OZ Minerals to sell part of stake at gold project to local govts

Australian mining firm OZ Minerals reported on Thursday it had signed a Memorandum of Intent (MoI) to sell 5 percent stake in Martabe gold project in North Sumatra to local governments of North Sumatra.

The company did not give further detail.

The company had also signed deal earlier with state miner PT.Aneka Tambang to sell 10 percent interest in the Martabe project, with the potential to sell a further 15 percent subject to certain conditions.

The company reported that development of the project is underway following the receipt of final regulatory approvals from Department of Energy and Mineral Resources in April 2008. The first construction contractor has moved to site and earth works have now commenced.

OZ Minerals is a new company created by the merger of Zinifex and Oxiana.

Martabe project is expected to start production late 2009 with annual output of 200,000 ox of gold and 2 million oz of silver. Estimated capital cost to develop the project is US$310 million. (denny)