Aneka Tambang 3Q report: exploration and development activities

EXPLORATION

In 3Q00, Antam's exploration focused on lateritic nickel in the Buli area of Halmahera Island. As well, Antam carried out regional and semi detailed exploration in areas of Java, Bengkulu, West Sumatra and South Sulawesi. Exploration results at Antam's Pongkor Mine returned some promising results. Exploration expenditure is in Rupiah; the equivalent US Dollar amount is included in parenthesis for illustrative purposes only.

NICKEL

Southeast Sulawesi

In Southeast Sulawesi, Antam continued during 3Q00 its exploration of 7 KP's covering an area of 75,752 ha. Drilling at the Bahubulu and Maniang prospects used a grid spacing of 50m x 50m to 200m x 200m. A total of 608 drill holes of 6461.4 m in depth were bore in 3Q00. A further drilling is still planned for the Bahubulu and Maniang prospects.

A total amount of Rp. 1.32 billion as on 30/9/00 was spent exploring these tenements in 3Q00. By comparison, in 2Q00 Rp. 2.2 billion (USD $252,149 as on 30/6/00) was spent on exploration at Southeast Sulawesi.

Buli

The Buli tenement, which includes Antam's operation at Gee Island, is situated on Halmahera Island, and covers an area of 39,040 ha. The tenement is part of an active exploration program on Halmahera covering 97,520 ha.

A total of 15,358m of in fill drilling at 861 locations on spacing of 25m x 25m to 500m x 500m was performed in 3Q00 with intent of increasing the mineral resources estimation. Further detailed drilling will be continued in the next quarter.

Total expenditure of these activities in 3Q00 was Rp. 3.8 billion. This compares with Rp. 2.9 billion (USD $332,378 as on 30/6/00) spent during the previous quarter.

GOLD

Mt. Liman

Mt. Liman is located on East Java and covers an area of 13,520 ha. Detailed geological mapping, trenching, rock sampling and geophysical surveying were conducted in 3Q00 to follow up previous evidence of alterations and mineralization. The mineralization was predicted still continue to the depth. A detailed geological mapping and scout drilling will be conducted in the next program.

A Total of Rp. 173 million was spent at Mt Liman in 3Q00. This is larger than the Rp. 118.74 million (USD $13,609 as on 30/6/00) spent during 2Q00.

Latupa region

Latupa tenement covering an area of 14,750 ha is located in South Sulawesi. Detailed geological mapping and drilling in took place at two holes at Mangkaluku to detect acontinuation of the surface mineralization to the depth.

The summary of significant intercepts at the Mangkaluku prospect is shown below:

In this 3Q00, a detailed geological mapping was also conducted at Babak prospect to follow up the previous indication of porphyry copper mineralization style. The detailed geological mapping will continue in this area in the next quarter.

Total expenditure of exploration in 3Q00 was Rp. 546.28 million. This compares with Rp. 979.95 million (USD $112,315 as on 30/6/00) spent during the previous quarter.

Pongkor

The exploration area is situated in Antam's Pongkor Mine. In 3Q00, Detailed geological mapping and drilling in took place at 6 holes at Gudang Handak to detect a continuation of the quartz vein mineralization.

The summary of significant intercepts at the Gudang Handak prospect is shown below:

Total expenditure of exploration in 3Q00 was Rp. 932.72 million.

BAUXITE

Tayan prospect

The Tayan Bauxite prospect covering an area of 36,410 ha is located in West Kalimantan. In 3Q00, detailed test pitting using a spacing of 25m x 25m continued to increase the classification of the tenement's mineral resources. A total of 22 test pits of 122.3m in depth were constructed and 24 samples were collected. The samples were prepared and sent to Antam's laboratory in Jakarta for assaying. Water level measuring for the jetty plan continued in 3Q00.

The total quarterly expenditure for these activities was Rp. 391.72 million. By comparison, in 2Q00 Rp. 207.94 million (USD $23,832 as on 30/6/00) was spent on exploration at Tayan.

DEVELOPMENT (Corporate and Mine)

FeNi III

The Parallel Tender (which was issued on 1 May 2000) is structured to facilitate Antam maintaining the status of Mitsui & Co as the Preferred Bidder from the original tender of 1998. The focus of the activities of this Preferred Bidder during this retender was continue the securing of the related Export Credit Agencies (ECA's) support for their existing EPC offer. The new tenderer for the Parallel Tender have undertaken to achieve the submission of an EPC offer, which shall include the necessary comprehensive insurance coverage from the respective ECA. The Tender Closing date was 1 August 2000.

Tessag INA AG from Germany became the successful bidder after participating in the comprehensive pre-qualification process of the Parallel Tender. The Board of Directors was considering the two proposals following the tender closing date at the end of 3Q00.

