UPDATE 4-Indonesia offers tax cut to miners, Freeport to soon resume exports

Thu Jul 24, 2014 9:44am EDT
 
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* Miners must pay bond or build smelter to get lower tax

* Concentrate export tax cut to below 10 pct from 20-25 pct

* Freeport set to strike deal

* Newmont still in dispute (Recasts, updates details on export tax revision)

By Fergus Jensen

JAKARTA, July 24 (Reuters) - Indonesia has offered mining companies a tax concession to end a six-month dispute that has reduced mineral exports by half a billion dollars a month, pushed up the global price of some metals and led to thousands of layoffs.

The company with the biggest mining operations in the archipelago, Freeport-McMoRan Copper & Gold Inc, is set to become the first to take the deal and restart concentrate shipments from Grasberg, one of the world's largest copper mines. Freeport said on Wednesday that the signing of a memorandum of understanding (MOU) to resume exports was imminent.

After a cabinet meeting on mining policy on Thursday, Indonesia's chief economics minister Chairul Tanjung told reporters that Freeport was close to receiving an export permit.

If other miners follow suit, the deal will take some of the pressure off president elect Joko Widodo. Widodo was declared the winner of Indonesia's presidential elections this week and has said solving the dispute - which has sapped government mining revenues - would be one of his top priorities when he takes power in October.   Continued...