Jakarta, Indonesia Sentinel — Indonesia recently inaugurated the world’s largest single-line copper smelter, operated by PT Freeport Indonesia (PTFI). Located in the Java Integrated Industrial and Ports Estate (JIIPE) Special Economic Zone in Gresik, East Java, this new facility enhances Indonesia’s position in global copper processing.
Freeport now operates two copper smelters, collectively capable of processing up to 3 million tons of copper concentrate annually, resulting in approximately 1 million tons of copper cathodes, as well as 50 tons of gold and 220 tons of silver per year.
This newly launched smelter, with a processing capacity of 1.7 million tons of copper concentrate annually, is recognized as the largest single-line copper smelter worldwide. PTFI’s first smelter, managed by PT Smelting—a joint venture with Japan’s Mitsubishi Materials Corporation—has been operational for years, with PTFI recently increasing its stake to 66.02%, while Mitsubishi holds 33.98%.
The copper produced at PTFI’s smelters is primarily destined for export markets, including China, the U.S., and several European countries. However, PTFI has also begun establishing relationships with domestic buyers. The first major domestic offtaker is PT Hailiang Group, a Chinese copper foil manufacturer that will absorb around 100,000 tons of copper cathodes annually. Hailiang plans to establish its facility close to PTFI’s smelter in JIIPE, reinforcing Indonesia’s ambitions to support domestic industry growth.
In addition to copper, PTFI has secured a local buyer for a portion of its gold production. Today, a significant sales agreement will be signed with PT Aneka Tambang Tbk (ANTM), part of Indonesia’s state-owned mining holding company MIND ID. Antam has committed to purchasing 20 tons of gold annually from PTFI’s output, as confirmed by Hendi Prio Santoso, CEO of MIND ID, in a statement to CNBC.
Hendi remarked that Indonesia’s copper and gold production provides a solid foundation for downstream industrialization, supporting local industries that could benefit from locally sourced raw materials.
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While the majority of copper cathodes will continue to be exported in the short term, Hendi expressed optimism for future domestic sales as Indonesia’s industrial capacity expands. “When more domestic manufacturing facilities open, we’ll be ready to supply raw materials. This is part of our long-term goal,” Hendi explained.
Indonesia’s President Joko Widodo highlighted the potential economic impact of PTFI’s expanded operations, estimating that the government could receive as much as 80 trillion rupiahs (around $5 billion USD) annually from PTFI in economic benefits.
(Becky)
