RNZI Posted at 03:18 on 26 February, 2008 UTC

A separatist leader from the Indonesian province of Papua says the British energy giant, BP, should not open a gas plant in the region this year.

The London-based Kotega Tribal Chairman, Benny Wenda, says he doesn’t recognise BP’s deal with the Indonesian government.

Hundreds of homes in the Bintumi Bay area have been relocated for the Tangguh project and specially trained local police are set to patrol the site.

But Mr Wenda says the development will not be sustainable.

“West Papua is the earth and forest, and sea, and this is all, you know, what we call our supermarket and our mother. So now BP will operate in West Papua, this is another genocide toward earth and animal, wildlife and all the species. This is not Indonesia’s land. This is land of West Papuan people; they have to deal with West Papuans.”

Benny Wenda. BP hopes to pump the first liquified natural gas from Tangguh in October.

latts Commodity News
February 26, 2008

Indonesia is hopeful it will be able to revise higher its price for Tangguh LNG supplies to South Korean buyers K-Power and Posco after the two companies expressed a willingness to
renegotiate the original contract at a recent meeting, a senior official at upstream regulator BP Migas said Monday.

"We want to improve our LNG contract with the South Korean buyers, like we did with [China's] CNOOC. The current oil price ceiling for the South Koreans is the same as it was for CNOOC at $25/barrel. We want to increase that to as high as possible," Kardaya Warnika, BP Migas' chairman, said.

BP and CNOOC had agreed in 2006 to amend the sale and purchase agreement for supply of Tangguh LNG into China's Fujian province. CNOOC agreed to raise the LNG purchase price to around
$3.4-3.5/MMBtu from $2.6/MMBtu on an FOB basis with the crude price ceiling in the formula increased to $38/b from the $25/b set in the original contract signed in 2002. BP and CNOOC have also agreed to review the LNG price every four years if the price of oil rises significantly.

The Tangguh LNG project being developed by a BP-led consortium in West Papua's Bintuni Bay is based on 14.4 Tcf of proven gas reserves in three neighboring production sharing contracts: Berau, Muturi and Wiriagar.

It is setting up an LNG plant with an initial liquefaction capacity of 7.6 million mt/year over two trains. The total estimated development cost is $5 billion.

BP has said it expects to start processing LNG at the end of 2008. A senior Indonesian official recently said that the first LNG shipment was expected in March 2009.

The project has agreements to supply 2.6 million mt/year of LNG to CNOOC Limited, 550,000 mt/year to South Korea's Posco and 600,000 mt/year to K-Power. It has a preliminary deal to supply 120,000 mt/year to Japan's Tohoku and has also committed to sell to US' Sempra Energy 3.6 million mt/year for marketing in North America.

The equity distribution in the Tangguh LNG project is as follows: BP (37.16%), MI Berau (16.30%), Nippon Oil Exploration (12.23%), KG Berau/KG Wiriagar (10%), LNG Japan Corp. (7.35%)
and Talisman (3.06%). --Anita Nugraha, newsdesk@platts.com

By Steve James

NEW YORK, Feb 24 (Reuters) - Freeport-McMoRan Copper & Gold Chief Executive Richard Adkerson says he has built the world's
largest publicly traded copper company without bluffing or nickel-and-diming.

"I don't have a poker face," he told Reuters in an interview when asked about deal-making in the hot metals sector. "People
can sit in a room and know how I feel about things." 

His straightforward approach and strong work ethic -- the byproducts of growing up in small-town America -- are the main
reasons Adkerson, 61, sits in the corner office at Freeport-McMoRan after pulling off a stunning $26 billion
acquisition of larger U.S. rival Phelps Dodge last year.

That deal immediately gave the company a portfolio of mines in Nevada, Peru, Australia, New Zealand and Africa to position
alongside their crown jewel -- the vast Grasberg mine in Indonesia.

It also served as a prelude to the major consolidation trend in mining that continues this year on record prices for gold,
copper and other metals. BHP Billiton threatens to eclipse the size of the Freeport-Phelps deal with an offer to buy Rio Tinto
for $147.4 billion. And Vale is weighing an offer for Xstrata which could more than triple the value of the Phelps deal.

Since the Phelps deal closed in March of 2007, bullish markets for Freeport's copper, gold and other mining byproducts sparked
a 77 percent increase in its stock price to $99 a share -- a  huge jump from the $17 value on the stock five years ago. It's a
track record his peers applaud.

"I have a lot of admiration for how he runs his business and how he's created value over the years," said Tom Albanese, Chief
Executive of Rio Tinto, who has worked with Adkerson since the two companies formed a joint venture in 1995.

"He is a very effective businessman, and the results certainly demonstrate that," Albanese told Reuters.

RECORD PRICES FUEL DEALS

The takeover thrust in mining is driven by commodity supply shortages, which have mixed with strong demand to push prices to
record highs. Adkerson, who began his career as an accountant with Arthur Andersen & Co, said these dynamics make
consolidation "inevitable."

