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Letter-clarification
PT MSM clarifies
JP/7/let

PT MSM clarifies

PT Meares Soputan Mining (PT MSM) wishes to clarify statements
made within an article in The Jakarta Post on Monday, Dec. 5, as
in some respects we suggest these are incorrect. PT MSM met
openly and in the spirit of co-operation with various press
representatives on Friday, Dec. 2, at their request and all
statements to the press were recorded and witnessed.

PT MSM wishes to provide a correction to your article as
follows:

1. This news article may be interpreted to link PT MSM to the
NMR -- Buyat case which is still in process within the Indonesian
court system and hence this is inappropriate.

We wish to clarify that PT MSM has not commenced full
constr0uction of the Toka Tindung Gold project and has no
tailings discharge at this time. The Toka Tindung tailings will
comply with Indonesian and international environmental standards
and is in fact very similar in character to the sediments on the
sea floor. PT MSM has conducted recent ecological studies in the
area;

2. PT MSM has not dismissed community fears and or government
concerns at any time. In fact the Company has socialized the
approach for developing the project to the community and
government as stakeholders and will continue with this proactive
approach;

3. A representative group of community from villages in the
area of proposed STD also visited Ministers and government
representatives last week. They are supporting the projects
development as shown in the attached documents;

4. PT MSM will contribute around US$60 million in expenditure
during construction of the Toka Tindung Gold Project and over the
life of the project contributions in terms of tax, royalties,
work for contractors and support businesses, salaries and
community development programs are estimated at $200-250 million
over a six year period;

5. PT MSM has studied land based tailings and it is a similar
cost to STD over the life of the project. STD does provides the
best environmental solution to tailings disposal;

6. The discharge of tailings is located 10 kilometers from the
northern end of Lembeh in deep water and will have no effect on
the biodiversity in the Lembeh Strait or fishing in the area. In
fact the Company has several business development programs
supporting local fishing and fish from this area is supplied to
the mine site;

7. PT MSM has a valid Contract of Work and is working in
accordance with requirements of this agreement.

Various stakeholders in the local community and government
have been in communication with me today expressing their concern
at some of the incorrect statements regarding PT MSM in respect
to the Company's planned activities.

PETER BROWN
General Manager/Director
PT Meares Soputan Mining/PT Tambang Tondano Nusajaya

Note: Thank you for the additional information.

--Editor