Governor rejects gold project in Central Sulawesi

Governor of Central Sulawesi Aminuddin Ponulele insisted that he would not allow PT Citra Palu Mineral to continue its gold project in Paboya, East Palu district, Tempo daily reported Monday.

The governor said Saturday that from the beginning, he was opposed to the gold project because the chemicals to be used by the mining company would damage the local people?s health and the environment.

He said he would provide any licenses for the company to exploration or exploitation activities in the area.

The planned gold project has caused a protracted controversy, as it is located in the protected forests, which is under the Forestry Law No. 14/1999 out of bounds for open-pit mining activities. The problem is that the gold project started prior to the issuance of the law.

A senior official at the directorate general of geology and mineral resources, R, Sukhyar told Petromindo.Com last month that a special team formed by the government has decided to allow Citra Palu to continue the gold project.

The official said the company was now only required to obtain approval from the Palu mayoralty administration.

It remains unclear if Citral Palu will finally be able to gain the approval given the strong opposition of the governor to the project.

Citra Palu Minerals is 90 percent owned by Anglo-Australian mining giant Rio Tinto. Another 10 percent owned by local firm PT Arlia Karyamaska.

In March 2001, Newcrest agreed to acquire the entire shares of Citra Palu on condition that it is allowed to explore some 500 hectares of land which was now located in the Poboya forest park.

Citra Palu was granted sixth generation Contract of Work (CoW) in 1997, which gives rights to for the company to explore for gold in Central Sulawesi.(*)