PT Freeport Indonesia (PTFI) has officially launched operations at its state-of-the-art copper smelter located in the Java Integrated Industrial and Ports Estate (KEK JIIPE), Gresik, East Java. This facility, which began construction in October 2021, represents a pivotal moment in Indonesia's mining sector. Designed as the largest single-line copper smelter globally, it can process 1.7 million tons of copper concentrate annually, yielding approximately 600,000–700,000 tons of copper cathodes.

In a ceremony on September 23, 2024, President Joko Widodo highlighted the strategic importance of the smelter. "This project showcases Indonesia’s commitment to transitioning from raw material exports to domestic processing," he stated, emphasizing its role in advancing the nation's industrial capabilities. The facility spans 104 hectares and forms part of the government’s broader effort to foster economic transformation through downstream industrialization.

The smelter is expected to contribute significantly to Indonesia's economy. Annual state revenue from PT Freeport Indonesia could exceed IDR 80 trillion derived from dividends, royalties, and various taxes. Since 1992, Freeport's operations have injected over USD 71 billion into the national GDP, with direct financial contributions amounting to USD 29.3 billion.

Beyond financial benefits, the smelter creates substantial employment opportunities, with Freeport being Papua’s largest private employer. Over 208,000 jobs have been generated, underscoring its role in economic empowerment. Furthermore, Freeport has secured long-term buyers for its copper cathodes, including PT Hailiang Group, which will absorb 100,000 tons annually.

While the facility faced delays due to a gas unit fire in October 2024, its full operations are slated for mid-2025. The total investment for the project reached USD 3.67 billion, aligning with Indonesia’s mining downstreaming initiatives aimed at maximizing domestic resource utilization.

CNBCINDONESIA