Hallmark buys RI mine

Hallmark buys RI mine

PERTH (Reuter): Hallmark Gold NL said it has entered into an
agreement with PT Arumbai Mangabekti (PAM) giving it the right to
acquire 55 percent of the Indonesian manganese miner's issued
capital for about US$1 million.

PAM is presently mining manganese on tenement KP 210 located
near the town of Reo, on the north west coast of Flores, in
Indonesia. Hallmark said it will appoint a manager of the Flores
manganese operation following the purchase.

Hallmark said the acquisition was based upon a number of
conditions including that there was sufficient manganese reserves
to sustain a viable mining and processing operation.

Prior to entering into the agreement, Hallmark said it
commissioned a geological consultant who visited the site and
reported the potential for a reserve base of 250,000 tons of good
quality manganese within five km of the coast.

Reserves to this magnitude should support a 50,000 to 60,000
tons per annum operation yielding pre-tax profits in the order of
US$2 million, it said.