Freeport Boss Reveals Reasons for IUPK Extension Application After 2041

PT Freeport Indonesia (PTFI) has submitted an application for an extension of its Special Mining Business Permit (IUPK) beyond 2041 to the government through the Ministry of Energy and Mineral Resources (ESDM). PTFI President Director Tony Wenas explained that the application follows up on a memorandum of understanding (MoU) signed in February 2026. The IUPK extension application was submitted in June 2026.

One of the reasons, he stressed, is the importance of certainty over continued operations, so that the company can maximise the potential of mineral reserves that are still considered abundant, particularly in the Grasberg district, Tembagapura, Mimika Regency, Central Papua.

“This step is very important to ensure mining conservation, long-term investment sustainability, safeguarding jobs for around 30,000 workers, maintaining contributions to the state amounting to tens of trillions and potentially reaching hundreds of trillions of rupiah each year, and of course continuing our community development programmes in the future,” he said in a speech at PTFI’s 81st Indonesian Independence Day ceremony in Tembagapura, Mimika Regency, Central Papua, on Monday (17/8/2026).

According to him, the extension of PTFI’s IUPK after 2041 will also provide contributions to the state. By the end of 2026 alone, PTFI is targeting payments to the state of at least Rp 47 trillion. If the IUPK is extended after 2041, Tony has previously said that PTFI would contribute around US$6 billion, or approximately Rp 90 trillion per year, to the state. That is based on current commodity price assumptions. If prices rise, the contribution to the state is expected to be even larger.

“The point is that if the mine stops in 2041, no one benefits. The government also loses because there is no more revenue from Freeport, the 30,000 employees would be gone, and our community development programmes would be gone. So if it is extended, all parties benefit,” he added.

The certainty of the IUPK extension until 2041 is also in line with the development of the Kucing Liar underground mine project, which requires a total investment of Rp 72 trillion. This jumbo investment is considered unlikely to deliver optimal benefits for all parties if the company’s operations cease in 2041, when production is at its peak level.

Under the company’s extension application, the Indonesian government is scheduled to receive additional shares through a divestment of 12% that will take effect after 2041, or starting in 2042. The increase in the state’s shareholding will be carried out without a commercial sale and purchase mechanism, but rather through a proportional reimbursement scheme for operational costs.

“Oh, there will be another 12% divestment signed now to take effect in 2041. There is no buying and selling. There is no buying and selling, and whoever later holds the additional 12% will proportionally reimburse the costs incurred for mining after 2041. That is reasonable,” he said on the sidelines of the event.

The Indonesian government, Freeport-McMoRan and PT Freeport Indonesia signed a Memorandum of Understanding (MoU) regarding the extension of PT Freeport Indonesia’s IUPK on 18 February 2026 in Washington DC, United States. The MoU covers a planned amendment to PTFI’s Special Mining Business Permit (IUPK) that will provide operational certainty for PTFI after the current IUPK expires in 2041.

Key points of the agreement include: PTFI’s IUPK will be amended to provide an extension of resource operating rights; PTFI will increase support for communities in Papua, including financial support for a new hospital and two medical education facilities; PTFI will increase exploration spending and further studies to identify and develop long-term resources and expansion opportunities; PTFI will continue to prioritise domestic downstreaming through local sales of processed copper, precious metals, sulphuric acid and other products; and FCX will transfer 12% of its shares in PTFI to the Indonesian government in 2041 at no cost, provided the acquiring party reimburses FCX’s pro-rata costs incurred using book value for investments benefiting the post-2041 period. FCX will retain its current 48.76% ownership in PTFI until 2041 and hold approximately 37% from 2042.

Freeport-McMoRan Chairman Richard C. Adkerson and FCX President and Chief Executive Officer Kathleen Quirk expressed appreciation for the long-term partnership with the Indonesian government. They affirmed that the mining permit extension will provide opportunities to continue building substantial value for all stakeholders.

“The Grasberg operations have delivered substantial benefits to all stakeholders over their six-decade history, and this extension will provide the opportunity to continue building substantial value for all stakeholders at one of the world’s most significant copper and gold deposits,” Richard and Kathleen said in an official statement.

PTFI confirmed that the extension of operating rights and other provisions have been agreed to follow the issuance of a revised IUPK by the Indonesian government. PTFI plans to complete the extension application process promptly in accordance with the approved requirements.