1Berita – President Joko Widodo (Jokowi) has revealed the substantial increase in government revenue if Indonesia manages to acquire 61 percent of shares in PT Freeport Indonesia (PTFI).
He stated that 80 percent of Freeport’s income would flow into the state budget if the government becomes the majority shareholder.
Currently, Indonesia holds 51 percent of PTFI shares and plans to increase it by an additional 10 percent.
“We will soon increase it to 61 percent. Currently, 70 percent of Freeport’s income goes to the country. Once we reach 61 percent, 80 percent will go to the country,” he said during his address at the 12th Hikmahbudhi Congress in Ancol, North Jakarta, on Thursday (3/28).
He emphasized that Indonesia’s gradual increase in share ownership in Freeport is a phased process. Initially, Indonesia only had 9 percent ownership. Through lengthy negotiations, it was agreed that Indonesia would take over 51 percent of PTFI shares.
Jokowi also reminded that with the current 51 percent ownership, Freeport is effectively under Indonesian control.
“Now we already have the majority at 51 percent. It means Freeport is no longer owned by America; it belongs to Indonesia, our country,” he stated.
“Do not have the impression that it belongs to America; it’s already Indonesia’s. Soon we will increase it to 61 percent,” he concluded.
However, he admitted that acquiring the additional 61 percent of shares is not an easy task, and the process is still ongoing. Negotiations are particularly challenging.
“It’s still in the negotiation process, and also preparing the regulations, but I believe we can achieve that figure (61 percent). Negotiations have been ongoing for a long time; it’s really tough,” he said.
According to Jokowi, the initial focus is on extending PTFI’s contract in Indonesia. It is targeted to be completed no later than June 2024.
“We need to finalize the regulations first before the negotiations can be concluded promptly. But I see, I targeted it to be completed by June, if possible, sooner but no later than June,” he explained.
Earlier in the day, Jokowi met with Freeport McMoran Inc CEO Richard Adkerson at the Presidential Palace.
The top brass of Freeport came along with key figures such as PT Freeport Indonesia CEO Tony Wenas and PT Freeport Indonesia’s Board of Commissioners, also CFO of Freeport McMoran Kathleen Quirk.
Tony mentioned that they briefly discussed the extension of Freeport’s mining permit, which is set to expire in 2041.
“We touched on the extension of the permit for Freeport a bit, but didn’t delve into details, as the time isn’t long, and it had been discussed previously,” Tony said.
Additionally, their meeting with President Jokowi also discussed the progress of the construction of PT Freeport Indonesia’s smelter in Manyar, Gresik Regency, East Java, which is expected to start operations by mid-2024.
“Especially the progress of the smelter, which has reached over 92 percent completion, with hopes of finishing it in May and starting operations in June this year, and it will be in full production in 2024,” he said.
