Busang still draws investors, says minister<\/p>\n
JAKARTA (JP): Many foreign investors are reportedly interested
\nin the scandal-plagued Busang mine in East Kalimantan despite a
\ndefinitive study stating it is devoid of commercial gold
\ndeposits.<\/p>\n
Minister of Mines and Energy Kuntoro Mangkusubroto said
\nyesterday gold prospectors were requesting government permits to
\nexplore the area, but added there would be no issuance since the
\nlegal investigation into the former holder of the contract area,
\nBre-X Minerals Ltd of Canada, was ongoing.<\/p>\n
\"We are waiting for a report (from the Canadian police) that
\nthe investigation is complete so that we can reopen the area,\"
\nKuntoro told reporters in a weekly media conference.<\/p>\n
Kuntoro said the ministry had given a deadline to the Canadian
\npolice to finish the probe but he did not specify the date.<\/p>\n
Bre-X announced in 1996 that it had discovered just under 71
\nmillion ounces of gold in the Busang area, making it the largest
\ngold discovery of the century and one of the greatest in history.<\/p>\n
The announcement set off a spiral of dramatic events,
\nincluding the astronomical rise of Bre-X's shares on the Toronto
\nStock Exchange and a fight pitting several giant mining companies
\nfor a stake in Busang.<\/p>\n
Indonesian political and business elites, including the family
\nof former president Soeharto, also squared off in the fray.<\/p>\n
Suspicions the estimate was grossly exaggerated were fanned
\nafter Bre-X's Filipino project manager was killed after falling
\nfrom a helicopter in March last year.<\/p>\n
Canadian independent consultant Stratchona Minerals Ltd
\nannounced the following May there was no commercial gold in
\nBusang, and suspected that Bre-X had salted the ore to support
\nits claim of a large gold reserve.<\/p>\n
Bre-X's shareholders in Canada subsequently filed a lawsuit
\nagainst the company, and the Indonesian government froze Bre-X's
\ncontracts in the country.<\/p>\n
Kuntoro, who served as the director general of mining when the
\nBusang saga surfaced, said yesterday he believed there was gold
\nat Busang.<\/p>\n
\"It's mysterious. Busang must contain gold in view of the fact
\nthat (many) people (make a living by) traditional panning for
\ngold there. The question is, can the area's gold reserve make an
\neconomic mining operation?\" Kuntoro said.<\/p>\n
Kuntoro said the Busang scandal had exerted an impact on the
\ncountry's mining industry.<\/p>\n
Exploration activities in Indonesia by junior mining
\ncompanies, mostly from Canada, subsequently decreased due the
\ntighter rules set by the Canadian Stock Exchange for them to
\nraise funds.<\/p>\n
But operations of big mining companies, who do not rely on
\nfunds from stock exchanges, remain unaffected, Kuntoro said.<\/p>\n
Kuntoro said the scandal caused Indonesia to drop from its
\nsixth in 1996 to the eighth last year among the world's favored
\ndestinations for mineral investments, according to Australia's
\nMining Monthly.<\/p>\n
Ranked above it, in descending order, are the United States,
\nCanada, Chile, Australia, Argentina, Malaysia and Brazil.<\/p>\n
Following Indonesia are Mexico, Zimbabwe, Peru, Ghana, South
\nAfrica, Tanzania, China, the Philippines, Vietnam, Russia, India
\nand Papua New Guinea. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/busang-still-draws-investors-says-minister-1447893297",
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"sponsor_url": "https:\/\/okusiassociates.com"
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