Freeport to fund new copper project

Freeport to fund new copper project

SCOTTSDALE, Ariz (Reuter): Freeport McMoRan Copper and Gold
said it is close to concluding a finance package to fund a new
200,000 ton copper smelter and refinery in Gresik, East Java.

Freeport's vice-president of finance, Robert Wohleber, said
the company is in the detailed process of arranging and
completing finance for the new $650 million smelter. "I would say
we would hope to have this completed mid-part of this year,"
Wohleber said. He would not indicate the financial institutions
involved in the talks, but the final package would have some
Japanese financing.

Freeport McMoRan has a majority stake in PT Freeport
Indonesia, the subsidiary which will have a 20 percent stake in
the new Gresik smelter and refinery. Fluor Daniel Asia has a 10
percent stake, with Mitsubishi Materials 70 percent.

"We project mid-1996 for construction to begin, and completion
we are seeing in 1998, in the second half," Wohleber said.

Gresik will be financed by a mixture of borrowings from the
lender group, and equity contributions from the three
shareholders.

At the present time Freeport operates a large copper mine in
Indonesia but has no smelting and refining capacity there,
recently expanded output at its RTM smelter in Spain.

Robert Zwerneman, Freeport's director of market research and
analysis, said here during the American Copper College meeting
that global copper demand was expected to rise 3.5 percent this
year with a supply surplus of 175,000 tons.