• 4 minutes "Saudi Armada heading to U.S.", "Dumping" is a WTO VIOLATION.
  • 7 minutes Trump will be holding back funds that were going to W.H.O. Good move
  • 11 minutes Washington doctor removed from his post, over covid
  • 15 minutes Which producers will shut in first?
  • 7 hours Why Trump Is Right to Re-Open the Economy
  • 23 mins A small trial finds that hydroxychloroquine is not effective for treating coronavirus
  • 2 hours Sharp real pure true hard working roughneck needing work..
  • 23 mins Charts of COVID-19 Fatality Rate by Age and Sex
  • 32 mins Russia's Rosneft Oil is screwed if they have to shut down production as a result of glut.
  • 8 mins Corona Price Tag
  • 18 hours Wouldn't fall in demand balance it out?
  • 14 hours US Shale Resilience: Oil Industry Experts Say Shale Will Rise Again
  • 2 hours Bernie Sanders introduces bill to ban fracking
  • 4 hours 80's GOM Oil Fam: Mid-80's Oil Glut Part Deux?
  • 7 hours CCP holding back virus data . . . . . . Spanish Flu 1918 MUTATED, Came in 3 waves, Lasted 14 months and killed upward 5% World population
  • 13 hours Its going to be an oil bloodbath
Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Will This Bureaucratic Battle See Prime Copper Assets Coming For Sale?

Very interesting drama unfolding in one of the world’s top mining nations the last few weeks.

That’s Indonesia — where a top copper miner is grappling with its future in the country.

The firm is Freeport McMoRan. Which late last week once again ran afoul of Indonesian authorities over exports of copper concentrate from the company’s mines.

Freeport had been exporting copper under a temporary license from the Indonesian government. A measure that became necessary after Indonesia imposed an export ban on unprocessed minerals in late 2013. Related: Russia Cries Dyadya (Uncle), Is Saudi Arabia Listening?

Since then, Freeport had been allowed a temporary export license after pledging to pursue the construction of a copper smelter in Indonesia.

But the company’s latest export permit expired last Thursday. And reports suggest the Indonesian government has refused to renew this key permission.

And a few things happened right before the permit expiry, which make this case extra complicated.

For one, Indonesian officials had demanded that Freeport deposit $530 million for construction of a smelter. An amount the company says was not part of its contract with the government. Related: Politics & Oil - What The President Failed To Mention In His Address To Congress

Another key event has been recent demands by Indonesia that Freeport sells a 10.64 percent stake in its Grasberg mega-mine to the government. Which Freeport said in mid-January it would be willing to vend for $1.7 billion.

The government subsequently said that offer was overpriced. Suggesting officials will play hardball on the amount for this purchase.

With both of those issues still in limbo, it’s not surprising the government has halted Freeport’s export permissions. Company officials said Monday that operations are still running as usual at the Grasberg mine — but it appears that copper ore may be headed for stockpile rather than sale here for the next while. Related: Banks On The Hook For Bad Energy Loans

At the same time, some interesting reports have emerged on Freeport in local newspapers in a completely different part of the world: Chile. Suggesting the firm may be looking at selling its 51 percent interest in the massive El Abra mine here.

Such a move could be aimed at raising some of the cash necessary to resolve the Indonesia situation. With local Chilean papers naming state copper miner Codelco as a possible buyer of El Abra.

Watch to see if this emergency mine sale does materialize — and who the potential bidders and buyers are. This could mean a high-quality asset coming available to the market.

Here’s to crisis and opportunity

By Dave Forest

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage






Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News