Freeport Halts Operations Due to Post-strike Worker Squabble

From Joyo
The Jakarta Post | Wednesday, February 29, 2012

Freeport Halts Operations Due to Post-strike Worker Squabbles

Rangga D. Fadillah, The Jakarta Post, Jakarta

Tribunnews.comTribunnews.comPT Freeport Indonesia (PTFI) says that production at its Grasberg gold and copper mine in Timika, Papua, remains temporarily halted following several incidents of worker-on-worker violence last week.

PTFI executive director Sinta Sirait said the company was in talks with union to resolve the problem, but could not predict when an agreement could be reached and operations could resume.

'We'll consider anything that can calm the situation. We also aim to continuously maintain good communication with the workers so that agreement can be reached,' Sinta told reporters on the sidelines of a discussion at the Energy and Mineral Resources Ministry in Jakarta on Tuesday.

As reported earlier, Freeport halted operations at Grasberg on Feb. 23 following reports of violence and intimidation directed at workers who did not participate in last year's three-month strike by those who did.

The company can produce 230,000 tons of gold and copper concentrate a day under usual conditions.

According to the workers' union the squabbles erupted after Freeport failed to pay striking workers back pay based on the Dec. 22 agreement, leading the aggrieved workers to attack their peers who did not strike.

The union demanded that officials at the Grasberg mine be fired for failing to create a conducive environment for reconciliation.

On renegotiating Freeport's contract with the central government, Sinta said the company was ready to discuss amendments and contract implementation.

'We're willing to discuss all the contents of the contract. Generally, we agree with the renegotiation, but we'll leave the details to the government,' she said.

When asked if the renegotiation request would influence the company's investments in Indonesia, Sinta said that by sitting down with the government, there would be a mutual understanding between the two parties.

'For us, dialog and communication with the government are very important,' Sinta said.

The government is currently renegotiating all of its mining contracts, as mandated by the 2009 Minerals and Coal Law.

There are six main issues to be discussed when revising contracts, namely the size of mining concession areas, the length of contract extensions, the amount of royalties to be paid to the central and local governments, obligations to process raw materials in Indonesia, divestment and the use of local goods and services.

Sinta declined to comment on a ban on raw material exports starting in 2014, as stipulated by the Minerals and Coal Law.

'It's part of our discussions with the government,' Sinta said.

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