N. Sulawesi governor rejects Archipelago's tailing disposal proposal

North Sulawesi governor Sinyo Sarundajang has refused to approve the tailing disposal proposal of UK-based miner Archipelago Resources Plc, forcing the firm to suspend all activities at its Toka Tindung gold project.

Director General of Mineral, Coal and Geothermal Resources at the Ministry of Energy and Mineral Resources Simon Sembiring confirmed and regretted the governor?s decision.

?We regretted it in view of the fact that the previous governor (AJ Sondakh) has approved the proposal,? Simon said.

Simon called on the North Sulawesi government to review its decision. ?I suggest the regional government form a new task force to study again the tailing disposal proposal and make a decision based on the result of study.?

The Toka Tindung has entered the construction phase and financing for the project is being finalized. Archipelago has brought in mining equipment to its mine site and a debt facility required for project development is currently being finalized by N.M. Rothschild & Sons (Australia) Limited.

The Toka Tindung gold project is believed to have a resource of 1.75 million ounces (ozs) of gold equivalent, of which at least 900,000 ozs will initially be extracted t by the open pit mining method. The project is targeted to produce 160,000 ozs per annum in the first six years with the production expected to start in mid 2006.

Archipelago has 85 percent shares in the project. (Godang)