Grasberg Minerals District

Description: The Grasberg minerals district includes open-pit and underground mines.

Did You Know? PT Freeport Indonesia (PT-FI) commenced mining operations in 1972 and in 1988 discovered the Grasberg mine. Today, after significant production, the Grasberg mining district contains one of the world’s largest recoverable copper reserve and the largest gold reserve.

Location:  The remote highlands of the Sudirman Mountain Range in the province of Papua, Indonesia, which is on the western half of the island of New Guinea.

Ownership: 90.64% FCX (including 9.36% owned through our wholly owned subsidiary, PT Indocopper Investama); 9.36% the Government of Indonesia.

Mines, Processes and Facilities: The Grasberg minerals district has three operating mines: the open pit, the Deep Ore Zone underground mine and the Big Gossan underground mine where operations restarted in fourth-quarter 2016. In addition, in September 2015, PT-FI initiated pre-commercial production at the Deep Mill Level Zone (DMLZ) underground mine. PT-FI also has several projects in progress in the Grasberg minerals district related to the development of the large-scale, long-lived, high-grade underground ore bodies located beneath and nearby the Grasberg open pit, including the Grasberg Block Cave underground mine. In aggregate, these underground ore bodies are expected to produce large-scale quantities of copper and gold following the transition from the Grasberg open pit..

Grasberg open pit. We began open-pit mining of the Grasberg ore body in 1990 and are currently mining the final phase of the Grasberg open pit, which contains high copper and gold ore grades. PT-FI expects to mine high-grade ore over the next several quarters prior to transitioning to the Grasberg Block Cave underground mine during 2018. Additionally, production from the ore stockpiles, which are located outside of the pit limits, is expected to continue until early 2019.

Crushing and conveying systems are integral to the Grasberg mine and provide the capacity to transport more than 250,000 metric tons of ore per day.

DOZ underground mine. The DOZ ore body lies vertically below the now depleted Intermediate Ore Zone. We began production from the DOZ ore body in 1989 using open stope mining methods, but suspended production in 1991 in favor of production from the Grasberg open pit. Production resumed in September 2000 and is expected to continue through 2021.

Using ore passes and chutes, load-haul-dump units transfer ore into haul trucks. The trucks dump into two gyratory crushers and the ore is then conveyed to the surface stockpiles for processing.

The success of the development of the DOZ, one of the world’s largest underground mines, provides confidence in the future development of PT-FI's large-scale, underground ore bodies.

DMLZ underground mine. The DMLZ ore body lies below the DOZ underground mine at the 2,590-meter elevation and represents the downward continuation of mineralization in the Ertsberg East Skarn system and neighboring Ertsberg porphyry. In September 2015, PT-FI initiated pre-commercial production at the DMLZ underground mine, which represents ore extracted during the development phase for the purpose of obtaining access to the ore body.

Targeted production rates once the DMLZ underground mine reaches full capacity are expected to approximate 80,000 metric tons of ore per day in 2022. Production at the DMLZ underground mine is expected to continue through 2041.

Big Gossan underground mine. The Big Gossan mine lies underground and adjacent to the current mill site. It is a tabular, near-vertical ore body. Production from the Big Gossan ore body, which restarted in fourth-quarter 2016, is expected to ramp up to 7,000 metric tons of ore per day in 2022.

The Big Gossan mine utilizes a blasthole stoping method with delayed paste backfill. Stopes of varying sizes are mined and the ore dropped down passes to a truck haulage level. Trucks are chute loaded and transport the ore to a jaw crusher. The crushed ore is then hoisted vertically via a two-skip production shaft to a level where it is loaded onto a conveyor belt. The belt carries the ore to one of the main underground conveyors where it is transferred and carried to the surface mill stockpile for processing.

Description of Ore Bodies: The ore bodies are located within and around two main igneous intrusions, the Grasberg monzodiorite and the Ertsberg diorite. The host rocks of these ore bodies include both carbonate and clastic rocks that form the ridge crests and upper flanks of the Sudirman Range, and the igneous rocks of monzonitic to dioritic composition that intrude them. The igneous-hosted ore bodies (the Grasberg open pit and block cave, and portions of the DOZ block cave) occur as vein stockworks and disseminations of copper sulphides, dominated by chalcopyrite and, to a much lesser extent, bornite. The sedimentary-rock hosted ore bodies (portions of the DOZ and all of Big Gossan) occur as “magnetite-rich, calcium/magnesian skarn” replacements, whose location and orientation are strongly influenced by major faults and by the chemistry of the carbonate rocks along the margins of the intrusions.

The copper mineralization in these skarn deposits is dominated by chalcopyrite, but higher bornite concentrations are common. Moreover, gold occurs in significant concentrations in all of the district’s ore bodies. These gold concentrations usually occur as inclusions within the copper sulphide minerals, though, in some deposits, these concentrations can also be strongly associated with pyrite.

The Grasberg complex shown below illustrates the layout of the Grasberg/ Ertsberg minerals district reserves. The western side of the district is dominated by the Grasberg, with its massive open pit (final design shown) and block cave mineable reserves, and the Kucing Liar and Big Gossan ore bodies. The eastern side of the district is dominated by the Ertsberg East ore bodies, the DOZ and the DMLZ. The underground production and exploration access to these ore bodies is shown.