JAKARTA (Reuters) – Indonesia President Joko Widodo has instructed his administration to complete negotiations over the purchase of a majority stake in Freeport-McMoRan Inc’s local unit by the end of April, a cabinet minister said late on Monday.
“It should be wrapped up before the end of April, valuation and all,” Energy Minister Ignasius Jonan told reporters, referring to directions from President Widodo.
Indonesia cannot simply wait until Freeport’s current mining contract expires in 2021 and then take ownership of its Grasberg copper mine, Jonan said.
“Freeport would still go to arbitration,” he said, while the government would also need to repay Freeport for all of its investments in the mine.
Instead, the government, through a state-owned company, plans to buy a majority stake in PT Freeport Indonesia at “a reasonable price”, including the purchase of Rio Tinto’s participating interest in the massive Grasberg mine and converting it into shares, he said.