State enterprises ready to acquire 51% stake in Freeport

Jakarta (ANTARA News) – State Enterprises Minister Rini Soemarno has expressed her confidence that the government will be able to acquire a 51 percent stake in PT Freeport Indonesia.

“If the state-run enterprises are tasked with acquiring shares in PT Freeport divestment, we will be ready. Now we have to wait for the valuation process,” Rini said on the sidelines of the Telkom Craft exhibition here on Friday.

Before the divestment, she said, the government and U.S. mining firm should finalize their negotiation on the contract.

“Technically, the divestment process would be handled by the Energy and Mineral Resource Ministry. After it is finished, state-run enterprises would be ready to buy 51 percent of Freeport shares,” she added.

The establishment of a holding company for state-run mining firms-PT Inalum, Bukit Asam, Aneka Tambang and Timah-which is expected to be finalized in 2017, would support the divestment.

“With this holding company in mining, Inalum will get support from three other state-run firms,” Rini said.

The government has asked PT Freeport to change its status from a Contract of Work (CoW) to a special mining license (IUPK), under the government regulation No. 1/2017 on mineral and coal mining.

As a consequence, PT Freeport is required to divest 51 percent of its shares.

Responding to the demand, the U.S.-based firm has threatened to bring the case under international arbitration.

A legislator from the Hanura Party Djafar Badjeber said PT Freeport Indonesia should choose the negotiation process before it opts for international arbitration.

“They should abide by Law no. 4/2009 on mineral and coal mining. Freeport should abide by regulations issued by the government of Indonesia,” he said.

Source: Antara News