West Papua indigenous independence leaders today launched  “Green State Vision” at the COP26 climate summit in Glasgow, pledging to take decisive action to address the climate emergency and the impact of natural resource extraction in an independent West Papua.

The Green State Vision was drafted with the assistance of international lawyers, including UK-based barrister Jennifer Robinson of Doughty Street Chambers, reports the United Liberation Movement for West Papua (ULMWP).

It sets out commitments from West Papua’s “government-in-waiting”, including:

• Making ecocide a serious criminal offence;
• Restoring guardianship of natural resources to indigenous authorities, combining Western democratic norms with local Papuan systems; and
• ‘Serving notice’ on all extraction companies, including oil, gas, mining, logging and palm oil, requiring them to adhere to international environmental standards or cease operations.

In June 2021, a panel of international legal experts, co-chaired by Professor Philippe Sands QC, drafted a definition of ecocide intended for adoption by the International Criminal Court (ICC).

West Papua is half of the island of New Guinea, home to the world’s third largest rainforest after the Amazon and the Congo. West Papua is rich in natural resources, including one of the world’s largest gold and copper mines — the Freeport Indonesia mine at Grasberg —  and extensive sources of natural gas, minerals, timber and palm oil.

West Papua was a Dutch colony until 1961. The Indonesian military seized control in 1963.

The people indigenous to the provinces are Melanesian, ethnically distinct from the people of Indonesia. West Papua continues to be unlawfully occupied by Indonesia. Indonesia is currently the world’s largest exporter of palm oil.

West Papuans have contested Indonesia’s occupation for more than half a century, with Indonesian forces repeatedly accused of human rights violations and violent suppression of the independence movement.

According to recent reports, thousands of Indonesian soldiers have been deployed to West Papua in a crackdown, with civilians forced to flee and journalists and activists targeted.

In 2020, the ULMWP announced the formation of its Temporary Constitution and Provisional Government, with exiled leader Benny Wenda as interim president.

He will be a keynote speaker at the COP26 Coalition’s Global Day for Climate Justice rally tomorrow.

A “March Against Climate Colonialism” will be held on Sunday, November 7, starting at 1:30pm at 83 Argyle Street, Glasgow.

Benny Wenda, interim president of the ULMWP and provisional government, said: ‘We are fighting for stewardship of one of the planet’s largest rainforests, a lung of the world.

“The international climate movement and all governments serious about stopping climate change must help end Indonesia’s genocide of the first defenders in West Papua. If you want to save the world, you must save West Papua.”

Joe Corré, founder of Agent Provocateur, said: “This is a critical step towards protecting one of the world’s largest rainforests from catastrophic destruction caused by the illegal Indonesian occupation.

“The Indonesian government and military, supported by BP, are using violence, intimidation and murder to silence the indigenous inhabitants.”

Jennifer Robinson of Doughty Street Chambers said: “The unlawful occupation of West Papua by Indonesia is facilitating the destruction of one of the world’s most important rainforests.

“Ensuring West Papua’s right to self-determination will also ensure the protection of the environment and the climate by allowing the Indigenous custodians of the land to take back control, protection and management of their resources.’

Article by AsiaPacificReport.nz

President Joko “Jokowi” Widodo has laid the foundation stone for a giant smelter belonging to copper and gold mining firm Freeport Indonesia in the East Java town of Gresik.

The smelter is built on 103-hectare land at the Manyar Special Economic Zone at a cost of US$3 billion, according to government data.

Jokowi said the smelter would be able to extract 1.7 tonnes of copper from ores and 6000 tonnes of gold annually.

“The single-line smelter we are going to build will be the biggest in the world because it has a capacity of extracting 1.7 tonnes of copper a year,” the president said in a ceremony to mark the start of the construction.

Freeport Indonesia operates the giant copper and gold mine at Grasberg in Papua.

He added Indonesia had the seventh biggest copper reserves in the world after Chile, Australia, Peru, Russia, Mexico, and the United States.

“Only a few of us have knowledge about this,” he said.

Lack of processing facilities
Jokowi said that despite having mines and mineral reserves, Indonesia could not reap the fullest benefit in the metal industry due to a lack of processing facilities, in comparison to countries like Japan and Spain which have higher value-added components in their manufacturing process.

“That’s why we built the Freeport smelter here in Gresik,” the president said.

The Indonesian government has a 51 percent stake in the local unit of US mining giant Freeport McMoRan.

The construction stage alone is expected to create 40,000 jobs for locals, Jokowi said.

State-Owned Enterprises Minister Erick Thohir said Freeport Indonesia had been performing well since the government secured a commanding stake on December 21, 2018.

Freeport’s revenues were estimated to more than double from Rp 50 trillion last year, Thohir said.

Soaring global copper prices and increased output in Indonesia would add to the pace of the company’s growth, he added.

“The company booked a net profit of approximately Rp 10 trillion last year and we expect the figures to reach Rp 40 trillion by the end of this year,” Thohir said.

Article by AsiaPacificReport.nz

Four Indonesian ministers gathered to witness the signing of an agreement between state-owned mining holding group PT Indonesia Asahan Aluminium (Inalum) and Freeport-McMoran (FCX) to take over Papua’s PT Freeport Indonesia (PTFI) in complex deals worth $3.85 billion.

