PERTH (miningweekly.com) – The Indonesian arm of ASX-listed Straits Resources, and the owner of the Mt Muro gold project, has turned to the Indonesian courts to declare voluntary bankruptcy.
Straits executive chairperson Andre Labuschagne said on Friday that bankruptcy had always been the least preferred outcome for PT Indo Muro Kencane (PT IMK), adding that since the operation had been placed on care and maintenance in August, the company had sought a buyer for the operation.
However, despite interest from numerous parties, Straits has been unable to finalise a sales agreement.
The Mt Muro operations were shut after PT IMK failed to progress the mine to a cash positive status. The team had implemented a number of positive measures, including the redesign of the mine plan to reduce waste movements without affecting gold production.
However, a number of unforeseen challenges had impacted on the timing of the Mt Muro project becoming cash-flow positive, including the falling gold price and the impact of illegal miners.
“The process of obtaining court approval for PT IMK to be declared bankrupt can take up to 60 days. Once approved by the Indonesian Commercial Court, PT IMK will move into administration and be managed by a court-appointed curator,” Labuschagne said.
He added that PT IMK being declared bankrupt would have no impact on either the legal status of Straits, or on the company’s solvency.