Govt told to review Freeport deal

JAKARTA (JP): The House of Representatives asked the government on Tuesday to review its contract with mining company PT Freeport Indonesia, saying the deal violated investment regulations and the 1945 State Constitution.

The recommendation was announced by House commissions I and II following a visit to Irian Jaya during the recess in December of last year.

"We suggest that the government review the deal," Commission I deputy chairman Astrid Susanto said after a House plenary session to hear the joint-commission's report of its Irian visit. The session was presided over by Deputy House Speaker Soetardjo Soerjogoeritno.

Commission I is in charge of defense, security and foreign affairs, while Commission II deals with home and legal affairs.

The rich mining company, a subsidiary of American firm Freeport McMoran Copper and Gold, began operating in the early 1970s in the gold-rich province. Indonesia, then under long-time ruler Soeharto, and Freeport signed the first deal in 1967 and extended it in 1991.

Astrid said the revenue sharing stipulated in the contract was unfair since it earned Indonesia only 20 percent of the income.

"Indonesia who owns the land receives only a tiny share. Is that fair?" she said.

Astrid said the two commissions fell short of suggesting a fairer revenue sharing program.

Meanwhile, the Commission I spokesman, Hepi Bone Zulkarnain, said the commission deemed the current contract to be against the 1967 Foreign Investment Law and the Constitution.

"The exploitation of natural resources in the province should benefit the local people as stipulated in the law and Constitution chapter 33," Hapi said.

He suggested that the government seek "a win-win solution" should the contract be revoked.

The two commissions concluded in their report that the mining operations had resulted in socioeconomic injustice, rampant human rights abuse and political tension.

Demands for independence have mounted in the province over the past year. (jun)