BHP proceeds with Gag island nickel project
BHP proceeds with Gag island nickel project
JAKARTA (JP): Nickel company BHP Asia Pacific Nickel Pte Ltd,
a subsidiary of Australia's Broken Hill Proprietary (BHP), is
proceeding with its plan to develop nickel deposits on Gag
Island, Irian Jaya, despite the country's dire economic straits.
BHP Indonesia president Harriet Richards told The Jakarta Post
on Monday that the company, in a partnership with publicly listed
general mining company PT Aneka Tambang, was exploring for more
nickel deposits and carrying out feasibility studies on Gag and
adjacent islands.
"The feasibility study include studies of the environment and
the social lives of several tribes in the area," she said on the
sidelines of the ceremony to award two contracts of work (COW) to
the company's subsidiaries for the development of coal deposits
in East Kalimantan and Central Kalimantan.
"The study may take two years."
BHP has a 90 percent share in the Gag project, with the
remaining shares held by Aneka Tambang.
She said BHP and Aneka Tambang were developing new technology
in BHP's research and development office in San Francisco. It was
expected to enable them to process nickel ore on the islands at a
minimum cost amid growing competition among the world's nickel
producers.
She said the company was conducting trials of the technology
on the island to determine its capability, as well as its social
and environmental impacts on Gag and surrounding areas.
"There are still many technical issues to be studied before we
apply the technology."
She added that both firms invested "a huge amount of money" to
develop the technology.
Aneka Tambang's president Dedy Aditya Sumanegara said last
year Gag and the adjacent islands were believed to contain 190
million tons of nickel, making it the world's third largest
nickel deposit, and a significant amount of cobalt.
Aneka Tambang and BHP planned to produce 40,000 tons nickel
and 3,600 tons of cobalt per year, he said.
Richards said the results of the exploration carried out by
the company showed the islands may contain "larger deposits of
nickel than the initial estimation".
Richards said the Gag nickel project may become "a
significantly large nickel mine" lasting up to 25 years.
BHP has been operating in Indonesia for 25 years in various
sectors, including mining, steel, information technology and
transportation.
Its subsidiaries, PT Pari Coal and PT Sumber Barito Coal, were
awarded on Monday two COWs for the development of coal deposit on
respectively a 98,910-hectare contract area in East Kalimantan
and 100,300-hectare contract area in Central Kalimantan. (jsk)