Reuters article
Indonesia Suharto-linked group raises Busang stake
Reuters Story - April 23, 1997 01:47
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By K.T. Arasu
JAKARTA, April 23 (Reuter) - An Indonesian company linked to
President Suharto has raised its stake in the Busang property
days before a verdict is due on whether it is the biggest gold
discovery this century, a Busang partner said on Wednesday.
Ahmad Yani Syakerani said his family-controlled PT Askatindo
Karya Minerals had reduced its stake in the Busang II section --
once touted as cradling the motherlode -- in favour of its
50-percent partner, the Nusamba Group.
Test cores drilled by Canadian consulting company Strathcona
Mineral Services Ltd at Busang over the past few weeks are
currently being assayed to determine the gold content and the
results are expected in early May.
Bre-X Minerals Ltd , the small Alberta-based mining
company that found Busang, shocked the world last month with a
statement that the amount of gold might be less than previously
estimated. It had earlier put gold reserves at 70.95 million
ounces, which would have made it the find of the century.
Nusamba is 80-percent owned by three foundations headed by
President Suharto. Indonesian business tycoon Muhammad "Bob"
Hasan and Suharto's eldest son Sigit Harjojudanto each have a 10
percent stake.
Askatindo, another Syakerani family-controlled company PT
Amsya Lyna and Nusamba hold a 30-percent stake in the Busang
property in Indonesia's East Kalimantan province.
"Nusamba now has 25 percent and Askatindo has five percent
in the Busang II section," Syakerani told Reuters.
The Busang project is centered on the Busang II section in
the southeast.
Nusamba, headed by Hasan as chairman, took a 50-percent
stake in Askatindo in January amid a bidding war for Busang.
Syakerani said the ownership stakes of other companies in
the Busang property remained intact.
Bre-X has a 45-percent stake in Busang, Freeport McMoRan
Copper and Gold Inc of the United States has 15 percent
and the Indonesian government 10 percent.
Freeport has said its own test drillings in Busang had
indicated "insignificant" amounts of gold.
Bre-X hired the Toronto-based Strathcona to carry out an
independent audit to determine the amount of gold at Busang.
Syakerani declined to discuss how much Askatindo would be
paid for selling most of its Busang stake to Nusamba, but said
the sale was based on financial considerations.
"We are not strong financially," he said. "In case we
(Busang partners) need to raise $1 billion to develop Busang, we
(Askatindo) will not be able to meet our share of the costs if
we had a 15-percent share."
"That's why we are reducing our share," he said. "Our
financial abilities are limited. It's better if our stake is
within our financial capability."
Syakerani said the change in the shareholding of Askatindo
and Nusamba in Busang had been conveyed to the mines and energy
ministry. "As for the stakes held by Bre-X and Freeport, there
will be no changes," he added.
Mines and Energy Minister Ida Bagus Sudjana said on Tuesday
there would be changes in the ownership structure of minority
partners involved in the Busang project but gave no details.
He said the government would delay giving final approval to
the ownership composition in the Busang property until the
results of the Strathcona audit were known. |
