Sabotage, deadly clashes shut down Grasberg
China’s state news agency reports all production at Freeport McMoran’s Grasberg mine in a remote province of Indonesia has been halted after a pipeline was sabotaged, access to the pit and underground operations were blocked and three miners were killed in an ambush.
The latest attack follows an incident last week when Indonesian security forces fired on striking workers after a protest turned violent, killing one and injuring a dozen other, including seven police, some of them critically. The local police chief said between 500 – 600 policemen are now billeted at the mine.
Some 12,000 Workers at Grasberg began a strike on 15 September and earlier this month vowed to shut down the mine if hourly wages of $1.50 is not upped 8-fold.
Xinhua reports “As of today we had to stop all production process,” Freeport Vice President Nurhadi Sabirin said in a teleconference with the media held here.
Sabirin said that the pipeline transferring gold and copper ores from its mill to the seaport cannot operate properly following the shootings and sabotage. The pipeline stretches 114 km from Freeport’s mill center on Grassberg hill in Tembagapura, Papua to the seaport.
As of Oct. 15, Freeport has shipped 103,189 tons of gold and copper concentrate from its seaport in Papua.
Al-Jazeera has in-depth coverage on Grasberg: Freeport began to disclose security-related payments in filings with the US Securities and Exchange Commission in 2001. It confirmed annual payments reaching an average $5m each year for government-provided security of the Grasberg complex and its staff and fluctuating annual costs reaching $12m for unarmed, in-house security costs. A spokesman for the company later told the Jakarta Post that these payments had been taking place since the 1970s.
Reuters reports Freeport-McMoRan Copper & Gold Inc (NYSE:FCX) is the largest taxpayer in Indonesia and in the first week of the strike last month when production was slashed by 230,000 tonnes a day, it represented daily losses of $6.7 million in government revenue. Freeport, the world’s largest publicly traded copper miner, is also facing labour action at its Corro Verde mine in Peru.
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9 Comments
Jonas_Barbarossa
$1.50 an hour? Is this slave labor?
FoodProcessorVillain
Freeport damn you poster child of corporate social irresponsibility! Your actions make the entire mining industry look bad.
The Mafia Man
I have @ 75 off road haul trucks at a oil sands in north america, I wish that I could get $1.50 an hour drivers…. “HELL” No I DON”T” This is just what gives our industry a bad name! Hang in there guys, keep em shut down!…..
Xyzmining
The Freeport Management “must be wearing their heads up their xxxxxs” to allow this situation at Grasberg to develop. Not only are they losing something like $30 million in gross metal sales each day, but after all of this trouble, they will surely lose their “flagship” Grasberg mine. The Islamic republic of Indonesia will now have en excuse to confiscate when all this is over. It would be far more economically sensible for Freeport to pay an extra few thousand $ per day by raising the pay from $1.50 per hour to $12 per hour, which would allow Freeport to continue operations and maintain their sales of $30 million in metals per day. The first law of business economics is to “maximize profits and minimize losses.” Apparently the management and board of Freeport need to return to University and retake Economics 101.
Guest
Can we get Freeport’s side of the story about why they won’t increase the workers’ pay rate? Hello? Calling Freeport’s management… Anybody home??
Baker_Fred_o
I guess nobody remembers Bougainville? Pity,,,,,,
Mario Faz
I’m not from the left side of the political spectrum but paying $1.50 an hour is exploiting the labor force there its too much. I’ll bet the Indonesian governments gets a share in taxes but those corrupt governments always get their under the table bribes to keep their mouth shut an repress the laborers. The fact of the matter is that in a developed world laborers get $20 or more an hour but there is always inflation. in Indonesia happens the same thing specially when you work and live in a remote area where the transportation is controlled by a few whose prices are abusive for the goods and food stuff. That’s the reason for the uprising. in one word: greed moves those big companies. They have the excuse of their investment but the non renewable resources are the property of the nation and as a whole they should be considered as a property of the nation, the foreign investor is an alien taking advantage of a resource it’s not theirs At least they should have respect for the country they are in and their people. Those greedy companies are the cause that left extremist exists and they indeed provoke the anger that erupts in violence. Am I wrong or what?
Mario Faz
As a whole we all agree. That’s fine.
Abdulrahman
negoatiation is to be given first priority