Airlangga: Freeport Gresik Smelter Construction Becomes History for Indonesia

13 October 2021

The Coordinating Minister for Economic Affairs, Airlangga Hartarto said the construction of the PT Freeport Indonesia (PTFI) smelter in the Java Integrated Industrial and Port Estate Special Economic Zone (JIIPE) Gresik, East Java is a history for the Indonesian people. Airlangga revealed that for 40 years the profits from the production produced by the Freeport Smelter have been enjoyed abroad.

"That's what is called precious meter recovery. The investment is 200 USD, from the gold it can be 35 tons to 54 tons. So the pre-factory has been prepared there. Now, the price of gold is 700 per troy ounce. So the production is 35 tons, that's a value of 1,8 billion USD, if the production is 50 tons, it will reach 2.7 billion USD," said Airlangga during the Groundbreaking event for PT Freeport Indonesia's Smelter Development, KEK Gersik, on Tuesday, 12th October 2021.

"So imagine for 40 years that 2 billion was enjoyed by other countries on average. Whether it 70% to Spain or to Japan. So for today it becomes historic because all of this will later be produced in Gresik," said Airlangga in a press statement, on Wednesday, 13th October 2021. Airlangga explained that the Freeport Indonesia smelter in Gresik would be the largest in the world. The Freeport smelter in Gresik will process 1.7 million tons of concentrate and will produce 600 thousand copper.

"The current value of the suitcase is in a super cycle of 9,400 dollars per ton. So the investment is IDR 42 trillion or 3.5 billion USD, the revenue is only from copper, which is 5.4 billion USD (IDR 76.7 trillion). Of course this is for Freeport's holding revenue is there, but (PT Smelting) is only given (talling)," he explained.

Airlangga said that the presence of the Freeport Smelter in Gresik is also expected to be able to absorb as many as 40 thousand people. "Well, one of those who attended, of course, said that it was hoped that it could add 40 thousand workers during construction, he said. In line with Airlangga, Minister of State-Owned Enterprises (BUMN), Erick Thohir said the company whose 51% shares are controlled by BUMN will able to accommodate workers from East Java.This, said Erick, to ensure that certainty of job openings can also be created from the presence of the Freeport Smelter in Gresik.

"Earlier, the East Java Governor's entrusted the majority of her workers from East Java if possible," he said. Erick added that PT Freeport Indonesia's revenue growth will increase 100 percent this year. Previously, PT Freeport Indonesia recorded a net profit of IDR 10 trillion last year and is planned to reach IDR 40 trillion by the end of this year. "As we have seen, currently Freeport's revenue growth is compared to last year and this year it has increased by almost 100 percent. Last year it was Rp. 50 trillion, this year in December, it is planned to be Rp. 105 trillion," he said.

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