President delays contract of work for Busang mine<\/p>\n
JAKARTA (JP): President Soeharto has delayed the issue of the
\ncontracts of work (COW) for Bre-X and its partners to develop its
\nBusang gold mine in Kalimantan, the minister of mines and energy,
\nI.B. Sudjana, said yesterday.<\/p>\n
Sudjana said the President would not make a decision on Bre-
\nX's applications until an independent team assessing the Busang's
\ngold reserves had finished.<\/p>\n
Bre-X is one of several foreign and local companies applying
\nfor the sixth generation of COWs to develop mineral deposits in
\nIndonesia.<\/p>\n
There are 70 applications for the COWs. Two are from Bre-X and
\nits partners in Busang II and III.<\/p>\n
Sudjana said the President approved all applications, except
\nthose from Bre-X, two weeks a ago.<\/p>\n
The House of Representatives and the Investment Coordinating
\nBoard have approved all the applications but the President has to
\ngive the final approval.<\/p>\n
Bre-X has formed a joint venture with Askatindo and Freeport
\nIndonesia, the subsidiary of U.S. mining giant Freeport McMoran-
\nCopper and Gold Inc to develop Busang II and III.<\/p>\n
The Busang gold fields first made headlines last year after
\nseveral giant mining companies -- including Canadian firms
\nBarrick Gold Corp and Placer Dome Inc -- and several prominent
\nIndonesians battled for a stake in the exploration and
\ndevelopment of the mine.<\/p>\n
But Bre-X and Askatindo chose Freeport as a partner.<\/p>\n
The Busang gold mine made headlines again last month because
\nof conflicting reports about how much gold was there.<\/p>\n
Bre-X had said Busang contained 70.9 million ounces of gold
\nbut Freeport later said the gold reserves were insignificant.<\/p>\n
An independent team in Australia is now assessing how much
\ngold is in Busang.<\/p>\n
\"If the results show good deposits, Bre-X's applications will
\nprobably be included in the sixth generation of contracts of
\nwork. If not, let's just see,\" Sudjana said.<\/p>\n
The sixth generation of COWs were sent to the President about
\nsix months but president delayed approving them because of
\nBusang.<\/p>\n
The delay has upset COW applicants, especially Canadian
\ninvestors who make up 80 percent of them.<\/p>\n
The Canadian government has expressed its concern over the
\ndelay to the minister of industry and trade, Tunky Ariwibowo,
\nduring a visit to Indonesia.<\/p>\n
Sudjana said all 68 COWs would be presented simultaneously in
\na ceremony but did not say when this would happen.<\/p>\n
He said the governors of provinces where mining projects were
\nwould be invited to the ceremony so governors and investors could
\nmeet.<\/p>\n
\"In the past, there was no such ceremony where governors and
\ninvestors could meet each other before they started developing
\nthe projects,\" the minister said.<\/p>\n
Sudjana has so far received 176 applications the seventh
\ngeneration of COWs.<\/p>\n
Meanwhile, stockbroker Williams de Broe said in its latest
\nNorth American Miner that the Busang property in Kalimantan,
\nIndonesia, probably had some gold, but might not warrant the
\ndevelopment of a mine.<\/p>\n
If there was a deposit, it was doubtful whether it would
\ncommand a market valuation much higher than the current C$700
\nmillion, Williams de Broe added, as quoted by Reuter in London
\nyesterday.<\/p>\n
According to the ministry of mines and energy, foreign firms
\nand joint ventures have submitted 176 applications for seventh
\ngeneration of COWs.<\/p>\n
\"The applications are ready to be discussed with the House of
\nRepresentatives and the Investment Coordinating Board,\" Simon F.
\nSembiring, an official of the ministry said over the weekend.<\/p>\n
He said most of the applications were for gold mining
\nprojects.<\/p>\n
Between 70-80 percent of the investors are from Canada,
\nincluding the giant mining company Barrick Gold Corp. and Placer
\nDome Inc. (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/president-delays-contract-of-work-for-busang-mine-1447893297",
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