Mill City cancels plan to acquire North East Tanjung Block

By Romel S. Gurky

TSX-listed Mill City Gold Corp announced Tuesday that it will not be proceeding with an earlier agreement to purchase up to a 75 percent interest in the North East Tanjung Block, an onshore oil and gas concession located in West Kutai Regency, East Kalimantan.

?The vendor of the Indonesian project has been unable to raise the required funds to complete the reverse takeover,? the company said in a statement.

As previously reported in February of this year, Mill City signed a revised Letter of Intent (LoI) to purchase 75 interest in the block from PT Trimata Energi Investama (PTTEI).

PTTEI is an Indonesian company which owns 85 percent of the shares of PT Anugerah Trimata Kaltim Energi (PTATKE) that holds a 100 percent working interest in the project.

The North East Tanjung Block project covers an area approximately 5,453.27 square kilometers within the onshore Kutai Basin. Geologically, the project area is situated in the Western Kutai Basin, known as the Upper Kutai Basin, which is one of the most prolific petroleum basins within Indonesia.

Moreover, from a previous study on adjacent ground, the gas potential has been proven in the Mendung Well, within the onshore West Kutai.

Elsewhere, Mill City said that the management has determined it is in the best interest of the company and its shareholders to focus on the mining sector. Jim Brown, Mill City President, comments, "We are very encouraged by the quality of precious metals projects that are available to us at a small fraction of the capital previously invested in their development by other companies. Therefore, we are taking the steps necessary to acquire and finance one or more of these opportunities for our stakeholders."

Editing by Reiner Simanjuntak