Freeport Death Toll Increases to 17 as CEO Adkerson Arrives

The death toll from an accident at Freeport-McMoRan Copper & Gold Inc.’s Grasberg mine complex in Indonesia rose to 17 as Chief Executive Officer Richard Adkerson arrived in the country.

Work has been halted at the world’s second-largest copper mine since a tunnel collapsed on May 14. Of the 38 workers who had been in a classroom in an underground training facility at the time of the accident, 10 have been rescued and 11 are believed still buried under the rubble, according to an e-mailed statement today.

“I am deeply saddened and disturbed by this event,” Adkerson said in a statement today. “Our focus continues to be continuing efforts to gain access to the victims still buried at the accident, carried out as quickly as can be done safely.”

Grasberg in Mimika, Papua province, about 3,120 kilometers (1,940 miles) east of Jakarta, includes underground and open-pit operations and is the world’s second-biggest by output, Freeport said in a March 14 presentation. The company was still shipping concentrate, a semi-processed form of metal ore, as of May 17, its local unit said last week.

Adkerson flew into Timika in Papua on May 18 and, together with PT Freeport Indonesia President Director Rozik B. Soetjipto, has been visiting injured workers and the families of those still missing, Freeport said yesterday. Indonesian President Susilo Bambang Yudhoyono called last week on Freeport to step up rescue efforts at the mine.

Accident Investigation

The Grasberg complex generated $3.92 billion of revenue for Freeport last year, or 16 percent of the company’s sales. Freeport owns 91 percent of the mine, which also produces gold, and Indonesia’s government holds the rest, according to the company’s website.

The government should conduct a thorough investigation of the accident, said Virgo Solossa, head of the Mimika branch of the All-Indonesian Workers Union in the Chemical, Energy and Mining Sectors, whose members include the labor union at Freeport Indonesia.

“We demanded that all operations at Freeport remain halted until the investigation is concluded, that is the least they can do to value the life and the families of the victims,” Solossa said May 17 by phone from Mimika.

Safety Lesson

The government would seek to improve mining safety procedures, Coordinating Minister for the Economy Hatta Rajasa told reporters in Jakarta May 17.

“A government team will conduct an investigation and after they’re finished, we will see what needs to be done,” he said. “This can be used as a lesson on how we can strengthen the safety of underground mining.”

Freeport Indonesia was still shipping concentrate as of May 17, Daisy Primayanti, vice president of corporate communications at the company, said by mobile-phone text message on May 18. The company used concentrate that was delivered to the port site before it suspended operations, she said.

Freeport has halted the negotiation process for the 2013-2015 Collective Labor Agreement because of the accident, it said last week. The company and its labor union had started contract negotiations on May 13.

Output at Grasberg was disrupted in 2011 and 2012 after labor unrest and violence. The company said in a February filing that 15 people died and 57 were injured in 37 shooting incidents in and around the complex between July 2009 and Feb. 15 this year.

BHP Billiton Ltd.’s Escondida mine in Chile is the world’s largest copper mine.

Freeport today won the approval of Plains Exploration & Production Co. shareholders for a $6.6 billion takeover after offering Plains holders an extra $3 a share in a one-time special cash dividend, plus another $1 for each share in Freeport they own after the merger closes. Freeport announced on Dec. 5 it planned to buy both Houston-based Plains and McMoRan Exploration Co.