Workers at the world's largest Copper and Gold site, Freeport-McMoran Copper & Gold's subsidiary in Papua have dropped their minimum wage increase demands from $7.50 to $4 an hour, the All Indonesian Workers Union said on Monday.

Virgo Solosa, an official from the union, known as the SPSI, told the Jakarta Globe that they considered the demands, up from the current minimum wage of $1.50 an hour, to be the best solution for all.

Virgo said Freeport management were currently offering $3 an hour.

He said the union was also demanding that striking workers that had been fired by the company be rehired without sanctions.

It should also be applied to contract workers, he said. There should be no sanctions and both sides should learn a lesson from the strike.

The Grasberg mine is estimated to be running at 5 percent of its full capacity during the crippling strike.

Virgo said the $4 an hour figure was approved, employees would work to catch up on the lost production.

The union and Freeport management are meeting again today.

Gunmen opened fire near Freeport-McMoRan's Grasberg gold and copper mine in Papua on Monday, injuring a police officer in the latest in a string of attacks.

National Police spokesman Insp. Gen. Usman Nasution said the officer was wounded in the right cheek.

The shots were fired on a Freeport vehicle that was being driven by a policeman from the pioneer task force, which works in isolated areas, he said.

The victim, identified as First Brig. Marcelinus, is being treated at a Freeport hospital, he said.

The shooting took place near Mile 45 of the main road leading to the mine at about 11:20 a.m.

Papua Police spokesman Sr. Comr. Wachyono said the shots were fired from the cover of the forest near the road.

When it came under attack, the patrol car sped up to reach the nearest security post, he said. Wachyono said Marcelinus and another officer in the Freeport-owned vehicle were on routine patrol.

He said that members of the pioneer task force were searching for the attackers and that officers had scoured the scene of the shooting for clues.

Papua Police Chief Insp. Gen. B.L. Tobing said all of the shootings that had occurred near the mine, including Monday's attack, had taken place under the cover of the rain forest, making it difficult to hunt down the assailants.

We are a bit overwhelmed because the geographical locations is very difficult, with thick forest and really steep rock facades, he said.

Tobing said all of the shootings followed the same hit-and-run pattern, with the attackers fading into the forest by the time reinforcements arrived.

Our facilities are limited and such difficult terrain would require a helicopter for air reconnaissance, he said. The police, he added, do not have a helicopter.

Meanwhile, National Police Chief Gen. Timur Pradopo said internal investigations had found no violations regarding Freeport's long-standing practice of giving money to the police for their operations there.

So far, it is just seeing how policemen there live, he said. Their life there is very difficult. So far, no violations have been found.

Timur recently acknowledged during a meeting with the House of Representatives in Jakarta what had long been suspected, that Freeport paid meal money to police officers safeguarding its operations at Grasberg.

The admission sparked indignation, with activists saying police operations should be covered by the state budget, not the private sector.

Sr. Comr. Boy Rafli Amar, another spokesman for the National Police, said the payments were acceptable considering the difficult conditions in Papua and the limited police budget.

How can we use up so much money for the area when 400,000 of our other personnel, from Sabang to Merauke, also need operational funding? he said, adding that the police's annual operational budget was Rp 4.2 trillion ($470.4 million).

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