Nine banks to provide US$2.8 billion loan for Freeport smelter development

21 February 2020 11:08

JAKARTA - At least nine banks have committed to providing PT Freeport Indonesia with a US$2.8 billion loan for the development of a smelter in the Java Integrated Industrial and Port Estate (JIIPE) in Gresik, East Java.

The smelter, which is targeted for operation in the fourth quarter of 2023, requires an investment of around US$2.8 billion.

According to Freeport Indonesia CEO Tony Wenas, the company is currently in talks to obtain a bank loan. Currently, he said, nine overseas banks have committed to providing a US$2.8 billion loan.

However, Mr Wenas still declined to disclose the details of the loan scheme. He asserted that the loan refinancing will not burden Freeport Indonesia’s shareholders, including state-owned mining holding company MIND ID, which owns a 51.23% stake in the company.

In a general hearing with the House of Representatives’ Commission VII on Wednesday (19/2), Mr Wenas said that currently the project can be financed using the company’s internal cash. However, the fund requirement will increase after the project’s physical construction, scheduled in August this year, commences. This year Freeport Indonesia will invest around US$600 million for the project. (MS)

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