Saturday, July 28, 2012

Intrepid reportedly "unable to speak directly" to Indonesian 'partner' for past six months

In his article, Intrepid Mines recruits a white knight in Indonesia, The Australian’s Peter Alford reports that directors of the dual Australian/Canadian-listed Intrepid Mines (TSX:IAU)(ASX:IAU) were “perhaps not excessively surprised” when its staff were forced off the Tujuh Bukit prospect in East Java, Indonesia, by its ‘partner’, PT Indo Multi Niaga, 10 days ago.

According to Alford, Intrepid's management had been “unable to speak directly” to PT IMN's directors, Maya Miranda Ambarsari and husband Andreas Reza Nazaruddin, “about most operational matters’ for some six months. Since December “any discussion was conducted on the couple's behalf by their adviser, petroleum industry veteran John Karamoy, and his attitude had quickly turned chilly.”

Intrepid chairman Colin Jackson confirmed the company had reached out to several senior Indonesian businessmen, hoping they might agree to coax Maya and Reza back to the table.

“Intrepid had 460 exploration staff on site in Banjuwangi regency, picturesquely close to East Java's southeast beaches, and the latest drilling was yielding brilliant data. But the tenement leases (now known as IUPs) covering the potentially world-class gold-copper-silver mining operation are held by IMN," Alford reports.

“From their original 2007 agreement onwards, Intrepid maintains, the couple had undertaken that when the law permitted, they would convert to a PMA company, allowing the foreigners direct majority ownership of the leases.

“But after Maya and Reza began leading the non-technical side of the operation -- Intrepid executives insist this was no nominee arrangement, they were working partners -- they began backing away.”

According to Alford, The Weekend Australian asked Jackson whether Edwin Soeryadjaya, chairman of Adaro Energy and founding partner of Saratogo Capital, was one businessmen his company had consulted recently in attempting to repair the IMN breakdown.

"I won't comment on that," he replied. "We actually really don't know. That is our greatest frustration. We don't know with whom we are dealing."

The Weekend Australian also sent questions by email to the Saratoga chairman's office however there was no response by 27 July.

Alford asks, but does not answer,whether Intrepid did its best to prevent shareholders being exposed “to excessive risk by entering such a joint venture and continuing to fund it when the Indonesia partners had not met their obligations?”

According to Colin Jackson, Intrepid had its general counsel based in Jakarta for the past two years and an Indonesian resident director was appointed last November, former PT Freeport Indonesia commissioner Adrianto Macribie.

"The intention was always that IMN would become our local subsidiary," he said. And there had been until recently "a very harmonious joint venture with our Indonesian partner; otherwise we wouldn't have spent close to $100 million on the project".

On 26 July, Intrepid announced that “a dispute notice is being prepared in relation to breaches of the project agreements by the original PT IMN shareholders and on PT IMN.”

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