REPUBLIKA.CO.ID, JAKARTA –- Deputy Chairman of Commission VII House of Representatives (DPR) Satya Wira Yudha supported government policy to transform the work contract of PT Freeport Indonesia became a special mining permit (IUPK).
Satya said, by making work contract (KK) into IUPK, Indonesia has a better position at the top of Freeport. While still in KK, he said, the state's position was similar with Freeport. But in IUPK, the state has a better bargaining opposition, and the power to revoke the license at any time required.
"Therefore we appreciate Freeport steps to change from KK PKP2B (work contract and work agreements of coal mining) into IUPK (special mining permit). It means Freeport is committed to keep investing in Indonesia with the change rule," he explained, on Thursday, June 11, in Jakarta.
"We must see that the contracts regime is different with license regime. We see that the sovereignty of nations is more visible when we release permits rather than contract," he said.
Regarding the 20-year contract extension that could also directly signed between Freeport and the government, Satya considered that it was already suitable with the law. Satya said, license renewal could be done every 10 years and could be extended to 20 years.
"So what is done by the government to Freeport on this day refers to Law of Mineral and Oil number 4 of 2009," he said.
Furthermore, Satya explained that later if there is permission from the foreign operator whom will go to Indonesia, it will be granted IUPK permit, no longer in the form of work contract.
Besides, Satya also urged the government to urge Freeport to explain the work contract until 2021 and after that the government to restore the Freeport management rights to the state. Satya considered, this idea could not be done because eventually to manage this, the state will make a tender.
"Taken by the state does not mean the state who operate it. So the state will make a tender for it. The state has the option to choose. So, the important is the Freeport contribution is real. The point is we do not want to stop the operation that will be idle and we are busy looking for the players. So, who are the losers? The nation itself," he said again.
As previously reported, the government through the Energy and Mineral Resources Ministry (ESDM) changed the Work Contract (KK) of PT Freeport Indonesia became a Special Mining Permit (IUPK).
The change of this permit gave a signal from the government to prolong the continuance of PT Freeport Indonesia business for 20 years to work on a copper mine in Papua.
Public Communication Head of Energy and Mineral Resources Ministry (ESDM) Dadan Kusdiana said granting the extension of business continuation did not violate the existing provisions.
Freeport was willing to change the working relationship from work contract into IUPK. Dadan said Government Regulation Number 77 Year 2014 on the Implementation of Mineral and Coal Mining, said the proposed contract extension works the fastest two-years or at the latest 6 months before the contract expires.
Referring to the provisions, so Freeport should apply for renewal in 2019 because of contract will be expired soon. C37
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