Freeport, Mitsubishi to start joint project

Freeport, Mitsubishi to start joint project

JAKARTA (JP): PT Smelting Company, a joint venture between PT
Freeport Indonesia and Japan's Mitsubishi Corporation, will start
construction of a copper smeltery in Gresik, East Jakarta, next
month.

Adri Machribie, the president of Freeport Indonesia, said
yesterday that Vice President Try Sutrisno would lay the
smeltery's foundation stone.

Speaking to journalists after a meeting with the Vice
President, Machribie said PT Smelting Company would invest US$700
million into the plant, which would have an annual production
capacity of 200,000 tons of cooper cathodes.

He said the plant is expected to start commercial production
in early 1999.

Freeport holds a 25 percent stake in the smeltery. Mitsubishi
holds the rest.

Mitsubishi will operate and manage the plant, and market its
products. Freeport Indonesia, a subsidiary of the American
McMoRan Copper and Gold Inc. will supply copper concentrates as
raw materials.

Machribie said Indonesian copper concentrates from Freeport
Indonesia are presently processed in Japan, Spain and the
Philippines.

"With the establishment of the copper smeltery in Gresik,
Indonesia will be able to process its own mineral resources," he
said.

Shunichi Ajima, the president of PT Smelting Company, said the
smeltery would enable Indonesia, which presently imports 60,000
tons of copper a year, to save on foreign exchange.

He said as many as 700 Indonesian smelters would be trained in
Japan to run the plant, the first copper processing facility in
the country.

Freeport McMoran currently holds 80 percent equity in Freeport
Indonesia, which signed a work contract with the government in
1967. It began to mine copper and gold in the eastern province of
Irian Jaya in 1973. The government and a private firm hold the
remaining shares.

Freeport has a concession area of 2.6 million hectares after
an extension of its contract in 1991.(hen)