Fri, 05 Aug 1994

Newmont to start its gold mine construction

JAKARTA (JP): PT Newmont Minahasa Raya, a subsidiary of Newmont Gold Co. of the United States, has received approval from its partners and local administration to begin construction of a large gold mine in North Sulawesi.

Newmont Minahasa's president, John Dow, said in a statement made available to The Jakarta Post yesterday that the mining company had agreed to invest US$131 million in the Mesel gold project, which is located around 100 kilometers southwest of Manado, the capital of North Sulawesi.

Dow said the investment includes funds for the development of infrastructures such as a deep-water port, electrical power generation, water supply as well as housing for local workers.

It is estimated that the project will produce an estimate of 1.8 million ounces of gold at an average operating cost of some $150 per ounce over a 13-year period.

Production is scheduled for the first quarter of 1996 at an initial annual rate of 140,000 ounces.

Dow said that a substantial investment will be made to control air and water quality and to live up to Newmont minahasa's pledge to operate under the strictest U.S. environmental standards wherever it mines.

Newmont Minahasa is 80 percent owned by Newmont Gold and 20 percent by the Jakarta-based PT Tanjung Serapung. Newmont Gold is owned by Newmont Mining Corporation which also operates five mines in Nevada, the United States, a joint venture operation in Peru and in Uzbekistan.

Dow said Newmont is currently evaluating a second Indonesian project in Batu Hijau on Sumbawa Island, which could come into production in 1998. (09)