MAC: Mines and Communities

Government seeks to extend Freeport mine closure

Published by MAC on 2003-10-15

Government seeks to extend Freeport mine closure


October 15, 2003

The Indonesian government could extend the partial closure of PT Freeport Indonesia's gold and copper mine in West Papua if an investigation finds that a fatal landslide last week at the mine was caused by overproduction, an official quoted by Dow Jones news wires said Wednesday (October 15).

"During the two-week closure, we will decide whether it can reopen or not," director general of mining at the Department of Energy and Mineral Resources, Wimpy S. Tjetjep told reporters.

PT Freeport Indonesia, a subsidiary of US-based Freeport McMoran Copper & Gold Inc (NYSE:FCX), which operates the giant Grasberg open pit in the remote province of Papua in Indonesia's east, has already closed for two weeks the section of the pit that collapsed burying 8 workers, 6 of whom are still missing.

Tjetjep added that overproduction would violate the production permit the government has given to the company, and the government will impose a penalty if the company is found to have violated the permit.

NGOs and environmentalists have often criticised the company for over-production that places in jeopardy workers safety and the natural environment.

Australia's Macquarie Bank estimated in a Monday report that around 20,000 metric tons of Freeport's copper production may be lost in the fourth quarter due to the current partial closure. However, other reports released this wek indicate the 3rd quarter output would remain on target.

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