"You have a situation where companies have generated so much cash through high commodity prices, and investment opportunities
are limited," he said in a measured Southern drawl, adding that a CEO with a merger mentality is a necessity.

"The days of having a manager who is totally technically oriented, who's not versed in the financial marketplace ... I
don't think you can be that way."

The key to success at the negotiating table, Adkerson noted, is not allowing the smaller details to detract from sealing the
deal. It's a lesson he learned from James "Jim-Bob" Moffett, Freeport's chairman, whom he has known for years.

"When you decide to do a deal, the most important thing is to get the deal done, not necessarily to trade for the best deal
that is there," he said. "You want to get the best terms you can, but too often people let deals get away from them."

Winning the trust of the other side is key, Adkerson said. "I've found that if you're up-front with people and honest,
straightforward and candid, that you can gain people's trust. Then you can find common ground."

MISSISSIPPI ROOTS

Adkerson's skills in finding common ground were honed in his hometown in Mississippi. Whether studying mathematics or working
in his parents' store, playing high-school football with Elvis Presley's cousins in Tupelo or as a national merit scholar at
Mississippi State University (MSU), Adkerson's psyche was steeped in America's post-World War II promise of unlimited
possibility.

His parents grew up on farms in west Tennessee and his father wound up managing department stores in small Southern towns.

"I think the first time I worked in a store, I was eight years old. I was part of that generation where the world was changing
and there was an expectation and an opportunity for people to have higher paying jobs and higher paying standard of living
than your parents," the executive said.

"I'm right in there with George Bush and Bill Clinton and Jimmy Buffett ... the first baby-boomers," he said with a laugh.

He has stayed true to his humble beginnings, according to Bill  Simmons, a retired accounting professor who taught Adkerson at
Mississippi State, where the executive is now president of the University Foundation Board.

"If you ran into him, you wouldn't think he had a dime. He's just an ordinary guy who has not got a big head at all," said
Simmons, who called Adkerson his best student in a 39-year teaching career.

Starting as an accountant in the oil and gas business before landing a job with Freeport in 1989, Adkerson could hardly have
imagined he would one day be involved in a multibillion-dollar deal involving mining giants. Or that, in just four years' time,
a global industrial building boom would push copper up to over $4 per pound, from 60 cents.

Having worked through the ups and downs of the oil and gas business from the 1970s and now the recent metals boom, he is
reluctant to predict prices. "People were predicting $100 oil in 1979-80; then oil went to $10 a barrel," he noted.

ENVIRONMENTAL CONCERNS

Adkerson, the father of three grown sons, has kept his home in New Orleans after the new company's headquarters moved to
Phoenix, Arizona. His house has been the target of protests by workers and environmentalists, who claim the company's mines --
particularly Grasberg -- have damaged local communities and ecosystems.

The Grasberg complex in Indonesia, one of the world's largest gold and copper mining operations, has also drawn controversy
due to the share of revenue going to native Papuans and the legality of payments to Indonesian security forces who help
guard the site.

Just like in negotiating a multibillion deal, Adkerson is keen to find common ground.

"In a lot of ways at the core of their views, I certainly do (share their views)," he said, adding that much of his free time
is spent outdoors hiking, hunting and fishing. "So it may sound ironic that you've got a guy involved in the mining industry
feeling that he wants to protect the environment."

He said environmental issues were important to Freeport's operations, not only the current effects of mining, but also
dealing with the environmental consequences of operations from years ago.

"The challenge with these environmental groups is that while many people are well-intentioned, they either are emotionally
driven or they don't have the technical understanding of how management of environmental issues needs to be dealt with."

Dealing with protests is part of the huge responsibility of heading a global mining company, Adkerson says. But when it
comes to pressure, the CEO said that sitting at the helm of the metals giant still ranks behind playing center for his high
school football team in Mississippi -- a state where football is "an obligation."
 
"I made a bad snap (pass) one night and we lost the game, and it was the headline in the paper the next day. So that was great
training," he laughed. (Additional reporting by Euan Rocha and Edward Tobin; editing by Gunna Dickson)

Jakarta Post, 22 Febuary 2008

JAYAPURA (Antara): PT Freeport Indonesia (PTFI) and Papua's provincial government are set to build a cement factory using the giant US-based copper and mining company's tailings waste as feedstock, a PTFI spokesman said.

The cement factory project would be carried out based on a Memorandum of Understanding (MoU) signed by Papua Governor Barnabas Suebu and PTFI President Director Armando Mahler some time ago, PTFI spokesman Mindo Pangaribuan said Wednesday.

"The aim of building the factory is to help process PTFI's tailings into cement products. Actually, some of PTFI's tailings are already being used in various projects in Timika. The waste can also be used in other places for infrastructure development," he said.

Mindo did not mention the details of the project, saying these matters were up to the provincial government to decide.(*)

JAKARTA, Feb 4 (AFP) -- The local Indonesian unit of US mining giant Freeport said Monday that it paid the government here 1.8 billion dollars in 2007 amid soaring commodity prices and solid production.