Under the agreement, Indonesia will take control of 51 percent of Freeport Indonesia’s equity, and hold a majority stake in the company that operates the world’s largest gold mine, Grasberg in Papua.

The signing was the culmination of years of negotiations, preceding the current administration of President Joko “Jokowi” Widodo, and a tug-of-war between Indonesia and the American company.

The presence of four ministers at the signing was an indication of the economic and political importance of the deal to the Jokowi administration. But it is not yet a done deal, as officials have liked to claim.

The agreement requires the two parties to conduct further negotiations to finalise the details of the divestment. The government expects to finish ironing out the details sometime in August.

Freeport’s footprint in Indonesia
Here is your guide to understanding the seemingly never-ending negotiations, and why it matters for Indonesia to cement the deal as soon as possible:

• Freeport-McMoran has operated in Indonesia since it signed its first contract in 1967 in a deal that was good for 30 years. In 1997, it received an extension for its operation until 2021. The two contracts in essence covered mining for copper, with gold and silver treated as associated resources found alongside copper ores.
• Both contracts were signed during the regime of president Suharto. The first contract in 1967 was widely hailed as a landmark moment, symbolising the ushering in of Indonesia’s open-door policy to foreign investment under the pro-Western General Suharto, who had just taken over power from the socialist-leaning Sukarno a year earlier.
• Developing the mines deep in the mountainous jungles of Papua required huge initial investment to build core infrastructure, including roads, housing and power plants, as well as preparing the pool of workers. In return for this investment, Freeport received generous tax breaks.

Freeport’s first phase of operations exploited the Ertsberg Mountain in Mimika regency. Once the mountain was flattened, Freeport turned to mining the adjacent Mt Grasberg, which turned out to contain even larger reserves. Freeport is looking to mine the large gold reserves underground, assuming the latest agreement holds.

Bloomberg Intelligence estimates that the reserves at the world’s biggest gold deposit and second-largest copper mine are worth about $14 billion.

Freeport-MacMoran’s operations in Indonesia accounted for 47 percent of its operating income in 2017, according to Bloomberg.

Freeport’s huge profits have been a source of contention with long-standing criticism that the tax and royalty revenues paid to the Indonesian government represent only a pittance of its true income.

Indonesia’s 9.36 percent stake in PTFI, as stipulated in the 1991 contract of work (CoW), also does not amount to much, particularly as Freeport has at times withheld paying dividends.

For example, PTFI paid Rp 1.4 trillion in dividends in 2017 after three years of failing to make any payments, according to the Finance Ministry.

Freeport has also attracted controversy for the environmental and social impacts of its operations in the heart of Papua.

Last year, the Supreme Audit Agency (BPK) came out with a damning report claiming that Freeport had caused $13 billion in environmental damages.

Wind of change for Freeport
In 2009, Indonesia passed the Coal and Mineral Mining Law, or Law No. 4/2009. The law requires all foreign mining companies to divest 51 percent of their shares to the Indonesian government, state-owned or regional-owned enterprises or private Indonesian companies within 10 years of the start of operation.

Freeport has managed to work its way around the regulation by indicating that it is operating under a CoW, which is good until 2021.

In January 2017, the government issued a new regulation requiring all mining contracting companies to switch to special mining permits (IUPK) in order to export products in the form of concentrates, which is one step above ore but still not refined.

Freeport refused to fully comply, arguing that the IUPK was not a nailed-down scheme because the stipulations, including the taxation scheme, could change according to changes in government regulations.

In February 2017, the Energy and Mineral Resources Ministry issued PTFI an IUPK saying the company had finally agreed to the terms, paving the way for the divestment deal signed on Thursday.

Series of agreements
In August 2017, following pressure from the government to divest its shares in PTFI, Freeport-McMoran’s top management agreed to increase Indonesia’s share in PTFI to 51 percent, as well as to develop a smelter and increase Indonesia’s revenue from PTFI’s tax and royalty payments.

The Indonesian government chose state mining holding company Inalum to become the majority shareholder in PTFI.

However, questions remain regarding the price tag and how Inalum will pay for its stake in Freeport. Inalum president director Budi Gunadi Sadikin said on Thursday that the company would have to pay $3.85 billion in August and that it had already secured loans from 11 banks.

What are the benefits of majority ownership in Freeport?

Bisman Bakhtiar, the executive director of the Center for Energy and Mining Law (Pushep), said it was time for Indonesia to take control over the huge gold reserves in Papua, as 50 years had passed since PTFI began operations.

“Too much of our resources have been exploited. Surely after 50 years, we have the capability to operate it ourselves,” Bisman said.

Indonesia will reap the largest share of the profits and dividends, which in the past had almost entirely gone to PTFI. The government will also continue to enjoy taxes, royalties as well as a cut of the revenue.

“There are many ways to maximise the benefits from PTFI for the people, and divestment is one of them,” he said.

However, Bisman urged the government to ensure that Indonesia benefited from the next phase of negotiations to finalise the divestment deal.

“Even though we will finally become the majority owner in August, we need to look at the tax, royalty and revenue sharing arrangements. Are they better or not?”

Stefanno Reinard Sulaiman is a journalist with The Jakarta Post.

Article by AsiaPacificReport.nz