Freeport Officially Applies for IUPK Extension, Here Is the Trigger
PT Freeport Indonesia (PTFI) has submitted an application to extend its Special Mining Business Permit (IUPK), which is currently set to expire in 2041. The application follows the company’s identification of potential mineral reserves that are projected to remain mineable until 2061.
PTFI President Director Tony Wenas said the application was made to secure long-term investment certainty for the company’s underground mine in Papua. Accelerating the continuation of the company’s IUPK is considered important so that exploration of resources at deeper levels can be carried out promptly without reducing production capacity.
“If our IUPK is extended, we will immediately conduct detailed exploration of the resources beneath it so that we can continue mining beyond 2050, possibly until 2061,” he said in Tembagapura, Central Papua, in CNBC Indonesia’s Mining Zone programme, quoted on Monday (24/8/2026).
Currently, the mineral reserves managed by PTFI in the Grasberg Block Cave (GBC) underground mine are estimated to be sufficient for operations until 2050. However, the company has found indications of 3 billion tonnes of resources beneath the existing working area that would require up to 15 years of development before they can be brought into production.
“There are 3 billion tonnes of resources beneath it. If we work on them and convert them into reserves, we could get around 1.5 billion tonnes. At a mining rate of 75 million tonnes per year, or around 200,000 tonnes per day, that would add another 20 years,” he explained.
The IUPK extension process is also linked to the company’s plan to continue investing in the new Kucing Liar mine block, which will cost up to Rp 72 trillion. The government has agreed to an additional divestment requirement of 12% of shares to Indonesian parties, which will take effect from 2041.
“This step is very important to ensure mining conservation, long-term investment sustainability, safeguarding jobs for around 30,000 workers, and maintaining contributions to the state amounting to tens of trillions, potentially reaching hundreds of trillions of rupiah each year,” he stressed.
The Indonesian government, Freeport-McMoRan and PT Freeport Indonesia signed a Memorandum of Understanding (MoU) regarding the extension of PTFI’s IUPK on 18 February 2026 in Washington DC, United States.
The MoU covers plans to amend PTFI’s Special Mining Business Permit, which 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 downstream processing 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 at no cost in 2041, provided the acquiring party reimburses FCX’s pro-rata costs 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 onwards.
Freeport-McMoRan Chairman Richard C. Adkerson and 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 would 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 opportunities 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 will follow the issuance of a revised IUPK by the Indonesian government. The company plans to complete the extension application process promptly in accordance with the agreed requirements.