Nani Afrida, Jakarta – PT Freeport Indonesia has bowed to government pressure on alleged violation of regulations concerning operating in protected forests, saying the company would apply for the necessary permits to remain operating in existing mining areas.

"(We are) ready to engage in talks with the government on the possibility of applying for land use rights for several areas," the company said in a statement issued on Wednesday.

The company, however, clarified that it is protected under law by special rights that allow it to operate in protected forests.

The subsidiary Freeport-Mc Moran Copper and Gold Inc. – the world's biggest gold producer, said that the company's contract of work (KK) with the government was older than the 1999 law on forestry, which forbade open-pit mining in protected forests.

Freeport Indonesia said the legal status of its operations in protected forests has been confirmed by a 2004 amendment to articles in the 1999 law. This says that provisions on the open-pit mining restrictions stipulated in the 1999 law are not retroactive, meaning they do not apply to contracts of works signed prior to the enactment of the law.

Previously, the Forestry Ministry sent a letter to the company demanding the company apply for a land use permit for several areas where its operations are located in protected forests.

Forestry Minister Zulkifli Hasan said he had warned Freeport Indonesia on the matter and that he would issue another warning letter should the company fail to comply with the ministry's demand.

Speaking in a hearing session with lawmakers on Monday, Zulkifli urged law enforcers to act on violations committed by big mining corporations. He said there were 11 other mining companies, apart from Freeport Indonesia, that had violated these restrictions.

Zulkifli's demand to Freeport Indonesia received direct blessing from Energy and Mineral Resources Minister Darwin Zahedy Saleh. Tempo daily in its Wednesday publication quoted Darwin saying that the warning letter was appropriate.

Darwin said the gold and copper company should follow the regulations and comply with the ministry's demand. "It is better for Freeport to make the right move," he said.