Placer Dome sends proposal to President

JAKARTA (JP): Canadian mining giant Placer Dome Inc. confirmed yesterday it had sent a letter to President Soeharto offering the Indonesian government and future local partners up to 40 percent of the stakes in Busang gold mine in East Kalimantan.

In the letter, Placer Dome president and CEO John M. Willson asked to meet the President.

Willson said yesterday that he was still waiting for a reply.

Placer Dome offered Indonesia -- the Indonesian government as well as Indonesian partners -- up to 40 percent ownership of the stakes in what Willson called "the world's largest gold find in 500 years".

The remaining 60 percent would be owned equally by Placer Dome and Canadian mining company Bre-X Minerals Ltd, which found the Busang deposit which is believed to contain 57 million ounces of gold.

Placer Dome, he said, was negotiating to merge with Bre-X, which could be realized if the Indonesian government granted the project to Placer Dome.

Another Canadian gold mining giant Barrick Gold Corp, in league with the President's daughter Siti Hardiyanti Rukmana, is also bidding for the gold mine. It proposes to take a 67.5 percent shareholding and give Bre-X and its local partners, PT Askatindo Karya Mineral and PT Amsya Lina, a 22.5 percent stake and the Indonesian government 10 percent.

Placer Dome's general manger for Asian operations, John E. Loney, said that Barrick was the largest gold mining company in North America with market capitalization of Can$8.9 billion, followed by Placer Dome with Can$7 billion.

Willson said Placer Dome considered it was fair to offer Indonesia a 40 percent shareholding.

He said that, based on its mining experience in tropical countries such as Papua New Guinea, the Philippines and Chile, Placer Dome was aware that it should share the mine's benefits with local people to make it successful.

Informed sources here speculate that Placer Dome will team up with timber tycoon Muhammad "Bob" Hasan, who recently bought 50 percent of the shares of Askatindo Karya Mineral, to bid for the project.

Placer Dome recently hired the public relations company Mercurindo, which is owned by Bob Hasan.

Willson admitted that he had met Bob Hasan, in his capacity as president of Nusamba group, but denied they would join to bid for the project.

"I think as far as I know Bob Hasan is an excellent man, a very clever businessman. And he is a good friend of the President and above all he is a very straight man," Willson said when asked if Bob Hasan would become Placer Dome's partner in the Busang gold mine. (jsk)