Straits Resources ups stake in C. Kalimantan gold project

Australian miner Straits Resources limited announced Wednesday it would increase ownership in Mouth Muro gold project in Central Kalimantan to 100 percent after South African miner Harmony Gold Mining agreed to sell its 30 percent stake at the project for US$3 million plus $500,000 after 100,000 ounces production.

Mount Muro is operated by PT.Indo Muro Kencana, holder of 3rd generation contract of work, which was signed in 1985. The project had commenced production in 1995 and ceased in 2002 after producing 1.3 million ounces of gold.

The company, however, managed to strike more discoveries in the project, with gold 433,000 ounces of gold equivalent by the end of September 2004.

With fully established infrastructure in place, the company plans to re-start production as soon as possible next year.

Straits said that currently the main focus of the project is to conduct detailed exploration program targeting two areas in the contract area called Juking Sopan and Tumbang Lahung in addition areas adjacent to the previously mined location to identify feed for the plant to recommence operations. (alex)