REG - Asiamet Res Ltd - Corporate Update – Project Financing

Asiamet ResourcesAnnouncement

08/08/2023 08:15

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RNS Number : 6312I  Asiamet Resources Limited  08 August 2023

08 August 2023

 

 

Corporate Update - Project Financing

 

Asiamet Resources Limited ("Asiamet", "ARS" or "the Company") is pleased to
report that considerable progress is being made across all project financing
workstreams for the development of the Company's wholly owned, feasibility
stage, BKM copper mine project located in Central Kalimantan, Indonesia.
Senior bank debt and offtake finance engagements which represent potentially
large components of the proposed BKM mine development capital structure are
progressing well.

 

Highlights

·    Following consultation with potential lead banks for BKM debt
finance, ARS appointed SRK Consulting (Perth) ("SRK") as Independent Technical
Expert ("ITE"). SRK also reviewed the 2019 feasibility study in 2022 providing
important input into workstreams addressed in recent feasibility study
update.

·    Two separate due diligence visits to the BKM project site were
completed by a potential lead bank and the ITE over the past three weeks.

·    Several leading international metals trading groups are undertaking
detailed due diligence for financing tied to copper cathode offtake.

·    Growing interest from Chinese Engineering, Procurement and
Construction ("EPC") contractors and proposed project partners introduced
through China based advisor, Zenith Capital. Engagement with Indonesian EPC
and Engineering, Procurement, Construction and Management ("EPCM") groups has
also commenced.

·    Preparation for early engineering design works is underway with
specialist engineering contractors and equipment suppliers.

·    Grant Samuel, Australasia's leading independent corporate advisor, is
engaging with a potential lead financier and supporting ARS to finalise its
financing model and prepare related valuation metrics.

Due diligence site visits to the BKM copper project have recently been
completed by a globally recognised bank experienced in resource project
financing and the bank-ratified ITE, SRK. These site visits are an important
step in the due diligence process required for first phase bank credit
approval, which is targeted for completion before the end of this calendar
year.

Simultaneously, there is an escalating interest in securing the copper cathode
off-take for the BKM project. Several leading international metals trading
groups are advancing their due diligence to provide indicative term sheets for
pre-payment financing tied to copper cathode off-take.

In parallel with the debt financing, engagement with parties introduced by our
China based advisors, Zenith Capital, has also been very positive with several
discussions ongoing for a range of financing models which will support the
development of the BKM project. These include various forms of equipment and
EPC related finance.

 

Darryn McClelland, Chief Executive Officer commented:

We are pleased to report that progress on the BKM Copper Project financing is
accelerating. Representatives of both a potential lead finance bank and the
appointed Independent Technical Expert, SRK Consulting, recently completed
visits to Central Kalimantan and the proposed BKM mine development site as
part of their due diligence processes. Visits to the Company's drill core
storage facility, which houses all drill core from across the entire KSK
contract of work, enhanced the project's credibility and provided an
opportunity to demonstrate the considerable upside potential of KSK. A key
outcome of the site visits was the establishment of the financiers'
expectations for engagement of project execution contractors. Considerable
engagement is continuing with both parties targeting completion of all
requirements for first stage credit approvals before the end of this year.

Simultaneously with the work on the senior debt financing several other
financing workstreams are being advanced. Detailed discussions are in progress
with several globally recognised metals trading groups interested in securing
copper offtake linked to an upfront pre-payment.  Offtake finance is expected
cover a sizeable portion of the overall project finance, which would bring
considerable benefits for both the project and shareholders.

Additionally, early engagement with parties introduced by our China advisors,
Zenith Capital, has also been positive. Several different project financing
models involving the supply of equipment and/or construction services as well
as partnering to financially support development of the project are being
discussed.

The outlook for copper remains very robust, with medium to long term demand
forecast to remain strong and the supply-side response challenged to meet this
growing demand. New copper projects are few and far between and the BKM copper
heap leach project is strategically positioned to deliver LME grade A copper
cathode into a supply constrained Asian market.

