Freeport to cut copper output

Freeport to cut copper output

JAKARTA (JP): Mining giant PT Freeport Indonesia, a subsidiary
of the U.S. mining firm Freeport McMoRan Copper & Gold, is
planning to reduce its copper production at its Grasberg mine in
Irian Jaya by 14 percent to 1.5 billion pounds this year from
1.75 billion pounds last year.

Freeport McMoRan's chief executive officer (CEO) James Moffett
said on Saturday the company estimated that its gold production
for this year would be approximately the same as last year's
which reached three million ounces.

Moffett, however, refused to explain the reason behind the
planned decrease in copper output.

"The production will go up and down as we move around,"
Moffett told journalists after meeting President B.J. Habibie
here.

Freeport has been applying for the government's approval to
boost its daily ore output to 300,000 tons from 160,000 tons at
present.

But, the Ministry of Mines and Energy has not yet approved the
expansion plan despite the fact that Freeport had received an
environmental impact analysis certificate from the Ministry of
Environment and had invested a lot of money for the expansion
plan.

According to Moffett, Freeport's copper output from Grasberg
rose by 51 percent to 1.74 billion pounds last year from 1.16
billion pounds in 1997.

Gold production from the mine jumped by 66 percent to three
million ounces last year from 1.8 million ounces in 1997.

The Grasberg mine is believed to contain one of the world's
largest copper and gold reserves.

Freeport Indonesia estimated in 1997 its mine to contain
recoverable copper reserves of 37.8 billion pounds and those of
gold of 51.3 million ounces.

Freeport Indonesia is 81.28 percent owned by Freeport McMoRan,
which is listed on the New York Stock Exchange, 9.26 percent by
the Indonesian government and 9.36 percent by PT Indocopper
Investama Corporation.

Indocopper, which is listed on the Surabaya Stock Exchange, is
50.48 percent owned by Nusamba Mineral Industries, 49 percent by
Freeport McMoRan and 0.52 percent by public minority
shareholders.

Nusamba Mineral is owned by the Nusamba group controlled by
Mohamad "Bob" Hasan, a golfing buddy of former President
Soeharto. (jsk/prb)