Indonesia has granted Freeport Indonesia a six-month copper export permit to support its operations while repairs are conducted on its damaged smelter. This decision aims to maintain government royalty payments and assist Freeport in recovering from the disruption caused by a recent fire, according to several media reports.

On March 17, 2025, Energy Minister Bahlil Lahadalia announced the permit extension, emphasizing the government's commitment to ensuring ongoing revenue from the mining company during this period. "We are giving six months so they can promptly repair the smelter and ensure Indonesia receives state revenues from royalties," Lahadalia stated.

Freeport Indonesia had been unable to export copper concentrate since its previous permit expired at the end of 2024. The company also had to suspend copper cathode production at its Gresik smelter complex in East Java following the fire incident last October. Currently, Freeport's operations are functioning at only 40% capacity, resulting in a considerable stockpile of approximately 400,000 metric tons of copper concentrate.

Last week, Freeport confirmed its request to export up to 1.2 million tons of copper concentrate to address growing inventory concerns. The new export permit offers relief by enabling Freeport to manage its copper concentrate backlog more effectively.

This export permit holds particular significance in light of Indonesia's strict regulations on mineral exports. As part of its strategy to promote domestic processing industries, Indonesia has enforced stringent policies that prohibit the export of unprocessed minerals like copper and nickel.

During the announcement, Minister Lahadalia also highlighted a notable achievement for Freeport. He attended the launch of Freeport Indonesia's precious metals refinery, located within the Gresik smelter complex. This $630 million facility has the capability to process not only copper but also valuable metals such as gold, silver, platinum, and palladium. The establishment of this refinery aligns with Indonesia's broader efforts to expand its domestic processing industry, ensuring that more economic value is retained within the country.

This development is expected to generate additional economic activity and create much-needed employment opportunities as the global economy continues to evolve. The temporary export permit provides Freeport with an opportunity to alleviate some of the operational challenges it has faced and maximize its royalty contributions to the Indonesian government.

Details regarding the exact export quotas permitted are yet to be clarified. Nonetheless, the permit reflects Indonesia's attempt to strike a balance between supporting industrial demands and enforcing resource management policies. The government's approach underscores its commitment to long-term economic stability and sustainable growth through responsible management of its abundant mineral resources.

Freeport's ability to expedite smelter repairs and fulfill export quotas will be crucial to its future operational stability and Indonesia's economic resilience.