Freeport McMoRan Copper & Gold (FCX-N) has signed a letter of intent to explore and acquire 1.2 million acres in Irian Jaya, Indonesia, currently held by Battle Mountain Gold (BMG-N).
Freeport now holds the option to acquire a 90% interest in Iriana Mutiara Mining (IMM), an Indonesian company which controls a large contract of work (CoW) area in the central part of the province.
The deal calls for Freeport to spend a minimum of US$500,000 on exploration by the end of 1998. If it elects to continue exploration, Freeport would then be responsible for all exploration costs, including any feasibility study.
A substantial portion of the IMM CoW is contiguous with Freeport’s Block II property. Mineralized trends currently being drilled in Block II–the Haiura and Katehawa prospects–extend into the IMM block. In addition, the property may host a nickel laterite resource of commercial potential, says Freeport Chairman James Moffett.
The remaining 10% interest in the IMM contract of work area is held by Vancouver-based Iriana Resources (IR-T.
In other news, Freeport Indonesia (Freeport’s operating company at the Grasberg mine), has cleared another hurdle in its attempt to expand Grasberg’s capacity to 300,000 tonnes per day.
Indonesia’s Minister of Environment approved Freeport Indonesia’s Regional AMDAL (an assessment and monitoring and management plan, similar to an Environmental Impact Statement), which included 42 environmental studies and an extensive analysis of the social conditions in settlements near the mine, says Freeport spokesman Bill Collier.
The Grasberg mill is expected to reach a capacity of 200,000 tonnes per day by the middle of 1998.
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