Papua Provincial Government and Timika Regency Government to be Involved in the Discussion of 51 Percent Divestment

The Government will involve Papua Provincial Government and Timika Regency Government as the owners of Grasberg Mine which at the moment is managed by PT Freeport Indonesia, to discuss the 51 percent divestment. This statement was made by Minister of Energy and Mineral Resources Ignasius Jonan in Jakarta, last Monday (4/9).

“Papua Provincial Government and Timika Regency Government will be invited to discuss together the 51 percent divestment of PT Freeport Indonesia’s shares. It is still under negotiation whether the Papua Provincial Government and Timika Regency Government will get 5 percent or 10 percent. The point is, both regional governments will surely be invited to discuss this issue since they are the owners,” the Minister firmly said.

Minister Jonan delivered this statement inresponse to the readiness of PT Freeport Indonesia to divest 51 percent of its shares to the Government of Indonesia as an implementation of Government Regulation Number 1 of  2017 on Fourth Amendment to Government Regulation Number 23 of 2010 on Business Activities of Mineral and Coal Minings.

As previously reported, PT Freeport Indonesia has agreed to divest 51 percent of its shares to Indonesian Government. In addition, the Company has also agreed to build smelter facilities for five years or has to be completed no later than October 2022.

The agreement was reached in a meeting between the Negotiation Team of the Government and PT Freeport Indonesia, at the Ministry of Energy and Mineral Resources, Jakarta, Sunday (27/8). This meeting was attended by Minister of Energy and Mineral Resources Ignasius Jonan and Minister of Finance Sri Mulyani Indrawati, as well as the CEO of Freeport McMoran Richard Adkerson and Board of Directors of PT Freeport Indonesia.

Regarding the procedures of share purchase, Jonan stated that the Government can appoint State-Owned Enterprises, in a consortium, to carry out the 51 percent divestment.

Indonesian Sons and Daughters

The Minister firmly said that President Joko ‘Jokowi’ Widodo always believes that one day Indonesia’s resources must be managed by its own people. This is a stepping stone (the Freeport issue) to start to overcome the challenges.“Same with Mahakam Block. After the contract with Total expired, it is now managed by Pertamina. I have told Pertamina to maintain the production so it does not decline, and to maintain the production cost so it will not rise. We have to make sure that we can manage it well,” Jonan said.(Humas ESDM/ES) (MMB/YM/Naster)