32 companies withdraw COW applications

JAKARTA (JP): Thirty-two mining companies have withdrawn their applications for the seventh generation contracts of work which are being deliberated at the House of Representatives, an official said.

Director General of Mining at the Ministry of Mines and Energy Adjat Sudradjat said in a hearing with House Commission VI for mining, energy and manpower Tuesday that 11 of the 32 companies had withdrawn their applications because they had not found a prospective mineral resource on the concession area they applied for.

The regulation allows contractors to explore the concession areas they apply for once they gain preliminary approval from the Ministry of Mines and Energy.

Adjat said 21 of the 31 companies withdrew their applications, but they still wanted the government to process their applications for the next generation.

Adjat said some investors were presently discouraged to develop gold mining projects due to decreasing gold prices on the international market.

They also faced difficulties raising money on the stock market in Canada to finance Indonesian mining projects.

"But I hope the mood to invest in Indonesian mining projects on the country's (Canada) stock exchange will turn bullish once the House recommends the (seventh generation mining) projects," Adjat said.

The commission is currently examining the draft COWs to make a recommendation as required by law.

The House deliberation is the final step before the COWs are passed to the President for final approval.

The Ministry of Mines and Energy submitted to the commission 164 seventh generation mineral COWs and 12 third generation coal COWs in July this year. It delivered another seventh generation mineral COWs in August, bringing the total seventh generation mineral COWs to 171.

Adjat said investors which had completely withdrawn their COW applications included Barrick Gold Corporation (over one concession area in Irian Jaya), Yamana Resources Inc. (three concession areas in East Kalimantan), Chance Mining and Exploration Co. Ltd. (four concession areas in West Kalimantan and Central Kalimantan, a consortium of Terrex Resources Ltd. and Cove Mining Ltd (one concession area in West Kalimantan) and Atlanta Gold Corporation (one concession area in East Kalimantan).

All the companies are from Canada except Terrex Resources Ltd. and Cove Mining Ltd., which are from Australia.

The companies which wanted their applications to be processed for the next generation included Corsair Exploration Inc., Olympic Resources Ltd., International Silver Ridge Resources Inc., Penny Tech Inc., Jonpol Exploration, Stirrup Creek Gold Ltd., Canada's Ivory Oils & Minerals Ltd. and Northpoint resources Ltd. All of them are Canadian firms.

Commission member Muhsin Bafadal of the United Development Party said yesterday the deliberations on the draft COWs at the commission were not yet completed.

But he was optimistic the commission would finalize the deliberations before the current House ended its term by the end of the month.

"I think the discussion will run smoothly because the government is willing to listen to our opinion regarding the draft COWs," said Muhsin. (jsk)