Freeport Indonesia says mine returning to normal
Conditions at Freeport-McMoRan Copper & Gold Inc.’s Grasberg mine in Indonesia are returning to normal, the company said on Monday, after thousands of workers ended a four-day strike at the weekend.
The strike had helped send copper prices to seven-month highs after the walkout slashed Freeport’s production.
Separately, a senior official at Indonesia’s mines and energy ministry said that the mine in Papua island was likely to meet its output target this year.
Tongoi Papua, a group representing native Papuan workers, reached a deal late on Saturday to double the basic monthly salary to 3.1 million rupiah ($341) from 1.5 million rupiah. Workers had initially asked for 3.6 million a month.
“The conditions have recovered, workers have returned to work as scheduled,” Mindo Pangaribuan, a spokesman for Freeport Indonesia, said by telephone.
“During the strike our production was below average, but with the situation normalising, we hope that production can return to normal,” he added, without elaborating.
The mine on the island of Papua produces more than 500,000 tonnes of copper annually and is Indonesia’s biggest source of tax revenue.
“The strike was only a few days, I don’t think it will affect Freeport production this year,” Simon Sembiring, director general of mineral resources at the mines and energy ministry ministry, told Reuters.
“Freeport can compensate production from the lost work days with other days,” he said.
Freeport has said output from the Grasberg mine is expected to be 1.1 billion pounds of copper in 2007, down slightly from 1.2 billion pounds in 2006.
The company’s gold production was expected to reach 1.8 million troy ounces this year, compared with 1.7 million in 2006.
Frans Pigome, the head of Tongoi Papua, said the new adjustment in salaries would take effect on June 1.
“The workers should be motivated because the improvement in welfare has been responded to,” he told reporters in Timika, which is about two hours drive from the mine.
As part of the deal to end the walkout, the firm also plans to set up a department to handle the welfare of native Papuan workers.
The Papuan workers had demanded more career opportunities for native workers, improved recruiting and better pensions. The protest coincided with talks over a new two-year collective labour agreement for Grasberg’s 9,000 direct employees.
Arizona-based Freeport had said on Saturday that mining and milling had been hit, but said stocks were being used for shipping.
Information from: asia.news.yahoo.com