Weda Bay temporarily suspends Halmahera nickel project

Canadian based nickel explorer listed in Toronto Stock Exchange Weda Bay Minerals Inc. has decided to suspend work temporarily on its nickel and cobalt project on Halmahera Island, North Maluku,

This action, said the company on Friday, was prompted by OM Group, Inc., a 19.9 percent shareholder in Weda Bay reluctance to continue to advance funds for the Halmahera project until financing prospects improve.

Weda Bay said OMG had communicated concerns about business uncertainty in Indonesia and believed that it would be difficult to raise project financing on acceptable terms.

Weda Bay has, as a result, decided to reduce activities on the Halmahera project to essential care and maintenance and ongoing metallurgical testwork until impediments to project financing are reduced to manageable levels.

?Weda Bay will at the same time examine incorporating atmospheric leaching of available high grade saprolitic ore as an additional processing step that could further improve project economics and justify a smaller initial phase,? said the company in a statement.

Weda Bay said OMG had indicated that it will provide funding that will allowthe company to meet its related financial obligations.

Weda Bay holds 90 percent of interest in PT Weda Bay Nickel, which runs the project while publicly listed state miner PT Aneka Tambang Tbk. (Antam) holds the remaining 10 percent. (alex)