TEMPO.CO, Jakarta - The divestment of Freeport Indonesia's shares has entered a new phase. Freeport McMoran, the owner of 48.8 percent of Freeport Indonesia's shares, is finally willing to sell back the 10 percent stake it holds to a national company. This is a sign that domestic entities will be increasingly dominant in the ranks of Freeport Indonesia's shareholders.
The agreement emerged during a meeting between President Joko Widodo and Freeport McMoran Chief Executive Officer Richard Adkerson in Washington D.C., United States, on November 13. At that time, Jokowi and Adkerson discussed the continuation of Freeport Indonesia's business, which holds a special mining business license (IUPK) until 2041.
According to some information, three things were agreed upon during the meeting. The first is the release of an additional 10 percent of shares to Mind Id as a national entity in the ranks of Freeport Indonesia shareholders. When this happens, Mind Id will control 61.2 percent of the shares. This share release is a continuation of the divestment that took place in 2018.
The second agreement is that the government wants to extend Freeport's IUPK for 20 years. If this happens, Freeport Indonesia will have an IUPK until 2061.
The third agreement is the construction of a copper processing smelter in West Papua. However, this agreement is questionable considering that there are potential violations of the rules. In addition, there are allegations of ethical violations because Jokowi makes an agreement that should have been the authority of another president.
What is the full story? Read the November 27, 2023 edition of Tempo English weekly.
Readers, in this edition, we also write reports on the mutual attacks between the Corruption Eradication Commission (KPK) and the Police after Jakarta Police named KPK Chair Firli Bahuri as a suspect of an extortion case involving former minister of agriculture, Syahrul Yasin Limpo. Syahrul is also a suspect in an extortion case towards his subordinates.
We also present other reports and one of them is the pressures and intimidations experienced by the presidential candidates team before the election.
Enjoy reading..
Bagja Hidayat
Executive Editor of Tempo
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Freeport Divestment
The Indonesian government promises to extend Freeport’s permit if the company releases more shares. A premature extension of the permit would violate regulation.
Freeport Indonesia’s Smelter Project
Freeport Indonesia is pressured to finish the smelter project in Gresik. The project is behind schedule despite the company already obtained the export permit for concentrate.
Freeport’s Contribution to the State
Freeport aims for an increase in dividend payments. The addition of shares promises control over operations and benefits for the state.
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