Asiamet is progressing the financing process and driving the BKM Copper
Project towards a successful development as quickly as possible. We are
grateful for the continued support of investors and stakeholders through this
period and will keep the market informed with regular updates on our
progress."

 

 

BKM Copper Project Site Visit

Site visits were recently completed by a potential lead financier ("PLF") and
the bank ratified ITE, SRK.  The site visit by the PLF is an important step
in the due diligence process required for first phase credit approval
targeting to be completed before the end of this year.  The site visit for
both the PLF and ITE included the following key areas:

·    An overview of the logistics route, travel from Palangkaraya to site,
and assessing some of the to be developed access roads.

·    An inspection of proposed locations of various site facilities, most
notably the BKM Mining Area.

·    An overview of the geology and visit to the core storage facility
near Palangkaraya.

·    Various discussions on all aspects of the BKM project feasibility
study update.

·    A presentation on community engagement and ESG development provided
to the PLF.

·    Meetings with lead contributors on BKM open pit geotechnical and
hydrogeology studies.

It is envisaged the PLF will work together with top tier Indonesian banks on
the overall debt financing package for the BKM copper project.

Grant Samuel, Australasia's leading independent corporate advisor, is
supporting Asiamet on the various financial workstreams and engagements.
Photos from the two recent project finance related site visits are provided
below.

 

 

Photo 1: Potential lead bank representatives at the BKM site with Asiamet KSK
project team.

 

Photo 2: Potential lead bank representatives inspecting drill core at the KSK
Core Storage Facility.

 

Photo 3: BKM Core Inspection with representative of Independent Technical
Expert, SRK Consulting.

 

ON BEHALF OF THE BOARD OF DIRECTORS

Darryn McClelland, Chief Executive Officer

For further information, please contact:

-Ends-

Darryn McClelland
Chief Executive Officer, Asiamet Resources Limited

Email: darryn.mcclelland@asiametresources.com
(mailto:darryn.mcclelland@asiametresources.com)

 

Tony Manini
Executive Chairman, Asiamet Resources Limited

Email: tony.manini@asiametresources.com
(mailto:tony.manini@asiametresources.com)

 

Investor Enquiries

Sasha Sethi

Telephone: +44 (0) 7891 677 441

Email: Sasha@flowcomms.com (mailto:Sasha@flowcomms.com) /
info@asiametresources.com

Asiamet Resources Nominated Adviser
RFC Ambrian Limited

Andrew Thomson / Stephen Allen

Telephone: +61 8 9480 2500

Email: Andrew.Thomson@rfcambrian.com (mailto:Andrew.Thomson@rfcambrian.com) /
Stephen.Allen@rfcambrian.com (mailto:Oliver.Morse@rfcambrian.com)

 

Optiva Securities Limited
Christian Dennis

Telephone: +44 20 3137 1903

Email: Christian.Dennis@optivasecurities.com
(mailto:Christian.Dennis@optivasecurities.com)

 

Follow us on twitter @AsiametTweets

 

FORWARD-LOOKING STATEMENT

This news release contains forward-looking statements that are based on the
Company's current expectations and estimates. Forward-looking statements are
frequently characterised by words such as "plan", "expect", "project",
"intend", "believe", "anticipate", "estimate", "suggest", "indicate" and other
similar words or statements that certain events or conditions "may" or "will"
occur. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause actual events or results to
differ materially from estimated or anticipated events or results implied or
expressed in such forward-looking statements.   Such factors include, among
others: the actual results of current exploration activities; conclusions of
economic evaluations; changes in project parameters as plans continue to be
refined; possible variations in ore grade or recovery rates; accidents, labour
disputes and other risks of the mining industry; delays in obtaining
governmental approvals or financing; and fluctuations in metal prices.  There
may be other factors that cause actions, events or results not to be as
anticipated, estimated or intended.  Any forward-looking statement speaks
only as of the date on which it is made and, except as may be required by
applicable securities laws, the Company disclaims any intent or obligation to
update any forward-looking statement, whether as a result of new information,
future events or results or otherwise. Forward-looking statements are not
guarantees of future performance and accordingly undue reliance should not be
put on such statements due to the inherent uncertainty therein.

 

 

 

 

 

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