NMR has yet to reach break even

Gold mining company PT Newmont Minahasa Raya (NMR) has yet to reach a break-even point although it has produced around 1 million troy ounce of gold since 1996, according to a company official.

"Until now (we) have not yet reached the break even point. There's no dividend yet for shareholders," David Sompie, NMR environmental superintendent, was quoted as saying by the Tempo Interaktif online.

NMR mines a gold mining site in Mesel Ratatotok, in Minahasa, North Sulawesi. The mining site is estimated to have some 1.9 million troy ounce of gold reserves.

David said that out of the worldwide investment of Newmont Mining Corporation, NMR only contributed 5 percent to the total gold production. Newmont is the world's second largest gold producer and the largest taxpayer in the U.S.

In Indonesia, in addition to the gold mining in Minahasa, Newmont also is exploiting gold in the Batu Hijau mining site in East Nusa Tenggara, with a gold reserves of 15 times greater than the one in Minahasa, David said.

But he added that the gold mining operation of NMR was one of the best in the world in terms of technology.

Meanwhile, NMR public relations officer Tri Harjono said that NMR would end its gold operation in 2003. Tri said that it was not yet clear on what to do to the ex-mining site.

"We are still waiting what the plans are (from the local administration). Also the role of Minahasa Raya Foundation which has received US$1.5 million from NMR," Tri said.

Tri said that over the next three years there would be around seven mining companies to end their operation at the same time, which would cause a lot of ex-mining workers to seek job.

In addition to the gold reserves in Mesel, NMR also has reserves in Lobong Minahasa and Bolaang Mongondow areas, which are part of the company's mining license.

Tri said that NMR management was still studying whether to mine the area because the gold reserves was relatively small. (*)