Freeport-McMoRan, the world’s largest publicly traded copper producer, announced a slower-than-expected recovery at its Grasberg mine in Indonesia following a fatal flood last year. The company now anticipates only 65% production restoration by the second half of the year, down from 85%. This delay affects Freeport’s ability to meet rising global copper demand, particularly from the artificial intelligence and power generation sectors.
The mine’s ore has become unexpectedly wetter due to groundwater, necessitating the installation of “spillminators,” specialized mining chutes designed to prevent mud rushes. CEO Kathleen Quirk stated that modifications will take time. Additionally, Freeport has postponed its plan to convert Grasberg’s power source from coal to natural gas by about 18 months.
The company expects to produce 800 million pounds of copper and 700,000 ounces of gold this year, a reduction from earlier estimates of 1.1 billion pounds of copper and 800,000 ounces of gold. Rising diesel prices have also increased annual costs by $500 million.
