Strike: Berau joint venture negotiations update

(19 November, 2010)--As Strike has previously announced, a new Mining Law came into force in Indonesia in January 2009. The new law and supplementary regulations issued over the following year created uncertainty with respect to Strike?s obligations to carry out certain aspects of mining operations and make payments to the Berau concession owner under the Co-operation Agreement between the owner and Strike.

The Cooperation Agreement requires Strike and the concession owner to enter good-faith negotiations to amend the agreement to ensure consistency with the new Law, whilst preserving the economic substance of the original agreement. In performance of that requirement Strike has put a number of proposals to the concession owner in good-faith.

Strike has devoted considerable efforts to these negotiations over the past year. The position adopted by the concession owner in negotiations makes further progress uncertain at this time. Consequently Strike is considering all options, including dispute resolution proceedings. Strike will keep the market informed of material developments. (ends)