Freeport to Sell Copper Concentrate to US after Agreeing to Sell 12 Percent of Shares for Cash

JAKARTA - Freeport McMoRan (FCX) has signed a memorandum of understanding or MoU with the Indonesian government regarding the extension of the Special Mining Business Permit (IUPK).

One of the points agreed to in this MoU is related to the potential for expanding the marketing of copper processed products to the United States.

"PTFI will also be positioned to expand the marketing reach of processed copper to the United States (US) with market requirements if the US needs additional copper supplies," said management in a written statement, Thursday, February 19.

However, management ensures that PT Freeport Indonesia (PTFI) will continue to prioritize domestic downstream through the sale of domestic processed copper, precious metals, sulfuric acid and other products.

In terms of operations, PTFI will increase exploration spending and advance studies to identify and expand long-term resources at Grasberg.

Later, FCX will also release 12 percent of its shares for free after 2041. Despite receiving shares for free, management continued, Indonesia is required to proportionally replace the cost of investment based on the book value for investments whose benefits continue after 2041.

"FCX will maintain its current ownership in PTFI at 48.76 percent until 2041 and hold around 37 percent starting in 2042," continued management.

With this extension of the IUPK, PTFI will increase its support for the people of Papua, including financial support for the construction of a hospital and two medical education facilities.