Indonesia curbing nickel supply to support locals, Eramet says
The French miner was this year given a sales quota by the Asian nation that was 29% less than it expected.
Straits Resources (ASX:SRQ) has announced that it will put its Indonesian Mt. Muro mine on care and maintenance, as the company focuses “squarely on its copper portfolio.”
Mt. Muro has been causing the miner grief for some time now mainly due to weak gold prices and illegal mining operations which caused property damage in late June.
Before today’s announcement, the Australian company had been trying to salvage the mine by cutting costs, redesigning plans and engaging with the community and governments.
“Our first preference has always been to try to turn the operation around,” Andre Labuschagne, the company’s CEO said in a statement. However, “the Board has decided that the continued allocation of material funding to the Mt Muro operations could potentially risk the future of the group, and has made this difficult but necessary decision in order to conserve shareholder value.”
Straits will now begin looking for buyers and says it is “actively seeking to dispose of the asset as soon as possible.”
The site is located on the Kalimantan magmatic arc which includes the Kelian, Mt Muro and Mirah gold deposits. Production in 2011 totaled over 180,000 tonnes of ore.
As part of its mine contract, Straits is required to offer 51% of the company for purchase to the Indonesian government or locals.
3 Comments
Mining Man
Another basket case of a mining company. Should have just stuck to its operation in Nyngan NSW but like all the rest they cant help themselves with expansion and trying to be a mid tier when in reality they are little more than a junior and at best a month by month proposition. Will be one of the first to fold when times get really tough.
John VanPlantinga
Straits should add value instead of fearing loss.
Perhaps the first step is to develop an operational plan that strips needless costs from Tritton Copper to make it well +profitable. One need only look at the photo gallery to see needless costs in evidence. Undoubtedly there are many more that are not shown.
Then do the same at Mr Muro as it also shows some significant needless costs.
We would then propose they announce the easy to understand plan and expected results to the investment public to give value to the stock and to eventually access to capital if needed. Investors buy valid hope, and our hope will deliver. Then we suggest they implement the least CapEx improvements offering the highest ROI first and show how the financial improvements mount as we go. Here is where we build the mountain chart, one improvement at a time. As we deliver on each one, the investors will recognize that we will be able to carry forward with our entire plan.
Thus the next step for Straits is to develop that concrete, rock solid plan, one with no ifs, ands or buts in it.
Undoubtedly many of the cost reductions which can be achieved in our hard magnetite rock example are achievable here. In that example we can reduce OpEx by 51%, CapEx by 37%, Staffing by 29%, and Energy consumption by 42%. Many elements in this example apply to the above projects. Many other elements ot tools not used in the magnetite example can be drawn into action to boost results.
We are North Easter Mining Consultants
Straits can see our web side at http://www.nemc.info or
email us at [email protected]
indonesian
The problem was, lack of management of aussie. as the proverb in Indonesia, if aussie already live in indonesia over 2 years, they are much more dangerous for corruption.
unfortunately the investors not well informed immediately, because the straits’s finance no smarter than that I mentioned earlier.
Perhaps it’s time the land will be returned to the government of Indonesia.