Markus Junianto Sihaloho – A local NGO is urging the government to propose contract renegotiations with Freeport Indonesia to force the company to pay proper royalties for its mines.

During a meeting with Deputy House Speaker Pramono Anung on Monday, Gunawan, a coordinator for the Indonesian Human Rights Committee for Social Justice (IHCS), said he had filed a lawsuit in the South Jakarta District Court regarding Freeport's contract, known as Kontrak Karya.

The court ordered mediation between the parties. "Now we want the government and the House to use mediation to force Freeport management to renegotiate the contract," Gunawan said.

Gunawan said that the government and the House should renegotiate and make Freeport pay a royalty of 3.7 percent of its production since 2003 and commit to paying the same percentage for future production.

"It is clear in the Constitution that natural resources should be managed for the benefit of the people," Gunawan said. "The government and the House should fight for this."

IHCS estimated that Freeport should have paid around Rp 2.2 trillion ($256 million) since 2003.

"Actually, a royalty at 3 to 4 percent is very low in comparison to other countries," Gunawan said. "In African countries, the royalty is around 5 to 8 percent. Even Venezuela is drafting a law to get the royalty above 50 percent."

Ray Rangkuti, director of the Indonesian Civic Network (LIMA) urged the government to temporarily close Freeport's mining operations during the renegotiation process.

"As long as it is in Indonesia, it has to comply," Ray said. "During the negotiation, please close it down. Don't let it operate until the debt has been paid and renegotiation completed."

Thousands of workers at Freeport-McMoran's gold and copper mine in eastern Indonesia began a monthlong strike in mid-September demanding higher wages in line with those received by Freeport workers in other countries.