Newmont to close Minahasa gold mine

Newmont to close Minahasa gold mine

JAKARTA (JP): PT Newmont Minahasa Raya (NMR) plans to close
its gold mine in Ratatotok, Minahasa regency, North Sulawesi, in
2003, or 13 years earlier than initially planned, because of the
depletion of gold deposits, a company executive said on Thursday.

NMR spokesman Tri Harjono said in Manado on Thursday the
company, which has a license to operate the mine until 2016,
would close the mine because most of the available gold deposits
were no longer viable for a long-term operation.

"The mine closure will leave 375 workers unemployed, but NMR
has prepared a total US$4.45 million to compensate them," he was
quoted as saying by Antara.

The compensation will be based on international standards and
the payments will begin at the end of this year, Tri said.

He said another NMR gold mine in Lobongan, which is located
near the Ratatotok mine, still had large gold deposits, but due
to numerous problems, such as illegal mining by locals, the
company also decided to close this mine in 2003.

Although the company has operated in the area for several
years, it has yet to reach the break-even point.

"But we hope we can realize a profit of about $413 million
this year," Tri said, adding that NMR, a subsidiary of the
Colorado-based Newmont Corporation, had spent $234 million
constructing the infrastructure at the Minahasa mine.

Newmont started production at the Minahasa site in 1996.

Besides the Minahasa site, Newmont also operates a massive
copper and gold mine in Batu Hijau, Sumbawa, West Nusa Tenggara.

The Batu Hijau mine, which started production in late 1999, is
owned by Newmont in partnership with Japanese firm Sumitomo
Corporation and an Indonesian partner. (05)