Freeport-McMoran Copper & Gold Inc. (FCX) said production from its Grasberg mine in Indonesia’s Papua province was disrupted after workers started a seven-day strike yesterday, demanding wage increases.
The mine is operating at a “smaller scale,” although concentrate shipments are unaffected by the stoppage, Ramdani Sirait, a Jakarta-based spokesman at unit PT Freeport Indonesia, said today in a mobile-phone text message. The company will use its stockpiles to meet contractual sales, he said yesterday.
“Worker representatives and Freeport officials met this morning to discuss the contracts for 2011 to 2013,” Virgo Solossa, head of organizational affairs at Freeport Indonesia’s labor union, said by telephone from Timika, Papua. “We want Freeport as a world-class mining company to give us better conditions.”
Almost all of the 8,000 non-staff workers have gathered at the town about 46 miles (74 kilometers) from the mine site since 3 a.m. local time, Solossa said. The workers are paid $1.5 to $3.5 an hour or about 3 million rupiah ($351) to 5.5 million rupiah a month, he said.
Grasberg, where operations started in 1990, contains the world’s largest recoverable reserves of copper and the biggest single gold reserve, according to Freeport’s website.
Copper production at the Grasberg mine fell to 1.22 billion pounds (553.4 million kilograms) last year from 1.41 billion pounds a year earlier, according to the website. Gold output declined to 1.79 million ounces (50,745 kilograms) from 2.57 million ounces.
Copper for three month delivery slipped 0.3 percent to $9,430 a ton on the London Metal Exchange at 11:53 a.m. Jakarta time. The contract has dropped 2.6 percent this year.
To contact the reporters on this story: Bambang Djanuarto in Jakarta at bdjanuarto@bloomberg.net; Yoga Rusmana in Jakarta at yrusmana@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
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