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1) Indonesian auditors from the Audit Board of Indonesia (BPK) proposed fining Freeport Indonesia, estimating the penalty at $502 million due to delays in constructing a copper smelter in East Java. Freeport Indonesia, largely owned by Indonesian state-owned company MIND ID, faces this penalty despite claiming its construction progress aligning with the agreed targets, reaching 83% completion by November. The company committed to building the $3 billion smelter as part of an agreement in 2015 and later set a completion deadline of five years in a 2018 deal with Jakarta. Delays arose, primarily due to the COVID-19 pandemic, pushing the smelter's groundbreaking to 2021. It's slated to commence production to mid-2024 and reach full capacity by the end of the following year. BPK's audit revealed Freeport Indonesia's failure to measure smelter progress against the initial plan, prompting the recommendation for an administrative fine by the energy ministry. Freeport Indonesia's spokesperson mentioned ongoing coordination with the government concerning the delay fines, while the energy ministry hadn't immediately responded to requests for comment.
Source: UPDATE 2-State auditors recommend Freeport Indonesia be fined for smelter delays (yahoo.com)
2) Chile aims to accelerate its copper production recovery, anticipating a surge in demand due to the gloval energy transition's need for copper wiring. President Gabriel Boric's government plans to increase copper production by 1.04 million metric tons by 2026, indicating a 20% rise from 2021 levels, akin to the output of Escondida, the world's largest copper mine managed by BHP Group. Challenges like declining ore quality, water limitations and pandemic disruptions led to a drop in Chilean copper output in recent years. However, this decline compensated for a demand slowdown during inflation control efforts. With the rise in clean energy technologies, building new mines becomes more complex and costly, setting the stage for increased demand. Chile's national copper commission, Cochilco, projects a 1% rise in production to 5.4 million tons this year, followed by a 4.3% increase to 5.6 million tons next year. They've identified a project pipeline woth nearly $74 billion from 2022 to 2031, with major players like Codelco, Anglo American, Antofagasta, and BHP planning significant investments. According to BloombergNEF, Chile could potentially boost annual production by about 1.5 million tons by 2028.