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Freeport-McMoRan has announced force majeure at its Grasberg mine in Indonesia on Wednesday September 24. It said that copper and gold output could be about 35% lower in 2026 than previously estimated. The world’s second-largest copper mine was initially forecast to produce 1.7 billion pounds of copper and 1.6 million ounces of gold in 2026. However, it was closed earlier this month following an incident that resulted in seven workers being trapped.
Freeport’s local unit, PT Freeport Indonesia (PTFI), shut down operations after the September 8 incident. On Wednesday, Freeport said the bodies of two of the trapped workers had been located on September 20. The search was ongoing.
The miner said it’s still assessing the full impact of the incident. However, initial investigations suggest the deferral of significant production in the fourth quarter of this year and into 2026 while repairs are completed. A phased restart and ramp-up of operations will commence.
Grasberg could potentially return to pre-incident production levels in 2027, Freeport said.
“As a result of the incident and the impact on operations, PTFI is notifying commercial counterparties of a force majeure in accordance with the provisions of its contracts,” Freeport said.
Mines that were not affected by the incident, such as the Big Gossan and Deep MLZ mines, are expected to restart operations by the middle of the fourth quarter this year, the company said. The Grasberg Block Cave Mine is expected to begin a phased restart in the first-half of 2026.
PTFI’s fourth-quarter sales of copper and gold will be insignificant, Freeport said. Initially, they forecast sales of 445 million pounds of copper and 345,000 ounces of gold.
Freeport joins peers including Chile state miner Codelco which are grappling with copper output losses mostly from mines disruptions.
Codelco suspended operations at its El Teniente operation on July 31 after an underground tunnel collapsed, killing seven workers.
Copper miners including Anglo American, Glencore, Teck Resources and Ivanhoe Mines are also struggling to raise output due to poor grades, inadequate water supplies and seismic activities.
Prior to the Grasberg incident, Fastmarkets estimated that 497,000 tonnes of copper was lost so far this year due to mine disruptions.
Fastmarkets’ assessment of the copper concentrates TC index, cif Asia Pacific, the mid-point between smelter and trader buying levels, was $(63.30) per tonne on September 19, down by $0.30 per tonne from $(63.00) per tonne on September 12.
Freeport said capital projects will be reviewed and managed to prioritize resource needed to restore safe production.
“It sounds like the investigation that is keeping the operations halted is not expected to be completed by year-end 2025,” Fastmarkets analyst Andy Cole said. “So a big hit for fourth quarter production too.”
The incident at the Grasberg Block Cave (GBC) mine occurred after about 800,000 tonnes of wet material entered the mine and travelled rapidly to multiple mine levels, including the service level of the mine where the missing team members were conducting development activities, Freeport said.
The GBC will be restarted in phases from first-half next year and could return to pre-incident estimates in 2027.
“This is starting to sound a lot worse than initially thought. “Return to pre-incident operation rates in 2027,” and only a “potential return” at that. That’s a big one,” Cole said.
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