Talks to Alter Freeport Pact At a Standstill, NGO Claims
Rangga Prakoso &Tito Summa Siahaan
Little progress has been made in attempts by the government to renegotiate the mining contract held by Freeport Indonesia in an effort to improve the welfare of Papuans, a nongovernmental organization claims.
A national government minister last month said the miner, which runs an enormous copper mine on Papua, had expressed a willingness to renegotiate its contract, providing a sign of progress after months of discussions.
But the Indonesian Human Rights Committee for Social Justice (IHCS), which itself is in the midst of legal action against Freeport, was skeptical that substantive progress had been made by the government.
“ ‘Contract regeneration’ was merely statements to the media. We see no realization since we filed a suit [against Freeport] in April last year,” IHCS secretary general Gunawan said on Monday.
IHCS’s suit, filed in the South Jakarta District Court, is against Freeport, the Ministry of Energy and Mineral Resources, and the House of Representatives, and alleges infringements in the royalty payments.
The activist group argued that the 1 percent royalty paid by Freeport was lower than the 3.75 percent rate for gold mining required under the 2003 government regulation on non-tax state revenue. The group demanded the miner’s contract to be revoked and Freeport pay $254 million in compensation.
“If both the government and Freeport are really serious in renegotiating the contract, we should see significant progress in the mediation [for the legal preceding], but we see none of that,” Gunawan said.
Gunawan said the trial is scheduled to conclude next Tuesday.
Last month, Hatta Rajasa, the coordinating minister for the economy, said Freeport was willing to build a smelter to comply with the government requirement to process ore minerals locally.
He also said the mining giant was willing to give up some of its land due to a reevaluation of its mining concession area and increase the participation of the local government and regional companies.
These go some way toward addressing the key demands of the government, which include compulsory divestment of a stake to local owners, trimming the size of mining concession and requiring the use of local content in operations.