Demand for Freeport contract review blasted
Demand for Freeport contract review blasted
JAKARTA (JP): A legislator criticized on Thursday two commissions of the House of Representatives for recommending on Tuesday a review of the contract of work held by copper and gold mining company PT Freeport Indonesia.
Head of the House's Commission VIII for mines and energy Irwan Prayitno said the Commission I for defense, security and foreign affairs and the Commission II for home and legal affairs had gone beyond their authority by making such a recommendation.
He said the responsibility to make such a recommendation lay with the commission he headed.
Consequently, the recommendation could not be taken as official but only "an input", Irwan was quoted by Antara as saying.
However, he did not mention if his commission would turn down the recommendation.
Commission I and II asked on Tuesday for the government to review its contract with mining company PT Freeport Indonesia, saying the deal violated investment regulations and the 1945 State Constitution.
Both commissions said the government received too little share of the revenue from the company's operation, asking the government to review the contract to ensure that it would receive fairer revenue sharing.
Following a visit to the company's copper and gold mine in Grasberg, Irian Jaya, the two commissions concluded that the mining operations had also resulted in socioeconomic injustice, rampant human rights abuse and political tension.
Freeport Indonesia is 81.28 percent owned by U.S. mining company Freeport McMoRan Copper & Gold with the Indonesia government and PT Indocopper Investama Corporation holding each a 9.36 percent stake in the company.
Indocopper is 50.48 percent owned by Nusamba Mineral Industries, which is linked to former president Soeharto. Freeport McMoran hold a 49 percent stake in Indocopper and the investing public hold 0.52 percent.
No confidence
Separately, member of the Commission VIII Pramono Anung said on Thursday the House should give "vote of no confidence" to Freeport's contract to pressure the company to be willing to renegotiate its contract.
He blasted the company for lack of transparency in many aspects.
He said Freeport had never reported the number of vessels that carried its copper and gold ore from Irian Jaya to smelters in Indonesia and abroad.
Freeport also never revealed the percentage of gold, copper and silver contents of the ore.
"Freeport has never permitted any surveyor to take sample ores from the vessels transporting the ores. No government official observes the company's operation from mining activities to ore shipment," Anung said.
He also said Freeport had never audited the fund it provided for the development program of the local community.
According to Anung, Freeport allocated 1 percent of its sales for the fund every year.
He also blasted the environmental destruction caused by Freeport's operation, doubting the audit results of American auditor Montgomery Watson which lauded the environmental protection of Freeport as "exemplary".
"How come? That's a big question given the fact that mangrove trees with the height of four meters die from being buried by the company's tailings," Anung said. (jsk)