Rising Tensions in Grasberg; Mine workers planning one-month strike in May

Grasberg Mine, Indonesia

Tensions are increasing around Grasberg, the world’s second-biggest copper mine. It is happening because operator Freeport laid off thousands of workers. In order to retain losses from an underway argument with the Indonesian government, over mining rights.

Firstly, copper miner Freeport-McMoRan Inc. warned it will punish workers for absenteeism at its Indonesian unit. Secondly, yesterday, one of its main unions announced plans to go on a one-month strike. Following, they are not satisfied with the employment conditions.

A strike could impact Freeport efforts to ramp up production. Company is expecting to soon affix agreements with Jakarta to allow it to temporarily resume copper concentrate exports.

“Workers were very absent over the last several days.” “We are tracking absenteeism, and disciplinary actions will be enforced. Under the terms of the Collective Labor Agreement.”

Cutting the workforce

Last week Freeport has discharged over 10 percent of its workforce of 32,000. This number will grow until its dispute with the government comes fully resolved.

Further adding to tensions around Grasberg, clash injured several Freeport workers and police officers in Papua on Thursday, when officers fired rubber bullets at demonstrators.

“Company is giving efforts to reduce its workforce. It has extensive impacts on workers and their families”. The workers union spoke about this, stating it is not a solution.

Workers are worrying about the discharges. “Because there are no limits or specific criteria on workers who will be furloughed.” They requested an end to the furlough policy. And informed Freeport of their plans to strike for 30 days. Beginning from May the 1st.

‘Shaken & Confused Workers’

“Efforts by the company to cut costs and reduce numbers of workers, made a fiasco among them.” It led to agitated tensions and their determination to protest.

One worker added that in his view Freeport was only doing what it needed to survive. And that cutting costs is one of the strategies to turn around company’s conditions. He said there are many workers who would not join the strike.

Thursday some workers “were carrying out acts of anarchy … so police took action and fired rubber bullets on them.” Solossa said the clash injured four workers and seven police officers. But that the controvert was not related to the planned strike.

The incident

Timika Police Chief confirmed the details of the incident. He added that incident included roughly 1,000 demonstrators. Also when the tear gas was fired there were many of them present.

New rules demanded the Arizona-based company to adopt a special license. Affected by that Indonesia blocked Freeport’s copper concentrate exports in January. It payed new taxes and royalties. Divested a 51 percent stake in its operations, and relinquished arbitration rights. This stoppage made hundreds of millions of dollars cost. As for the company, also for Indonesia. But negotiations over sticking points will continue for the next six months at least.

“We have the right to commence arbitration in 120 days if no agreement is reached.” (Freeport saying to Jakarta)

In the end, it is all up to workers now. They will decide their own destiny. But the fact that many of them are discharged from their workplaces is scary. There are families behind who depend on these wages. And there is also cruel fact of a cold economy. The costs must be cut, if the company plans to get over the wounds and bloom. Grasberg is going to be very agitated in the next few months. We will see the outcome.