Consistent with our responsibility as a corporate citizen and the Voluntary Principles on Security and Human Rights, as well as our duty to protect our employees and property, our international operating sites have taken appropriate steps to provide a safe and secure working environment. As part of these security programs, we maintain our own internal security departments, which perform functions such as protecting company facilities, monitoring the shipment of company goods, assisting in traffic control and aiding in rescue operations.

In certain of the remote locations, such as Papua, Indonesia, and Katanga, Democratic Republic of Congo, we, on the same basis as all businesses and residents of these respective countries, rely on the respective governments for the provision of public order, upholding the rule of law and protection of personnel and property. In Indonesia, the Grasberg mine has been designated by the government as one of Indonesia’s national vital assets. This designation as a national vital asset has historically resulted in the Indonesian security institutions (including both police and military) playing a significant role in protecting our area of operations. The governments are responsible for employing their respective security personnel and funding and directing their operations. However, because of the limited resources of the respective governments, the remote locations and lack of development in these countries, the governments look to us to provide logistical and infrastructure support, as well as supplemental funding for these necessary services.

The support for the government-provided security in these foreign locations includes in-kind assistance and monetary allowances to mitigate living costs and the hardship elements of assignment to the mining areas. This type of support helps maintain positive morale, ensures that personnel are properly fed and lodged and provided the logistical resources necessary to patrol and secure our operating area. This support for the government security institutions assigned to our area of operations represents a prudent and considered step by us to protect our workforce and property, and to meet the expectations imposed by the respective governments on companies conducting business in remote areas. This provision of support is consistent with our obligations under our agreements with the respective governments, our philosophy of responsible corporate citizenship, the joint U.S. State Department-British Foreign Office Voluntary Principles on Human Rights and Security, and is in keeping with our commitment to pursue practices to promote human rights. We periodically review our support practices to ensure that they are appropriate, lawful and properly controlled.

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