Indonesia lays groundwork for transfer of Grasberg mine to local control – by Staff (Reuters U.K. – January 12, 2018)

JAKARTA, Jan 12 (Reuters) – Indonesian regional and central government officials on Friday signed an agreement with state holding company PT Inalum that lays the foundation for the transfer of Freeport-McMoRan Inc’s giant Grasberg copper mine to local control.

Indonesia and Papua have long pushed for greater control over Grasberg and the new ownership structure may ease tensions over spoils from the world’s second-biggest copper mine, which has been a focal point for local separatists.

Indonesia and Freeport agreed in principle in August to set up the U.S. company’s rights to Grasberg under a new mine license system from an existing contract of work, and the American miner said it would divest up to 51 percent of its local unit to “Indonesia interests”.

Under the agreement signed on Friday, Papua Provincial Government and the Mimika Regency will jointly own rights to a 10 percent share in PT Freeport Indonesia (PTFI) once they have been divested, the Finance Ministry said in a statement.

“This portion of share ownership rights is for the interests for the indigenous land owners and members of the community facing permanent impacts,” the statement said.

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