PT BSM halts gold exploration in South Sumatra

PT Barisan Sumatera Mining (BSM), a subsidiary of an Australian company, has decided to stop its gold exploration activities in Muara regency, South Sumatra due to the lack of gold deposits and land clearance problem, local newspaper Sumatera Ekspress reported on Friday.

The company?s public relations manager Deddi Kurniawan said in Lubuk Linggau on Thursday that the exploration activities in the Muara regency had been stopped for almost six months and the company did not have any plan to return back to the area.

He said that the exploration activities in the company?s concession area in Kidak island in the Rawas Ulu regency were halted due to the lack of gold deposits, "In addition, the high land compensation payment demanded by the local residents has also discouraged the company," he said, adding that the compensation payment asked by locals reached Rp 10 million per hectare.

According to Deddi, the company has spent billions of rupiah to finance exploration activities on at least 10 spots in the area and to build access roads to the mining area. (*)