Jakarta, Indonesia Sentinel — The Indonesian government has decided to extend PT Freeport Indonesia’s (PTFI) copper concentrate export permit until June 2025, following the expiration of its previous license on December 31, 2024.
Energy and Mineral Resources Minister (ESDM) Bahlil Lahadalia announced the decision after a limited cabinet meeting, citing economic considerations, operational sustainability, and national interests.
“We held a meeting to evaluate all aspects, including the nation’s benefit, the company’s operations, and the welfare of the people in Papua. Legally, the export deadline was set for December 2024, but special circumstances must be considered,” Bahlil stated on Friday, February 21, as reported by Tempo.
Currently, the official permit is still being processed, while the permit will take effect after the release of the formal recommendation letter. However, Bahlil assured that the government has made its decision to approve the extension.
Export Permit
The extension comes after a fire incident at Freeport’s smelter in Gresik, which disrupted refining operations. Bahlil emphasized that the government did not grant the permit arbitrarily, highlighting that investigations by police and insurance firms confirmed the fire was accidental.
“Based on that, the government decided in a cabinet meeting that Freeport can continue exporting until the damaged smelter is repaired, which is expected to be completed by June,” he said.
Freeport’s President Director Tony Wenas has committed to completing the smelter repairs by June, and failure to meet the deadline will result in penalties. While the specific penalties have yet to be determined, the government is currently discussing possible measures.
“I have asked Tony Wenas to sign a notarized statement pledging to complete the repairs by June. If not, sanctions will be imposed,” Bahlil added.
Read Also:
Freeport Indonesia’s Smelter Fire: $3.67 Billion Project Delayed for Six Months
Bahlil also noted that the export extension will not come without conditions. Bahlil confirmed that Freeport will be subject to the maximum export tax rate as compensation.
“The export tax will be set at the highest possible rate, and this has been coordinated with the Ministry of Finance. This matter involves multiple ministries, including Trade, Finance, and Energy and Mineral Resources,” he explained.
Indonesia’s Ban on Raw Material Exports
Indonesia has implemented a ban on raw material exports to encourage companies to build domestic smelting facilities, aiming to boost the value of exports and support downstream industries.
However, due to the fire incident on its smelter facilities, Freeport had applied for an extension of its export permit for 2025. “We remain optimistic that the permit will be granted, but the process is still ongoing,” Tony Wenas said on February 18.
In addition, Freeport’s copper concentrate is currently piling up in storage, limiting production to just 40% of full capacity. However, Tony expressed confidence that operations will resume as planned, with the smelter expected to start functioning again by the fourth week of June, gradually increasing output to 100% by December 2025.
(Raidi/Agung)
