TORONTO (miningweekly.com) – Operations have been temporarily suspended at the Batu Hijau openpit copper/gold mine, in Indonesia, Newmont Mining reported on Tuesday.

A geotechnical failure was experienced in the west wall of the pit at the weekend, and operations in the Batu Hijau pit have been halted pending a geotechnical review and the drawing up of a plan to stabilise the wall.

"Initial assessments indicate nominal damage to in-pit infrastructure and equipment," the firm said.

The operation continues to process lower-grade ore from stockpiles and it is too early to determine the impact on production and revenues, Newmont said in a filing.

“The company will provide an update once it has a clear understanding of the impacts of the incident and related remediation on production for 2009.”

Batu Hijau has an advanced monitoring system that measures movement in the pit walls and so no people were in the pit at the time of the wall movement, the company said.

Newmont owns 45% of PT Newmont Nusa Tenggara (PTNNT), which owns the Batu Hijau mine, and Japan's Sumitomo owns 35%. The balance is now owned by an Indonesian company.

Last week, an agreement was reached with the government of Indonesia to extend the cutoff date for the State to buy a series of stakes in the asset.

Under a contract of work signed with the government of Indonesia in 1986, Newmont and Sumitoto agreed to sell a total of 51% in PTNNT to local entities, in stages, over an agreed timeframe.

However, the stakes which should have been divested in 2006, 2007 and 2008 were not sold in the agreed timeframes.

The process was put on hold last year while the parties headed to arbitration, after the government threatened to cancel the contract of work for the operation, because it said the mine's owners were not holding up their end of the bargain.

The arbitration panel ruled the stakes must be sold by September 25, although the parties agreed last week to extend the deadline to November 12.

Newmont's share of sales from Batu Hijau in 2008 totalled 135 000 oz of gold and 130-million pounds of copper.

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