Freeport-McMoRan Inc. expects to have permits in place “imminently” to resume exports of semi-processed copper from Indonesia for the next six months, allowing the miner to focus on fleshing out a long-term agreement to stay in the country. “We have been working with the government on this approach, but it has not yet been formally documented,” Chief Executive Officer Richard Adkerson said in an interview in Santiago on Wednesday. “We understand that’s to happen immediately and that there are no areas of controversy in the documentation.” Indonesian authorities said on Tuesday they issued a mining license, that will allow Phoenix-based Freeport to resume exports of copper concentrates once the trade ministry signs off, which Adkerson said is a administrative matter that doesn’t involve additional negotiation. The resumption of shipments at the world’s second-biggest mine will further ease supply constraints in copper after strikes at a Freeport mine in Peru and BHP Billiton Ltd.’s Escondida in Chile. It would also bring a welcome boost to the local economy via state revenue and jobs. ‘Positive Step’ “This step is a positive step for the process,” Adkerson said in the interview. “It’s in nobody’s interest to keep us from exporting.” Through its Indonesian arm, Freeport has majority ownership of the Grasberg copper-and-gold mine, which generated about 18 percent of its revenue last year. The world’s largest publicly traded copper producer has been embroiled in complex negotiations with Indonesia for years as it attempted to extend its so-called Contract of Work, or CoW, in the country that’s set to expire in 2021. Abrupt Turn In January, the talks took an abrupt turn when the government announced foreign miners, including Freeport, would be required to switch to a special mining licenses, or IUPK, to maintain the right to export semi-processed metals, including concentrates. As part of the change, Freeport also would be required to build smelters and divest 51 percent of its stake to local interests. Freeport balked at the demands, vowing to hold onto its Contract of Work unless it gets a new long-term stability agreement that offers the same legal and fiscal framework for its presence in the country. In January, the government suspended Freeport’s right to export concentrates and in response the company began to curtail production and lay off workers. In February, Freeport served notice saying it has the right to begin arbitration in 120 days if it can’t reach an agreement. Gresik Smelter In Wednesday’s interview, Adkerson said that while the notice stands, arbitration wouldn’t happen if talks are proceeding well. Grasberg is currently running at about 40 percent to feed a smelter in Gresik on Java island. Adkerson said he’s optimistic the two sides will strike a long-term deal that would retain “the important elements of the CoW.” He said: “We are going into it with good faith and I believe the government will too,” he said. “So the likelihood is that there will be a solution.” On Thursday, Indonesia said it will continue to insist that Freeport change its CoW into an IUPK, build a smelter and divest the 51 percent stake, according to a statement from Hadi Djuraid, special staff at the Energy and Mineral Resources Ministry, posted on the cabinet secretariat’s website. Freeport and the government will start talks on the long-term issues next week, he said. Declining to discuss Freeport’s objectives for the stability agreements, Adkerson referred to a 2014 Memorandum of Understanding in which it agreed to increase royalties, build a smelter and divest as much as 30 percent. He said while the company’s shareholders are being “very supportive,” they’re struggling to understand why the government isn’t respecting the contract. Long-Term Rights “They clearly don’t want us to give up our long-term rights just for the short-term ability to export,” he said, referring to shareholders. One of those shareholders is Carl Icahn, an activist investor and special adviser to U.S. President Donald Trump on regulatory matters, who Adkerson said holds “just over 6 percent” of the company. While the CEO is unaware of any involvement by Icahn in the Grasberg efforts, he said the company has been updating the U.S. administration directly on the matter. The contract talks in Indonesia are of national interest given the high number of U.S. citizens who have part of their savings invested in funds that own Freeport stock, Adkerson said. That interest extends to the financial viability of a company whose domestic mines account for about 40 percent of copper in the U.S., he said. ‘Significant Interest’ “We expect the U.S. government will be very supportive of our position,” Adkerson said. “As well, our partner Rio Tinto is duly incorporated in Great Britain and Australia and they have a very significant interest in this.” Rio Tinto Group has an interest in the outcome of the talks through a joint venture with Freeport. Under the terms of the partnership, Rio is entitled to a 40 percent share of output in Grasberg above specific levels until 2021 and 40 percent of all production after that year. If talks fail to yield a mutually beneficial arrangement, Freeport’s best option could be a full sale of Grasberg, according to Jefferies LLC analyst Chris LaFemina. If that happened it would likely be to the Indonesian government, possibly with a third party or as part of a consortium, in which case the sale would be at a significant discount, LaFemina said Tuesday in an interview from New York. Based on valuations, the Indonesian government made a year ago, LaFemina estimates the net present value for the asset at $5.91 billion. That compares to an NPV of $9.8 billion if the political risk were eliminated and the company was allowed to be operated under its current CoW until 2041, the Jefferies analyst said. In January 2016, Freeport valued its Indonesian operations in a government filing, excluding Rio’s interest, at $16 billion, Adkerson said. “The notion of trying to sell this business with these degrees of uncertainties hanging over it would be difficult,” he said on Wednesday.