West Wits Mining postpones gold project in Papua
Monday, November 25 2013 - 11:23 AM WIB
ASX-listed West Wits Mining Limited said on Monday it has been requested by local authorities to defer the commencement of operations at its gold mine in Paniai Regency in Papua for up to eight weeks whilst action is taken by the government authorities to gain control of the site and relocate the illegal mining population.
?The company?s planned commencement of the trial mining at the 81 Creek site has been impeded over the past two weeks by a number of local agitators. Clearly, the imminent commencement of lawful mining by the company is threatening the interests of specific persons who have been obtaining benefits from illegal operations which have supported a thriving trade in contraband goods and services at the site. All equipment has been in place in readiness to start an alluvial circuit,? the firm said in a statement.
Paniai Regent Hengki Kayame SH, MH (who was elected to office earlier this year), the head of the Paniai mining officde and the regency?s vice police chief vice recently declared at a public meeting on the site that it is the regency?s intention to solve the issues of illegal mining activities and the associated contraband activities. The regent has also publicly announced his full support for the company?s mining project which, he noted, as a lawful operation would generate royalties and other benefits for the local community.
As part of this policy initiative the regent has announced that a permanent police station will be constructed adjacent to the newly constructed airstrip at the site. This station will house officers who are to be deployed from several government departments. Furthermore, all aircraft entering the site will be searched for contraband goods and any gold found in the possession of persons without a mining permit will be confiscated. The company understands that the regent is in consultation with regional authorities including the governor of Papua Province and the provincial police chief regarding the implementation of this policy initiative, the firm said.
In order to minimize the risk of confrontation with agitators the regent has requested the company to defer commencement of operations for a period of six to eight weeks whilst these measures are put into effect. The company?s security staff will continue full operations on site during this hiatus period to protect our immovable assets and machinery.
?Operating costs in Indonesia will be substantially reduced pending re-commencement of the project. In particular, the successful completion of the airstrip, which has recently received its first flight, will enable the company to recommence operations using fixed wing aircraft,? the firm said.
West Wits currently owns a 50 percent interest in the alluvial gold project and 50 percent of the exploration rights for the hard rock source of the alluvial, which will increase to 80 percent on $2 million being spent on exploration.
The Derewo River Gold Project is owned by West Wits through its local Indonesian subsidiary PT Madinah Qurrata'ain with local partner the Suhari family of Makassar. The project consists of one granted 40ha mining license, an application for a further 491ha mining license, a granted exploration license of 86,000ha, and two further exploration applications encompassing 43,000ha.
Editing by Johannes Simbolon