Antam eyeing N. Sumatra gold mine

JSX-listed state nickel and gold miner PT Aneka Tambang or Antam is in the process of acquiring a new gold mine in North Sumatra, said a senior executive with the company Monday.

The mine which hasn't started production has potential reserves of 90 tons of gold, Antam's President Director Dedi Aditya Sumanagara told Dow Jones Newswires in an interview.

Dedi declined to give details on the mine's location or the value of the planned acquisition.

"We are still in an early stage of discussion," he said.

There were only two gold projects currently ongoing in North Sumatra, with the one most ready for development is Martabe gold project, in which US gold miner Newmont Mining Corp. holds 90 percent interest. Newmont had recently disclosed its attention to sell the mine due to uneconomic reserves for the company of its size.

Newmont Pacific Nusantara, a unit of Newmont declined to confirm or deny whether it was in talks with Antam. "Newmont is working with the government to find a partner that will complete feasibility study and build the operations (of Martabe)as soon as possible. In selecting the company, Newmont and the government will ensure the selected developer has the financial and technical ability and proven track record to ensure the mine is developed and operted in responsible manner," Noke Kiroyan, president director of Newmont Pacific Nusantara said in a statement.

Pre-feasibility study on the gold project conducted by previous owner Normany Mining in 2002 revealed that high returns from the project could be achieved from a heap or dump leach operation for a low entry capital of approximately US$30 million and operating cost of approximately US$105/oz, with an indicative average annual production of 150,000ozs. (godang)