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Papua urges US miner to pay $376M in taxes, penalties

Posted January 27, 2017 6:00 am

The Associated Press

JAKARTA, Indonesia (AP) - The governor of Indonesia's easternmost province of Papua is urging Freeport to immediately pay $376 million in taxes and penalties after a court ruled against the U.S. mining giant in a water use case.

Lukas Enembe said Friday that the Tax Court ruled Jan. 17 that Freeport should pay much higher taxes on water the company drew from two Papua rivers between January 2011 and July 2015 to suspend tailings from its mining operations.

The Grasberg mine operated by Freeport is the world's largest gold mine by reserves and one of the biggest copper mines.

Under Indonesian law, payment is required about 30 days after receipt of the ruling. Freeport Indonesia, a unit of Phoenix, Arizona-based Freeport-McMoRan Copper & Gold Inc., is expected to appeal to the Supreme Court.

Enembe said the province was claiming taxes based on a 2011 local government decree. Freeport had argued it should pay a lower rate based on a decades old contract with Indonesia's government.

Papua Governor Lukas Enembe gestures during a press conference in Jakarta, Indonesia, Friday, Jan. 27, 2017. Enembe says they have won a lawsuit in a claim against the local unit of a giant U.S. owned gold and copper mine for $376 million related to surface water taxes. (AP Photo/Tatan Syuflana) The Associated Press

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