Freeport, Amman awaiting green light on 2018 Indonesia copper exports

JAKARTA – The Indonesian unit of Freeport-McMoRan and fellow copper miner Amman Mineral Nusa Tenggara (AMNT) are waiting for last-minute mining ministry approvals to their applications to extend copper concentrate exports, company officials said.

Freeport's export permit for Grasberg, the world's second-biggest copper mine, is due to expire on Friday, as is Amman's permit to ship ore concentrate from its Batu Hijau mine on the island of Sumbawa.

Current rules require Freeport and Amman to reapply for export licences every year, and extensions are often granted only once previous permits have expired, creating logistical headaches for the companies.

Indonesia's mining ministry is "still evaluating" the applications and will not issue a recommendation today, said Bambang Gatot, director-general of Coal and Minerals.

Freeport obtained a quota to export 1.1-million tonnes of concentrate in the year ended on February 16. The company has applied for almost the same volume this year, Gatot said.

Once the permit expires, exports will "not stop", he said, noting that shipments don't happen every day.

Mine production doesn't stop, for example, while companies wait for their annual work plans to be approved, Gatot said.

Miners in Indonesia must submit production and development plans every year to be approved by the mining ministry.

Riza Pratama, a spokesman for Freeport Indonesia, said the company's 2018 work plans were approved last week.

"We hope (export renewal is) smooth and there's no delay," Pratama told Reuters.

Under rules issued in 2017, export recommendations are only granted to companies that keep to smelter development timelines.

Freeport's exports were held up by Jakarta for 15 weeks last year, with domestic processing one of the sticking points.

Freeport had completed just over 2% of a long-promised second copper smelter in Indonesia, Bambang Susigit, minerals director at the Mining Ministry said last week.

The government, though, will also consider progress Freeport has made in other areas in evaluating its export application, he said.

Medco Energi Internasional unit Amman sees shipments at 593 806 wet metric tonnes of copper concentrate in the year ended February 16, a company official said.

Amman had a quota to export 675 000 t during the year. It was not clear how much the company has applied for in 2018.

Amman's development of copper processing and refining facilities is "running according to plan", and has been reported to the government, AMNT senior government relations manager Potro Soeprapto told Reuters.