BHP Billiton quits nickel JV agreement with Antam

IDX-listed mining firm PT Antam Tbk announced on Thursday that it has received a letter from Australian resources giant BHP Billiton to end the conditional agreement to develop nickel laterite resources in Buli area, North Maluku.

?BHP Billiton cites the termination is due to the lack of an identified business case for BHP Billiton after their assessment, and the requirement of the approval of Contract of Work for the nickel development in Buli resources area by 31 October 2008, which has not been achieved,? Antam said in statement.

Antam has a contingency plan in which Antam may utilize the pyrometallurgy technology to develop the nickel resources area of Buli. Antam currently utilizes the pyrometallurgy technology to produce ferronickel at its three ferronickel smelters in Pomalaa, Southeast Sulawesi, it said.

In June 2008, Antam signed a Joint Venture Agreement with BHP Billiton to develop nickel laterite resources in N.Maluku. The joint venture ownership is envisioned as 50:50 between Antam and BHP Billion.

Although nickel development is part of Antam?s growth strategy, currently the main focus of Antam?s management is to complete the financial close of the Tayan Chemical Grade Alumina project. Antam expects to achieve the financial close of the Tayan project in 2009. Antam is also focusing on cost reduction program to remain competitive in the current global mining climate, the company added. (denny)