Freeport said that besides the amount paid for corporate income tax, employee income tax, regional taxes and levies, it also paid 216 million in dividends and 164 million dollars in
royalties to the government.

The annual amount was 12.5 percent up on the 1.6 billion dollars the company, which is believed to be Indonesia's most significant taxpayer, paid in 2006, it said in a statement.

The payment amount fluctuates due to changes in commodity prices, sales and metal production levels.

Freeport said it had paid a total of 6.9 billion dollars to Jakarta from 1992 to 2007, in line with fulfilling its financial obligations under a 1991 contract with the Indonesian government.

"In the past two years our production has been good and commodity prices have also skyrocketed," Mindo Pangaribuan, a Freeport spokesman, told AFP.

Freeport Indonesia is 81 percent owned by US-based Freeport McMoRan. The remaining stakes are shared equally between the Indonesian government and company Indocopper Investama.

Freeport operates a huge gold and copper mine in Indonesia's easternmost Papua province.

Environmentalists have accused the mine of polluting the World Heritage-listed Lorenz National Park and dumping copper-rich ore around the edge of its operations. The firm disputes the claims.

By Jae Hur

Jan. 23 (Bloomberg) -- Freeport-McMoRan Copper & Gold Inc., the world's second-largest copper producer, won a cut in 2008 fees for processing the metal from Japanese smelters this week after rival BHP Billiton Ltd. reached a similar settlement.

The Phoenix-based company agreed so-called treatment and refining charges with smelters, including Pan Pacific Copper Co., Japan's biggest. It cut the fees for Sumitomo Metal Mining Co. and Mitsubishi Materials Corp. by 25 percent, respective company spokesmen Satoshi Oku and Nobuyuki Suzuki said by phone
today.

Lower charges for processing copper concentrates into refined metal, used in wires, tubes and pipes, may boost earnings for mining companies, including BHP and Freeport. They may also squeeze profit margins at smelters, affecting production levels.

``We reached a deal with Freeport on Jan. 21,'' Oku said. ``It was the same level as we settled with BHP last week.''

A phone call to Freeport spokesman William Collier was connected to a recorded message outside of normal office hours.

Pan Pacific, Japan's top copper smelter, also reached agreement with Freeport, said company spokesman Kan Komatsuzaki. He declined to give details of the fee level.

Pan Pacific is a joint venture between a unit of Nippon Mining Holdings Inc. and Mitsui Mining & Smelting Co. BHP Settlement

BHP, the world's biggest mining company, settled 2008 copper processing fees with major Japanese smelters last week at $45 a metric ton for smelting ore and 4.5 cents a pound for refining, down from last year's $60 and 6 cents.

Treatment charges are expressed in dollars per ton of concentrate received and refining fees in cents per pound of copper contained in the concentrate. The fees, which are deducted from the price paid by smelters to miners for the concentrate, usually fall when there is a shortage of the raw material as smelters compete for supplies.

BHP owns the Escondida mine, the world's largest copper mine, in Chile, while Freeport has the Grasberg mine, the world's second-largest, in Indonesia.

London Metal Exchange copper for delivery in three months, which reached a record $8,800 a ton in May 2006, gained 5.5 percent last year and traded at $6,960 a ton at 3:55 p.m. Singapore time.

BHP and other mining companies last year terminated so called ``price-participation'' clauses allowing smelters to benefit from copper price gains.

PHOENIX, Jan 23 (AP) - Freeport-McMoRan Copper & Gold Inc., one of the world's biggest copper miners, said Wednesday its fourth-quarter earnings fell 3 percent from a slew of one-time charges and higher costs, despite surging revenue.

Shares tumbled more than 8 percent, or $6.81, to $74.71 early Wednesday.

The company earned $414 million, or $1.05 per share, compared with a year-ago profit of $426 million, or $1.99 per share.

The miner recorded one-time charges of $120 million, or 29 cents per share, including accounting-related adjustments on the price of copper, higher property and equipment costs and debt reduction. Freeport-McMoRan recorded charges of $426 million, or $1.99 per share, in previous fourth quarter.

Revenue soared to $4.18 billion, from $1.64 billion in the prior-year period. The company said revenue was lifted by strength in its large-scale copper and molybdenum operations in the Americas.

Analysts expected a profit of $1.68 per share on revenue of $4.43 billion, according to a poll by Thomson Financial. Analyst forecasts typically exclude one-time charges.

Company executives said they expect to continue development of mines in the Democratic Republic of Congo, the Americas and Indonesia in the coming year.

"We have significant reserves and growth opportunities to supply products to a world that has growing requirements for the commodities we produce," James R. Moffett, chairman of the company's board, and CEO Richard C. Adkerson said in a written statement.

The company expects consolidated 2008 sales from mines of about 4.3 billion pounds of copper, 1.3 million ounces of gold and 75 million pounds of molybdenum.

AP Business Writer Samantha Bomkamp in New York