EXPLORATION ROUNDUP — Meekatharra postpones Canadian offering

Australian-based Meekatharra Minerals has postponed a private placement that would have raised several million dollars for exploration and development in Indonesia and paved the way for a Canadian stock exchange listing.

Meekatharra says the tax liability associated with its proposal to float up to 40% of MM Gold, a subsidiary formed to hold the company’s Indonesian gold properties, soured the deal.

Despite the setback, MM Gold maintains participating interests in, and manages exploration on, some 14,500 sq. km along the prospective geological terranes that underlie the islands of Indonesia.

Meanwhile, Teck (TEK-T), under an agreement with Meekatharra, can earn a 51% interest in MM Gold’s stake in any of six projects in exchange for funding a feasibility study and providing production financing.

Meekatharra has a 90% interest in five of these projects and a 75% interest in the sixth. Indonesian partners hold the remaining interest in the 11,405-sq.-km land package.

One of the most promising projects in the joint venture is the Muarawahau, in northeastern Kalimantan. The property lies along the Trans Borneo gold belt, a linear trend that hosts the Kelian, Mount Muro and Busang gold deposits.

Meekatharra also holds several properties outside of the joint venture, including an 85% interest in the Way Linggo gold-silver deposit. Before the financing deal was postponed, the mine was slated to begin production in January at an annual rate of 35,000 oz. gold and 500,000 oz. silver.

Meanwhile, results from the 45%-owned Bird’s Head project in Irian Jaya has identified nine drainage systems with gold and/or copper anomalies.

Meekatharra expects to begin follow-up work on the property before the end of the year.

The postponed offering was intended to place 11 million shares of MM Gold at $3 per share. Proceeds would have been used to finance a 2-year, $14-million exploration program and contribute $9 million towards the capital costs of developing the Way Linggo mine.