One of the largest waste volumes at our operations is in form of sirsat (remaining water and very fine natural rocks on the ground surface after the concentrate is separated from the ores at the processing factory). The processing/concentrate process of PT. Freeport Indonesia is a physical process where the ores are finely grinded and the minerals containing copper and gold are separated from the rock particles of non economic value. Due to the special topography of the site, its seismic activity and annual rainfall exceeding 10 meters at several locations, we use the controlled sirsat management system through the river flow, which transports the sirsat to an area specified at the lowland and coastal zone, which is referred to as the Modified Ajkwa Deposition Area (Mod ADA). This sedimentation area is a part of the river flood shoal, and is an engineered system, managed for the sedimentation and control of the sirsat.

This management system is carried out under the comprehensive sirsat management plan of PT. Freeport Indonesia, which is approved by the Government after conducting a lot of technical studies and a multiple-year review process. This system engages the construction of the lateral accommodation structure, or dike, for the sedimentation area. Those dikes are afterwards broadened and continuous work is carried out for various system improvements, including inspection, monitoring and physical development. We are continuously evaluating and updating the sirsat management plan in order to minimize the risks. Our research shows that when the mining operations are completed, this sedimentation area can be reclaimed with natural vegetation or can be utilized for agricultural, forestry or fishery activities. The average annual cost to implement this sirsat management program during the last three years is around US Dollar 15.5 million.

We have implemented a program to recycle sirsat as concrete mixture material for the development of local infrastructures. We have constructed a road of 39 kilometers in the Papua Province in 2007 and 2008 by using sirsat as the main element. We also produce bricks, bridges parking lots and a number of buildings. This material is used at the company program for local building assistance. For example in 2010, more than houses of the community members use this material. The government and the local community provide good response and we are intended to continue these efforts in the coming years.