Yet another progress for Southern Arc's project

Southern Arc Minerals Inc told TSX Venture on Tuesday that minister of public works has signed the revision of the provincial regulation (Perda) on West Nusa Tenggara spatial planning, which might pave the way for its gold and copper project in the province.

Southern Arc said the National Spatial Planning Body (NSPB) completed its work on the new regulation in November and earlier this month referred the document for the approval of the Minister of Public Works, who oversees the NSPB. The Minister has signed the Perda and it has been forwarded to the Provincial Legislature in Mataram for its final approval and enactment into law.

Southern Arc has currently assembled a portfolio of six projects on the islands of Java, Lombok and Sumbawa. Sumbawa Island hosts Newmont Mining's world-class Batu Hijau mine, which adjoins Southern Arc's Taliwang property immediately to its north. 

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Southern Arc & Indotan close acquisition

TSX Venture-listed Southern Arc Minerals Inc. has closed its acquisition of certain rights from Indotan Inc., including the right to the name Indotan Inc. Subsequent to its previous announcement, the structure of the transaction was modified to include the acquisition of two Singapore subsidiaries of Indotan.

Indotan assigned its rights to the Indotan name, granted Southern Arc power and control over all matters related to the Singapore companies, and has agreed to transfer the shares in the Singapore companies to Southern Arc once the required permits have been granted to the Singapore companies pursuant to the mining laws of Indonesia.

In consideration for the assignment of the rights to the applications, the acquisition of the subsidiary and the name Indotan Inc., Southern Arc will issue 3.5 million common shares to the parent company subject to two options in favour of Southern Arc. The first option will entitle Southern Arc to acquire 1.5 million of these shares at a price of $0.90 per common share within a period of 18 months. 

The second option will entitle Southern Arc to acquire 0.5 million of these shares at a price of $0.50 per common share within a period of 8 months. All of the shares to be issued by Southern Arc will be subject to a four month statutory hold period. In place of the existing 1% NSR’s on both the Sumbawa and Lombok Properties, Southern Arc will grant a 2% NSR on the Sumbawa property and a 1% NSR on the Lombok Property, as those applications were originally described in March, 2005. 

In the case of the Lombok Property, the NSR does not apply to the Block 1 property (which encompasses all of Selodong, Mencanggah, and Pelangan prospects) acquired by Southern Arc from Newmont in January, 2006.

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Southern Arc expects mining clearance

Southern Arc Minerals Inc expects the new land utilization regulations will remove restrictions to its mining activities in West Nusa Tenggara.

In December 2006 the Provincial Governor introduced the Perda which purported to restrict mining activity on Lombok Island. The Perda was enacted without the consent of the relevant Regency and Central governments. In order to address this, the Central Government passed the National Spatial Planning Law 26/2007 and amendment No. 4725 (the “Federal Law”), requiring, the Provincial Government, by November 2009, to reclassify the entire provincial territory into designated zones (e.g. mining, agriculture or tourism).

Pursuant to the Federal Law, the Central Government formed the National Spatial Planning Body (the “NSPB”) in order to develop provincial laws which conform to the Federal Law. As of November 30, 2009 the Company has been informed by officials within the Central and Provincial governments that: 

(1) The NSPB has concluded their deliberations and has scheduled an official signing ceremony to be held in Jakarta on December 10, 2009 to formally endorse the revisions in order for the Perda to conform with the Federal Law; and 

(2) The revised Perda will then be presented to the Provincial Legislative Body in Mataram for final approval and subsequent enactment into law.

"Once these new land utilization regulations are in effect, all prior restrictions to mining activities on Southern Arc properties will be immediately removed," Southern Arc said in a statement to Toronto Stock Exchange (TSX) Venture on Tuesday.

Southern Arc has currently assembled a portfolio of six projects on the islands of Java, Lombok and Sumbawa. Sumbawa Island hosts Newmont Mining's world-class Batu Hijau mine, which adjoins Southern Arc's Taliwang property immediately to its north.

READ MORE!!!