Freeport mine could be shut for two months

A government official said on Saturday Freeport McMoRan Copper and Gold cannot restart production at its large copper mine until investigations conclude into the mine collapse.

The investigation is predicted to take two months, according to a company official. This is adding uncertainty to how long the company can provide the metal.

The independent investigation has commenced and the company cannot restart until this finishes, a Freeport spokeswoman said.

“The investigation team formed by the government arrived in Tembagapura yesterday morning and I hear reports from the site that they have started by going to ground zero and doing investigations there,” Freeport Indonesia Corporate Communications chief Daisy Primayanti said.

“They are indicating to us that they will be completing the investigation in two months.”

The copper and gold giant halted operations at its Grasberg operations in eastern Indonesia on May 15, a day after a training classroom collapsed, killing 28 people.

Ten injured workers were rescued from the rubble.

Another mine worker died on Saturday evening following a safety violation on Friday. This led to a union leader telling members to stop work at the second biggest copper mine in the world.

Freeport union official Virgo Solossa called for all activities to be suspended at the west Papua site and an examination of the safety systems.

“We will do all we can to help his family get through the loss of their husband and father,” Freeport Indonesia President Director Rozik B. Soetjipto said in an e-mailed statement.

The latest incident is also under investigation.

“(Freeport must) stop all production activities except for maintenance until the results of the independent investigation are completed,” Energy and Mineral Resources Ministry director of minerals Dede Suhendra told Reuters by text message.

Freeport Indonesia posted pictures of the rescue efforts on its Facebook page, including a photo of the rescue team praying before beginning its efforts.

Primayanti refused to comment on the issue of ore stockpiles and shipments. The company will find it difficult to supply its customers and suppliers with copper as the closure extends.

According to industry sources, big miners usually carry three to four weeks of ore stockpiled at port, and around three days on site.

The mine collapse could impact contract renegotiations between the Indonesian government and the company, which is trying to get an extension beyond 2021.

The company wants Grasberg to be the world’s largest underground mining complex after 2016 when its open pit ventures will end. Open-pit mining makes up two-thirds of production at present.

Open-pit mining at Grasberg yields about 140,000 metric tonnes of copper ore a day, and underground operations produce 80,000 metric tonnes.

Issues at the mine have supported copper prices but an extended shutdown would be required to impact world supplies, which is still in small surplus this year.

The company has commenced some operations at the mine, it said on Wednesday.

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.