|
Indonesia Copper
Copper mining in the late 1980s was dominated by the
FreeportMcMoRan Copper and Gold Company, a United States firm,
which,
through its joint venture subsidiary Freeport Indonesia,
had
operated the Ertsberg Mountain mine in the Jayawijaya
Mountains of
Irian Jaya Province since the early 1970s. The mined ore
was milled
and then sent 115 kilometers by pipeline to Freeport's
Amamapare
port. The mine produced 32 million tons before becoming
depleted.
To expand its operations, in 1989 Freeport Indonesia was
granted an
exploration license by the Indonesian government that
added 2.5
million hectares to its original 10,000-hectare
concession. A major
new discovery on Grasberg Mountain, three kilometers north
of the
Ertsberg Mountain site, was expected to come under
production in
1990 and to produce around 270,000 tons annually by the
end of
1992. It was projected to become the world's largest
open-cast
mine, and at one of the lowest costs in the world. Total
proven and
probable reserves of copper, centered in the Ertsberg and
Grasberg
areas of Irian Jaya, were 15 billion tons. In a related
joint
venture, Freeport Indonesia, Nippon Mining (Japan),
Metallgesselschaft (Germany), and a private Indonesian
investor had
plans to start construction of a 150,000-ton annual
production
capacity, US$600 million copper smelter in Gresik, Jawa
Timur
Province. Given its 10 percent ownership of Freeport
Indonesia, the
Indonesia government had high profits at stake.
Data as of November 1992
|
