Freeport to boost copper supply to its Spanish sister firm
Freeport to boost copper supply to its Spanish sister firm
JAKARTA (JP): PT Freeport Indonesia (FI), the Indonesian
copper and gold mining subsidiary of Freeport-McMoRan Copper and
Gold Inc. (FCX) of the United States will provide its Spanish
sister company, Rio Tinto Minera S.A. (RTM), with approximately
one half of its copper concentrate requirements in 1996.
FCX said in a statement made available yesterday that the
copper concentrate to be supplied to the RTM smelter will account
for around 30 percent of FI's expected production.
FI is providing the RTM smelter with approximately 150,000
tons of concentrate in 1994.
RTM, also a FCX subsidiary, has recently accepted a project
financing offer from Barclays Bank Plc for US$270 million
primarily related to the $215 million expansion program of its
copper smelter and refinery complex, located near Huelva, Spain.
This project financing, which is non-recourse to FCX, will
also provide funds for refinancing RTM's gold loans and working
capital loans.
The expansion design and construction are being managed by
Lurgi AG, a German engineering firm, on a fixed-price turnkey
basis.
Plan
FI earlier announced a plan to construct a copper smelter in
Gresik, East Java, as part of the prerequisites set by the
Indonesian government for the extension and expansion of its
mining contract in Irian Jaya.
Jens-Peter Schaefer, the president of Lurgi AG, told newsmen
during his visit to Indonesia earlier this year that the final
decision on the $600 million project will be made in the second
quarter of this year. The planned smelter will be designed to
produce 150,000 tons of copper metal annually.
Lurgi will own a 55 percent stake in the project, which will
be the first copper smelter in the country. FI will have another
20 percent and Nippon Mining Company Ltd. of Japan will hold the
remaining 25 percent.
Construction of the copper smelter was originally planned to
start in March last year but it was then postponed last August.
The start of the construction was delayed again due to the German
shareholder's financial difficulties.
Freeport, therefore, announced recently that it will take over
the leadership of the copper smelting project in Gresik.
Meanwhile, an Indonesia-New Zealand joint venture, PT Copper
Smelter, announced early last month that it would also set up a
copper smelter in Gresik, with an investment of around $648
million. The company will also produce around 150,000 tons of
copper metal annually. (hen)