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«Newmont» and «Freeport» will be engaged in joint construction in Indonesia

Subsidiaries structural divisions of major international steel corporations, the company «Newmont Nusa Tenggara» and «Freeport Indonesia», have committed themselves to respect to construction in Indonesia smelters. Rozik Soetdzhipto, president of the company «Freeport Indonesia», provided the publication «Jakarta Globe» details about what the purpose of organizing the construction of a plant for the smelting of copper planned merger with state-owned company «Aneka Tambang». Guarantees provided by «Newmont Nusa Tenggara» and «Freeport Indonesia», will be confirmed by a deposit in an Indonesian bank «Bank Mandiri» a total of 141 million. USD.

Start of construction is planned for the second half of the year, expenditure is estimated at 2.3 bln. USD, while production volumes according to preliminary calculations, amount to 400 thousand tons per year. Special benefits for companies «Newmont Nusa Tenggara» and «Freeport Indonesia» at the beginning of the operation of enterprises in 2017 — the lack of export duties. In that case, if the construction is not completed by the agreed deadline, the export traffic for companies increases and contributed to the bank deposit forfeited. In addition to the financial investments «Newmont» plans to deliver its own copper concentrate. According Hyrule Tanjung, who is the Coordinating Minister for Economic Affairs of the country, at the moment the total quota for the companies «Newmont Nusa Tenggara» and «Freeport Indonesia» for duty-free export of 850 thousand tons of copper concentrate, which is estimated at 1.5 billion USD. However, an export permit will be granted to companies only on the fact of making deposit funds.

Despite a certain degree of risk, this project is quite attractive for companies, especially if to look at the consequences of the Indonesian ban, signed Sisilo Bambang Yudhoyono, President of the country, in January last year. Under this law a ban on exports of bauxite and of unprocessed copper and nickel ores. The decision dealt a severe blow to the global economy because Indonesia prior to the ban ranked first in the world in exports of nickel ores and is the largest exporter of bauxite, copper, iron ore, gold and other metals. The government expects as a result of the ban on exports of goods falling in the mining industry in the current year up to 7 bln. USD, while the performance of last year were between 11 and 12 billion. USD per annum.

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