The closure of Freeport's operations post-accident, is causing loss to Indonesia. Losses suffered by the country quite a lot, because the company did not give royalties to the state. Closure of the Freeport operation is caused by an accident that occurred in Freeport on 27 September 2014 ago. The severe crash, making 4 workers died and five others critically. Ore mining activities in the Grasberg is stopped until Freeport obeys the previous government recommendations.
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| image source: aktualpost.com |
Recommendations priority that must be done by Freeport is hazard identification, assessment and control of risks in all areas of Grasberg. Freeport also asked to improve traffic management in all areas of the mine. Recommendations should be implemented within a week maximum. For now on, Freeport Exploration activities have been halted temporarily, but for maintenance activities remain to be done, such as making sure water lines around the cliff mine.
As stated by the Director of the Directorate General of Minerals, Energy and Mineral Resources Ministry, Edi Prasodjo, if Freeport stop for two weeks, then the loss of Freeport exports reached 75,000 tons of concentrate. Hence, if it does not export so the company did not pay royalties to the state. In other words, the income of Indonesia will certain be reduced.
He explained, in the production of Freeport about 75,000 tons of concentrate, when multiplied by the royalty of gold so the royalty value will be very large. If calculated, a half months of production loss of 75,000 tons of concentrate and gold royalty multiplied by 3.75 percent, just from the gold royalty. While, certainty value of the potential loss of royalty is still in the stage of the calculation.
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