Govt wants bigger local Busang stake
Govt wants bigger local Busang stake
JAKARTA (JP): The government is giving local companies the
widest possible opportunity to own big stakes in the huge Busang
gold mine in East Kalimantan, Minister of Mines and Energy I.B.
Sudjana said yesterday.
"Therefore, the government encourages businesspeople such as
Mohammad (Bob) Hasan to join the battle for ownership of the
Busang gold project," Sudjana said in North Sumatra.
Sudjana was quoted by Antara as saying in Kisaran that the
government wanted to see a bigger national shareholding in the
gold project.
"I have sent letters to the two Canadian companies asking them
to renegotiate the shareholding structure with their Indonesian
partners," he added.
Sudjana was replying to reporters' questions about Bob's entry
into the battle for the gold mine through PT Nusantara Ampera
Bhakti, a company controlled by three foundations chaired by
President Soeharto.
He said the government had asked the two Canadian firms --
Barrick Gold Corp. and Bre-X Minerals Ltd -- to accommodate the
aspirations of their local partners as much as possible.
The Busang gold project raised controversy last October after
Bre-X teamed up with President Soeharto's eldest son Sigit
Harjojudanto and Barrick teamed up with Sigit's sister Mrs. Siti
Hardianti Rukmana in a bid to speed up approvals to develop the
mine.
"I don't want Indonesia losing out (in the dispute)," Sudjana
added.
The government confirmed last month that Bre-X and Barrick had
agreed on a 25 percent-75 percent split of the Busang gold
venture. They also agreed to provide a 10 percent stake to the
Indonesian government.
However, Bre-X has been disputing with its local partners, PT
Krueng Gasui, which owns an undisputed 10 percent of the first of
the three Busang delineated exploration zones, and PT Askatindo
Karya Mineral, which owns a 10 percent interest in each of the
other two zones.
In a surprise move, Syakerani of PT Askatindo reportedly sold
50 percent of his shares in the company to timber baron Bob
Hasan, a politically-well-connected businessman.
Sudjana confirmed yesterday that the government would let
local companies enter the Canadian joint venture to increase
Indonesian interests in the Busang mine which reportedly holds
more than 57 million ounces of gold.
He stressed that the opportunities were not only open to Bob
Hasan but also to other Indonesian businessmen interested in
entering the massive Busang gold deposit.
On Tuesday, Placer Dome Inc., another Canadian gold miner,
offered to merge with Bre-X, which found the deposit, to expedite
the development of the Busang gold reserves.
Placer Dome said its proposal provided for significant
Indonesian ownership of the gold mine as well as an opportunity
for Bre-X shareholders to gain while continuing their
participation in Busang.
Sudjana said that he would study Placer Dome's proposal which
promised 40 percent Indonesian ownership.
Sudjana confirmed yesterday the government would not increase
its stake in the joint venture because of financial constraints.
But it would give an opportunity to local enterprises to take a
much bigger stake in the gold venture. (rid/vin)