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Theindonesiatoday.com - Southern Arc Minerals expects to resume full-scale exploration of the West Lombok project as it claims to have the support of the local authorities and communities and is confident that discussions with the Ministry of Forestry will be productive.

"Ongoing engagement with the Ministry of Forestry is a top priority for the Company's in-country team," said John Proust, Chairman & CEO of Southern Arc.

"We have a strong relationship with the West Lombok Regency, which holds a ten percent stake in the West Lombok project. We are the number one employer in the district, providing significant economic and social benefits to local communities. All of our exploration activities have been implemented based on extensive consultation with the local authorities," he said.

Following issuance of its mining business license (IUP) in January 2011, Southern Arc initiated the forestry permit process to allow for advanced exploration activities on its West Lombok project. As described in the press release issued on August 26, 2010, approximately 1.1% of the West Lombok property is designated Protected Forest (no open-pit mining allowed; underground mining allowed with the appropriate forestry permit), 55.1% is designated Production Forest (open-pit and underground mining allowed with the appropriate forestry permit) and 43.8% has no forestry designation (no restriction on mining activities).

Since the property had been clear-cut logged in the 1990s, Southern Arc decided to proceed with exploration activities, with strong local government support and encouragement, while waiting for issuance of its forestry borrow/use permit, known as a Pinjam/Pakai permit. The Company has recently been advised to adopt a more conservative approach to its activities within areas designated as Production Forest, regardless of the fact that there are no longer any forested areas on the West Lombok property. As a result, the Company's near-term drilling activities will be focused on targets within areas without forestry designation until the Company receives the Pinjam/Pakai permit.

Southern Arc has relocated two rigs to the Jati and Tanjung targets on the Pelangan prospect, where previous exploration identified a continuous 1.5km-long mineralized epithermal breccia hosting at least one high-grade lode structure. Previous drilling intersections include 10.05m @ 13.4 g/t gold and 8 g/t silver (TGD-02), 9.2m @ 5.9 g/t gold and 11 g/t silver (JDG-03) and 26.2m @ 4.2 g/t gold (including 3.45m @ 12.3 g/t gold: PLD-027).

John Proust said with regard to the company's stated goal of completing two NI 43-101 resource estimates by June 30, 2012, the timing of those resource estimates is contingent upon receipt of the Pinjam/Pakai permit.

Results from the remaining 16 holes drilled on the Waterfall target on the Mencanggah prospect are expected to be released in early January. Southern Arc has recently completed eight holes on the Bising target on the Mencanggah prospect, with results expected by late January. (Theindonesiatoday.com)

Southern Arc Minerals