Australia?s Straits Resources concentrates more on Mt Muro operations
Tuesday, December 16 2003 - 02:45 AM WIB
The company?s chief executive Milan Jerkovic believes that most of the investment upside for Straits is at Mt Muro, where a decision to reopen the former gold mine could be taken in mid-2004.
Straits spent around A$5 million this calendar year on exploration at Mt Muro, with a similar amount to be spent in the first half of next year ahead of a go-ahead. Suspended in June last year because of falling reserves and illegal mining activities, Mt Muro will be relaunched at a cost of around $A20 million, Jerkovic said.
The initial target is to produce 100,000 ounces per year over a timeframe of three to five years, he added. Jerkovic predicts that Straits will overcome the illicit mining by locals that dogged previous operator Aurora Gold.
"Our approach is very different to Aurora we have a high level of direct engagement at the local level," he said.
In April 2003, Straits entered into a letter agreement with another Australian company Aurora Gold, which latter merged with Abelle Limited, to acquire a 70 percent interest in a joint venture established to explore, and if successful, to redevelop the area.
Mt. Muro mine had ceased production in June 2002, but still had upside exploration potential. Over its 8-year mine life, the mine had produced approximately 1.7 million gold equivalent ounces. Straits agreed to take over the mine by spending minimum of US$1 million in exploration and to fund recommencement of operations.
Meanwhile, Jerkovic also believes that Straits' long-term ownership of Sebuku coal mine, located in South Kalimantan, provides "credibility" for the company among local authorities and landowners.
The Sebuku coalmine is an open-cut truck and shovel operation located on Sebuku Island in South Kalimantan. The company operates the mine through its 80 percent-owned subsidiary PT Bahari Cakrawala Sebuku.
Straits produced around 2.065 million tons of coal from Sebuku in 2002. (*)