Ministry of Energy and Mineral Resources of the Republic of Indonesia

10/14/2021 | Press release | Distributed by Public on 10/13/2021 19:17

President Joko Widodo Leads Smelter Groundbreaking of Freeport Indonesia

President Joko Widodo Leads Smelter Groundbreaking of Freeport Indonesia

Tuesday, 12 October 2021 - Dibaca 292 kali




NUMBER: 361.Pers/04/SJI/2021

Date: 12 October 2021

President Joko Widodo Leads Smelter Groundbreaking of Freeport Indonesia

President Joko "Jokowi" Widodo on Tuesday (12/10) led the groundbreaking ceremony of the refining and processing plant (smelter) of PT Freeport Indonesia (PTFI) in Gresik Special Economic Zone (KEK) in East Java Province. The plant is expected to create added value to domestic mining products.

"This is why PT Freeport's smelter is constructed in the country, namely in Gresik, East Java Province. This is a strategic strategy for copper mining industry after we gained control of 51 percent of Freeport's shares; at the time, we encouraged Freeport to construct a smelter in the country. Because once again, we want to have the added value here," said the President at the groundbreaking site.

Besides increasing mineral added value, the construction of smelter in the country is believed to strengthen downstream industries. The President said he would instruct miners, both private and state-owned, to carry out downstream activities so that mining commodities would deliver higher value.

Downstream activities will also impact on job creation and increase of state revenue. "During the construction period alone, as many as 40,000 workers will be needed, which means there will be many job opportunities in Gresik Regency and East Java Province, not to mention when the smelter is fully operational," the President continued.

Built on 100 hectares of land, the smelter will become the largest single-line smelter in the world with a processing capacity of up to 1.7 million tonnes of copper concentrate per year or 480,000 tonnes of copper metal.

"I hope the presence of PTFI in the Gresik KEK will attract other industries, especially copper derivative industries, to come to the KEK to invest here," the President explained.

President Jokowi went on to affirm the government's commitment to continuously giving full support to improve Indonesia's investment climate.

"As the Coordinating Minister said previously, we'll continue to support the infrastructure, we'll support ease and certainty of doing business as well as human resource availability according to the needs of the industries. This way, the Gresik KEK will advance, and Indonesia will become a more desirable destination for investment," the President confirmed.

The groundbreaking affirms PTFI's commitment to build a smelter, in accordance with the divestment agreement made in 2018. "The construction of smelter is mandated by the Special Mining Business License (IUPK) of PTFI which forms an inseparable part of the PTFI's license to continue operations until 2041," said President Director of PTFI, Tony Wenas.

The copper concentrate supplied to the smelter will come from the largest underground mine in the world managed by PTFI. Up to 98% of PTFI's employees come from various ethnic groups and areas in Papua and other provinces in Indonesia.

PTFI is cooperating with PT Chiyoda International Indonesia for the Engineering, Procurement, and Construction (EPC) work during the construction phase. This phase will create jobs for at least 40,000 people (cumulatively), who are recruited by building contractors. PTFI will encourage the building contractors to recruit as many locals as possible to fill certain jobs.

"We would like to thank Mr. President and the ministers for their full attention to this groundbreaking ceremony. We also expect your support for ease of licensing and fiscal incentives to support the economies of scale of this smelter project," said Tony.

A number of state ministers attended the ceremony, namely Coordinating Minister for Economy Airlangga Hartarto, Minister of Energy and Mineral Resources Arifin Tasrif, Minister of State-Owned Enterprises Erick Thohir, Minister of Industry Agus Gumiwang Kartasasmita, and Cabinet Secretary Pramono Anung. East Java Governor Khofifah Indar Parawansa and Gresik Regent Fandi Akhmad Yani were also present.

For the record, PT Freeport Indonesia is a part of MIND ID, the Indonesian holding company for state-owned miners. Indonesia itself is one of the seven countries in the world with the largest copper reserves. (IY)

Head of Bureau of Communication, Public Information Services, and Cooperation

Agung Pribadi (08112213555)

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