The Relaxation Of Freeport's Proposed Concentrate Exports Is Assessed To Disrupt The Downstreaming Program

Photo: Doc. Freeport Indonesia

JAKARTA - Gadjah Mada University (UGM) energy economics observer Fahmy Radhi is worried that the relaxation of concentrate exports proposed by PT Freeport Indonesia (PTFI) will disrupt the downstream program being promoted by the government.

"If the government fulfills these demands, President Joko Widodo's (Jokowi) flagship downstream program will be in ruins. "In fact, the noble goal of Jokowi's downstream program is to increase added value and develop the industrial ecosystem," he said in a written statement, quoted from Antara, Thursday, October 26.

Fahmy believes that granting relaxation permits for concentrate exports will eliminate the opportunity for Indonesia to increase the added value of downstream products.

The relaxation of concentrate exports will also cause discrimination against nickel and bauxite entrepreneurs who have been required to downstream in domestic smelters, so that they will demand a similar export relaxation.

Therefore, Fahmy asked the government to no longer grant the concentrate export permit proposed by Freeport.

“The Jokowi government should not be afraid of Freeport's bluff. "The government must be consistent with the policy of prohibiting concentrate exports, and remain consistent in carrying out downstream programs to increase added value and build an industrial ecosystem," he said.

It is known that PTFI has again proposed an extension (relaxation) of exports of copper concentrate and anode mud until the Manyar smelter in Gresik, East Java is fully operational by the end of 2024.

Construction of the Manyar smelter is targeted for completion in mid-2024, followed by commissioning of the facility and a production ramp-up schedule until the end of 2024.

In fact, the government had previously granted permission to extend PTFI's concentrate exports, which was supposed to end in June 2023, and was extended until May 2024.

PTPI is asking for permission to relax concentrate exports again because currently the construction progress of PTFI's Manyar copper smelter in Gresik has only reached around 84 percent.

Fahmy noted that since 2014, relaxation permits have been granted to Freeport more than eight times.

"Every time a relaxation permit for concentrate exports is granted, Freeport always breaks its promise to complete the smelter construction within the stipulated time," he said.