Me
Last Post. Does anybody know the tune?
Rick
By Muklis Ali
JAKARTA, Jan 17 (Reuter) - Proposals to develop one of the
world's biggest gold finds in Indonesia took a step forward on
Friday with a government reply to a joint submission by two
Canadian mining companies after weeks of uncertainty.
Mines and Energy Ministry secretary-general Umar Said said
the ministry had replied to the submission by Bre-X Minerals Ltd
and Barrick Gold Corp outlining their
agreement to develop the huge Busang gold find in remote East
Kalimantan province.
Bre-X estimates the property contains at least 57 million
ounces of gold currently worth over $21 billion.
"We have replied to the letter from Bre-X and Barrick
today," Said told Reuters. "The letter says, among other things,
that they must settle with their local partners soon."
He did not give other details, but a ministry source said
the government "understood" an agreement between Barrick and Bre-X to split the richest parts of Busang 67.5 percent and 22.5
percent respectively. The Indonesian government gets the rest.
"We understand the agreement between Bre-X and Barrick on
their wish to split 67.5 percent for Barrick, 22.5 percent for Bre-X and 10 percent for the Indonesian government. It is
contained in the letter," the source said.
Bre-X has a partnership deal with PT Askatindo Karya
Minerals, controlled by Kalimantan businessman Syakareni, who
told Reuters on Wednesday he had sold a stake in his company to
local timber baron Muhammad "Bob" Hasan.
An industry source said Hasan was believed to have bought a
50-percent stake in Askatindo, which has a 10-percent stake in
the richest parts of the Busang property.
Syakareni said a senior executive in PT Panutan Duta,
controlled by President Suharto's eldest son Sigit Hardojudanto,
had been included in Askatindo's management, along with Hasan.
Barrick has a partnership deal with Suharto's eldest
daughter, Siti Hardianti Rukmana.
The Busang deposit is located under a canopy of lush
tropical rainforests and rugged hills on Borneo Island. It is
some 200 km (125 miles) northeast of East Kalimantan's capital,
Samarinda, and is traversed by a tributary of the Mahakam River.
It lies 250 km (150 miles) east of the border with
Malaysia's Sarawak state, which together with Malaysia's Sabah
state to the north, the tiny oil-rich kingdom of Brunei and
Indonesia's Kalimantan share Borneo.
"Busang is in difficult terrain. It's hilly, in dense jungle
without any infrastructure and is thinly populated," said the
head of a mining company that has a project in the region.
"It lacks proper roads and infrastructure, but has a
fantastic river system that can take barges of up to 1,000
tonnes," said the official, who declined to be identified.
In another twist, Indonesian businessman Jusuf Merukh, who
claims to own 40 percent of the Busang property, filed a C$2
billion ($1.48 billion) lawsuit in Canada last Tuesday against Bre-X, which does not recognise his claim.
Merukh has an undisputed 10 percent interest in the Busang I
area of the gold find in East Kalimantan province. The richest
parts are Busang II and III, where he is claiming a stake. |
