Shares of FCX are getting poleaxed again, down 7%, after the Indonesian gov’t told them to set aside $530 mill for a fucking smelter. Also, just the other day, the Chief of FCX Indonesia resigned. And, to boot, Freeport is trying to sell a stake to the gov’t of Indonesia for $2.7 bill.
The whole scheme screams fuckery, largess.
The Indonesians smell blood in the waters and are now demanding the cash strapped FCX deposit $530 mill, for a retarded smaller, that’s only 14% complete.
The Indonesian unit of Freeport McMoRan Inc must put a further $530 million into an escrow account, a government official said, among other requirements for the miner to extend its permit to export copper concentrate from Indonesia.
The funds are intended to be a guarantee that the Phoenix, Arizona-based company will complete a smelter in Indonesia, which is pushing to boost returns from its natural resources.
The amount would add to an estimated $80 million the U.S. mining giant set aside in July to obtain its current export permit, which is set to expire on Jan. 29.
The requirement adds to pressure on Freeport, whose stocks have tumbled 36 percent this month and hit their lowest in more than 15 years on Wednesday, hammered by falling prices for copper and oil, which the company also produces.
“This money is the remaining amount they should have spent on their smelter so far,” Coal and Minerals Director General Bambang Gatot told reporters on Friday, adding that his team had not heard back from Freeport on the requirement.
A Freeport Indonesia spokesman told Reuters the company was still in discussions with the government on the matter.
According to Gatot, the smelter project, estimated to be worth up to $2.5 billion, is now 14 percent complete.
Energy Minister Sudirman Said said on Wednesday the new smelter should be 60 percent complete by now.
“We have warned them from a long time ago,” Said said, referring to the export permit deadline.
So their export license is going to expire on 1/29, which would completely screw the company over and Indonesia knows that. So, they’re tightening the vise on their heads. I bet they’d love to just seize all of the assets and kick FCX out.
These are the risks when doing business in the land of the savage.
How valuable is their Indonesian properties? They value one of their mines there at $16.2 billion. Without Indonesia, FCX is bankrupt.
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Hello it’s us GLIB Bears in the Comment Section. If you noticed a week before Draghi talked, us Bears were a afraid of what he would say. Well, now he spoke and we are getting that lame Central Bank Rally without sense as the world falls apart. The Bulls are totally ignoring that even though he PROMISED all the cocaine they want, he still bottomline DOES NOT have the Votes for any massive addition to QE. China is about 2 weeks from shutting down for VaCa (China New Year), we know this is going to get so ugly…so OMG why does the Bulls think this is Cocaine Central Bank Party time?? Grrrrr I so hate Central Bank talk.
You and Showtime should get a room.
looks like one economic hit man forgot to wear a vest.
I guess Indonesia is going to get their 500 mil.
and then spent on “infrastructure”