Antam has evaluated the EPC offers through an independent competent third party, pursuant to a transparent process, the valuation of which was submitted at the end of September. Therefore the Company's expects to appoint the EPC Contractor with the most competitive offer at the end of 2000, targeting the Project's financial closure and commencement of construction by late first quarter of 2001.

Tayan

Detailed exploration (grid 25m x 25m) of 1,007 test pits was conducted in July 2000. The geotechnical survey (including permeability test) for the red mud dumping area plan of Dam-3 had was finished in June 2000 with total of 13 drill holes and 158.35 metres depth.

On September 2000 a combined survey on Kapuas River was finished. The surveys included measuring stream velocity, high water level fluctuations, suspending river bed load, and river's tide to help choose the best jetty location.

The Mining Permit (KP) status of the project was considered for upgrading from exploration (KP Eksplorasi) to exploitation (KP Eksploitasi) beginning on 5 July 2000 in combination with an application for a transportation permit (KP Pengangkutan) and a marketing permit (KP Penjualan).

As well at the end of September 2000, a social study of the local community surrounding the project was finished. The study was prepared using the guidelines of the World Bank/IFC to complete the environmental documentation for the project.

DEVELOPMENT - JV

Dairi Prima

Dairi Prima is a JV between Antam (20% with loan carried 10% and option thorough 10%) and Herald (80%). Dairi Prima is sited on Bukit Barisan Highland, between North Sumatra and West Sumatra Province.

PT Galuh Cempaka

Galuh Cempaka is a JV between Antam (20% with option 10%) and Ashton MMC (80%), located on Banjar Regency (South Kalimantan).

Galuh Cempaka operates an alluvial diamond project that encompasses two palaeochannels, Danau Seran and Cempaka within swampy ground, which enables mining by bucketline dredge. Commissioning of the bucketline dredge and processing facility continued during third quarter after a number of modifications were made.

Since July 2000, the operations of the bucketline dredge focused on moving into the northern arm of Danau Seran palaeochannel where some fine grained upper alluvium was processed. A small number of gem quality diamonds have been recovered during the initial commissioning work.

At the end of 2000 and during 2001 the project economics will be evaluated, prior to a decision to continue with further commissioning.

PT Weda Bay Nickel

PT Weda Bay Nickel is a JV between Antam (10% with option to 15%) and Weda Bay (90%) a Canadian company. The company focused on their nickel-cobalt project in southern Halmahera Island (North Maluku) under a 7th generation of CoW.

The company continued a feasibility study in support of project financing during 3Q00 and had a total expenditure of US$ 866,731. The company's activities were as follows:

The Santa Monica resource estimate, inferred from the result of 63 drill holes at 400 m x 400 m spacings, totaled 75.7 million dry tonnes (Mdt) at 1.38% Ni and 0.12 % Co at 1.0% Ni or 0.1 % cutoff grade.

With this total Santa Monica resource, a coherent zone exhibiting thicker than average laterite profiles and higher than average nickel grades was delineated. This region covers less than 50% of the total Santa Monica resource area, but contain an estimated 75% of the inferred resource tonnage. The inferred resource in this region is estimated to be 56.4 million dry tonnes at 1.45 % Ni and 0.11 % Co.

The Big Kahuna inferred resources after this review and re-estimation showed an increase from 31.9 Mdt to 40.4 Mdt at 1.32% Ni and 0.17% Co at a 1.0% Ni or 0.1% Co cutoff grade.

The establishment of the SM inferred resources and the upgrading of Big Kahuna inferred resources led to an updated global resource figure, which was reported to the Toronto Stock Exchange in July. This figure currently stands at 202.3 Mdt at 1.37% Ni and 0.12% Co at a 1.0% Ni or 0.1% Co grade cutoff and represents a 75% increase in tonnage to that previously reported.

Preliminary metallurgical tests on Santa Monica laterites indicate that they behave within expected limits in terms of thickening, leaching and settling.

PT Sorikmas Mining

PT Sorikmas Mining (SM) is a joint venture PMA company between Aberfoyle Pungkut Investments Pte. Ltd. (API-75%) and PT Aneka Tambang (25%). API is owned 100% by Perth based Western Metals Resources Limited, [named Aberfoyle Resources Limited prior to the takeover in September 1998 of Aberfoyle Limited by Western Metals Limited].

During the September quarter, activity included mapping and sampling in catchment areas peripheral to known sediment-hosted gold mineralisation at Sihayo, completion of regional geochemical sampling, and field checking of areas under consideration for relinquishment. Substantial zones of clay-pyrite and silica alteration with minor quartz veining were discovered to the south of Sihayo (assay maxima: gold 0.69 g/t, silver 823 g/t).

Expenditure by PT Sorikmas Mining for the quarter was US$65,386. (Alex)