Freeport Claims Smelter is Not Profitable
Freeport claims the added value of processing concentrate into pure copper is only 5%. PT Freeport Indonesia (PTFI) again revealed that the copper smelter project currently under construction is a project that is financially detrimental.
PTFI President Director Tony Wenas said the mining process starts from ore which is then processed into copper concentrate. The added value from processing ore to concentrate reaches 95%. Meanwhile, the processing from concentrate to the copper cathode which is done in the smelter has a mini added value, only 5%.
"Yes, it is a loss, if the project is a loss I say profit is misleading," said Tony.
Later, the Freeport smelter will receive revenue from the Treatment Charge and Refining Charge (TCRC). Currently, the TCRC price, which is almost valid around the world, is around the US $ 20 cents - the US $ 24 cents per ton of copper, which value has not changed in the last 20 years.
However, in early March when the Covid-19 pandemic broke out, the price fell to the level of US $ 18 cents per ton. In fact, with the copper smelter project that requires an investment of US $ 3 billion, Tony calculated, the economically sound TCRC value must reach the level of US $ 60 cents per ton.
"Meanwhile, if we smelt in other places, the only US $ 20 cents is sufficient. so there will be a difference of US $ 40 cents which must be borne by PTFI, "he said.
if calculated, the difference could reach the US $ 300 million per year. Calculating the period of PTFI's permit for the next 20 years, the cumulative difference will be around the US $ 6 billion.
"Coupled with the construction of US $ 3 billion, approximately US $ 10 billion," he said.
Apart from this problem, there is no certainty in the domestic market for smelter products.
Kontan, Page-10, Saturday, Sept 5, 2020
0 Response to "Freeport Claims Smelter is Not Profitable"
Post a Comment