Indonesia to sign sales and purchase agreement on Freeport

Courtesy of/PT Freeport Indonesia

 

The government and American mining giant Freeport-McMoran (FCX) plan to sign a sales and purchase agreement on Thursday afternoon in what would be another step toward majority ownership of PT Freeport Indonesia (PTFI) by state-owned mining holding company PT Indonesia Asahan Aluminium (Inalum).

The agreement is one of three required for the divestment process of PTPI’s shares. The two other agreements, which could also be signed on Thursday, are on information exchange and shareholders.

The sales and purchase agreement is likely to lay out details on the disbursement of US$3.85 billion for Australian miner Rio Tinto’s participating interest in PTFI and $350 million for FCX’s shares in PTFI by Inalum as agreed upon in a previous document.

The deal was initially to be made on Wednesday as the government had sent out invitations for an event, but the event was canceled without any clarification.

Meanwhile, on Wednesday morning, the United States Embassy issued a press release regarding the visit of US Ambassador to Indonesia Joseph R. Donovan, Jr to PTFI’s site in Mimika, Papua, from Sept. 21 to 24.

Donovan emphasized his support for President Joko “Jokowi” Widodo’s vision of a “win-win” outcome that would see a contract extension for the operation of the gold and copper mining site in the easternmost Indonesian province.

“I head back to Jakarta with an improved understanding of the need for a timely resolution to negotiations over Freeport’s operating rights extension,” he said.

The three agreements are a follow-up to a heads of agreement signed on July 12 by Inalum and FXC

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