Baru Gold Corp. (“Baru” or the “Company”) wishes to affirm its ownership rights of the Sangihe Gold Project in response to recent media reports of the Indonesian government revoking mining permits in the country and provides information on a lawsuit recently filed in Indonesia by the Company’s subsidiary PT Tambang Mas Sangihe (“TMS”).
Ownership Rights of TMS
Indonesia’s Investment Minister Bahlil Lahadalia recently announced the Investment Ministry (the “Ministry”) had revoked 2,065 permits covering more than 3.1 million hectares (7.66 million acres) of land across the country to tighten the sector’s governance and land redistribution. This follows Indonesian President Joko Widodo’s decree in January 2022 ordering thousands of mining, plantation and forest-use permits be revoked due to non-compliance or inactivity. The action being taken by the Ministry has no impact on Baru or its operations.
Baru’s permits and licences have not been revoked and remain valid. Baru is compliant in all respects, with the AMDAL (environmental) assessment and Indonesian feasibility study. Most recently, the Company secured its operation and export licence for the mine site.
The Company continues to conduct its daily activities at the site and on the island. The Company continues to generate jobs, hiring locals to fill these positions. Construction is underway on the heap leach pad and a drilling program has been planned. The Company does not anticipate its permits or licences will be affected by the Ministry’s mandate.
Lawsuit Filed by TMS
The Company also wishes to provide information on a recent lawsuit filed by its subsidiary, TMS. The lawsuit has no connection to the ownership rights above.
On August 24, 2022, TMS filed a lawsuit in Jakarta against multiple parties including President Joko Widodo; the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan; National Police Chief Listyo Sigit Prabowo; Minister of Law and Human Rights Yasonna H. Laoly, Komnas HAM; Regent of Sangihe Islands; Mardi Posumah; Grace Kapal; Sonny Posungulah; and Andri Mailoor. TMS is seeking damages to compensate for material losses amounting to US$37 million and Rp. 31.9 billion; and immaterial losses of Rp. 1 trillion.
Baru Gold CEO, Terry Filbert, commented, “TMS holds a valid production/operation licence which has the legal right to explore, construct, and produce gold on the island of Sangihe. To clarify, the island is approximately 71,000 ha and our licence for exploration covers 42,000 ha. TMS has applied to have the exploration area reduced to 25,000 ha. Our exploration activities have been conducted on less than 10% of our licenced area and construction has commenced on a small 65 ha parcel. Our construction activities have been continually delayed by a group supported by illegal miners, whose numbers have expanded significantly since the re-start of operations on the island. TMS has received little to no support from the local police or government departments for operational activities or to ensure the safety of our employees and suppliers. Inadequate effort has been made by local officials to close the illegal mining operations on the island. Despite these obstacles, TMS continues to move ahead with its planned activities. Although this lawsuit does not affect our daily operations at the Sangihe Gold Project, we hope it will draw attention to the situation so action can be taken and TMS can be compensated for the economic losses it has incurred.”
ABOUT SANGIHE GOLD PROJECT
The Sangihe Gold Project (“Sangihe”) is located on the Indonesian island of Sangihe, off the northern coast of Sulawesi. Sangihe has an existing National Instrument 43-101 inferred mineral resource of 114,700 indicated and 105,000 inferred ounces of gold, as reported in the Company's "Independent Technical Report on the Mineral Resource Estimates of the Binebase and Bawone Deposits, Sangihe Project, North Sulawesi, Indonesia" (May 30, 2017). Readers are cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability. The Company intends to proceed to production without the benefit of first establishing mineral reserves supported by a feasibility study.
The Company's 70-percent interest in the Sangihe-mineral-tenement Contract of Work ("CoW") is held through PT. Tambang Mas Sangihe (“TMS”). The remaining 30-percent interest in TMS is held by three Indonesian corporations. The term of the Sangihe CoW agreement is 30 years upon commencement of the production phase of the project.
The Company intends to proceed to production without the benefit of first establishing mineral reserves supported by a feasibility study. The Company cautions readers that the any production decision made by the Company will not be based on a NI 43-101 feasibility study of mineral reserves that demonstrates economic and technical viability and as such, there may be involved increased uncertainty and various technological and economic risks such as the interpretation of drill results; the geology, grade and continuity of mineral deposits; the possibility that future exploration, development or mining results will not be consistent with our expectations; commodity and currency price fluctuation; failure to obtain adequate financing; regulatory, recovery rates, refinery costs, and other relevant conversion factors, permitting and licensing risks; general market and mining exploration risks and production and economic risks related to design and engineering, manufacturing, technological processes and test procedures and the risk that the project's output will not be salable at a price that will cover the project's operating and maintenance costs.
ABOUT BARU GOLD CORPORATION
Baru Gold Corporation is a dynamic junior gold developer with NI 43-101 gold resources in Indonesia, one of the top ten gold producing countries in the world. Based in Indonesia and North America, Baru’s team of mining and finance professionals boasts extensive experience in starting and operating small-scale gold and coal assets. With strong retail and institutional shareholder support, Baru is positioned to become Indonesia’s next gold producer.
Frank Rocca, BAppSc.(Geology), MAusIMM, MAIG, CPI-KCMI, Chief Geologist of Baru Gold Corp. is the Qualified Person as defined under NI 43-101 who has reviewed and approves the content of this release.
BARU GOLD CORPORATION
Per: “Terry Filbert”
Terry Filbert, Director
President & CEO
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Certain statements in this News Release, which are not historical in nature, constitute “forward looking statements” within the meaning of that phrase under applicable Canadian securities law. These statements include, but are not limited to, statements or information concerning future work programs, results and timing of any work programs, the Company’s performance or events as of the date hereof. These statements reflect management’s current assumptions and expectations and by their nature are subject to certain underlying assumptions, known and unknown risks and uncertainties and other factors which may cause actual results, performance or events to be materially different from those expressed or implied by such forward looking statements. Those risks include the interpretation of drill results; the geology, grade and continuity of mineral deposits; the possibility that future exploration, development or mining results will not be consistent with our expectations; commodity and currency price fluctuation; failure to obtain adequate financing; regulatory, recovery rates, refinery costs, and other relevant conversion factors, permitting and licensing risks; general market and mining exploration risks and production and economic risks related to design and engineering, manufacturing, technological processes and test procedures and the risk that the project’s output will not be salable at a price that will cover the project’s operating and maintenance costs. Forward-looking statements should not be construed as investment advice. Readers should perform a detailed, independent investigation and analysis of the Company and are encouraged to seek independent professional advice before making any investment decision. Accordingly, readers should not place undue reliance on any forward-looking statement. Except as required by applicable securities laws, the Company disclaims any obligation to update or revise any forward looking statements to reflect events or changes in circumstances that occur after the date hereof.