PHOENIX--(BUSINESS WIRE)-- Freeport-McMoRan Inc. (NYSE: FCX) today provided an update on PT Freeport Indonesia's (PT-FI) negotiations with the Indonesian Government regarding PT-FI’s long term operating rights.
FCX and the Government of Indonesia have reached an understanding on a framework to support PT-FI's long-term investment plans in Papua. This framework, which will require definitive documentation and FCX Board and partner approvals, includes the following key terms:
- PT-FI will convert its Contract of Work to a special license (IUPK) which will provide PT-FI with long-term operating rights through 2041.
- The Government will provide certainty of fiscal and legal terms during the term of the IUPK.
- PT-FI will commit to construct a new smelter in Indonesia within five years.
- FCX will agree to divest its ownership in PT-FI at fair market value so that Indonesia interests own 51 percent of PT-FI's shares. The timing and process of divestment is being discussed with the Government. The divestment will be structured so that FCX will retain control over operations and governance of PT-FI.
Richard C. Adkerson, President and Chief Executive Officer, said: “We are pleased to announce an agreed framework to support our ongoing operations and investment program in Papua. Reaching this understanding on the structure of a mutual agreement is significant and positive for all stakeholders. Important work remains on documenting this agreement and we are committed to completing the documentation as soon as possible during 2017.”
FCX is a leading international mining company with headquarters in Phoenix, Arizona. FCX operates large, long-lived, geographically diverse assets with significant proven and probable reserves of copper, gold and molybdenum. FCX is the world’s largest publicly traded copper producer.
FCX’s portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits; significant mining operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America. Additional information about FCX is available on FCX’s website at “fcx.com.”
