 trillion. In fact, it contributes to absorbing 40,000 workers during construction.

"On this basis, the Coordinating Minister for the Economy (Airlangga Hartarto) yesterday happened to be one of the teams that negotiated the extension of Freeport with the Minister of Energy and Mineral Resources. It feels a little less fair if we don't give an additional extension because we have built a smelter in Gresik and we will get an additional 10 percent stake," he said at the inauguration of the Gresik Smelter operation, quoted from YouTube Freeport Indonesia, Thursday, June 27.

Moreover, continued Bahlil, PT Freeport Indonesia has also agreed to build a new copper smelter in Papua. He said this is a requirement that must be met for the requirements for giving IUPK.

"God willing, Mr. Tony, we will do it within a short period of time, depending on if PT Freeport has completed the requirements, we will accelerate so that this extension can be carried out," he explained.

Previously, it was reported that the Minister of Investment/Head of the Investment Coordinating Board (BKPM) Bahlil Lahadalia revealed that the negotiation process for the extension of PT Freeport Indonesia's special mining business license (PTFI) had reached 98 percent.

For your information, PT Freeport Indonesia will get an IUPK for 20 years, namely until 2061 after the end of the contract in 2041.

Furthermore, Bahlil also revealed points that had been agreed upon as a requirement for the extension of the IUPK. One of them is PTFI's share divestment of 10 percent.

As for the addition of 10 percent shares, the government through the holding company of mining SOEs, PT Mineral Industri Indonesia (MIND ID) will control 61 percent of PTFI's shares.

In addition to the addition of shares, Bahlil also said that both parties had approved the construction of a new smelter in Papua. But unfortunately, Bahlil did not explain where the area was intended.

"I have negotiated with Freeport. And almost 98 percent, the points have been agreed. One of them is the additional 10 percent stake, then building a smelter in Papua," he said at the BKPM office, Jakarta, Friday, June 7.