JAKARTA: US mining giant Freeport McMoRan Copper and Gold Inc halted its copper exports from Indonesia, less than an hour before a controversial mineral export ban comes into effect, a union official said yesterday.
Indonesia today will impose a ban on more than $10bn worth of annual copper, nickel and other unprocessed mineral ore shipments, a move that industry officials warn could lead to mass layoffs, mine closures and depleted foreign revenue.
The Southeast Asian nation is the world’s biggest exporter of nickel ore, refined tin and thermal coal and home to the fifth largest copper mine and top gold mine.
The ban aims to boost Indonesia’s long-term return from its mineral wealth, but officials fear a short-term cut in foreign revenue could widen the current account deficit, which has undermined investor confidence and battered the rupiah.
President Susilo Bambang Yudhoyono and cabinet ministers met yesterday to discuss whether to approve last-minute regulations that would ease the ban. “There will be no concentrate exports from Freeport Indonesia in Papua as long as there is no government policy providing certainty on concentrate exports,” said union official Virgo Solossa, adding that the firm has not made a shipment from its port since December 15.
Company spokeswoman Daisy Primayanti said Freeport continued to ship copper to its local smelter for use domestically. “We hope the government will issue the new implementing regulations soon,” she said.
Freeport, the country’s dominant copper produce with 73 percent market share, last month warned an unrevised ban would cut output at its Grasberg mine by 60 percent and lead to layoffs of half of its 15,000 Indonesian employees.
Reuters
