REG - Asiamet Resources Ld - BKM Copper Project Optimised Feasibility Study

Asiamet ResourcesAnnouncement

07/05/2025 07:00

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RNS Number : 5788H  Asiamet Resources Limited  07 May 2025

7 May 2025

 

Asiamet Resources Limited

("Asiamet" or the "Company")

Completion of BKM Stage 1 Copper Project Optimised Feasibility Study

 

Delivering a Realistic, Financeable First Stage Project to Unlock District
Scale

Production Growth

 

Asiamet Resources Limited (AIM: ARS) is pleased to announce the completion of
the Optimised Feasibility Study ("OFS") for BKM Stage 1, the first phase of
development at the Company's 100%-owned BKM Copper Project ("BKM" or "the
Project") in Central Kalimantan, Indonesia.

 

BKM Stage 1 has been engineered as a simplified, lower-capex, staged-build
heap-leach operation focused on near-surface, higher-grade ore. It is
designed to deliver LME Grade A copper cathode which is fully compliant with
Indonesia's downstream processing requirements and aligns with national
development priorities.

 

With targeted average annual production of approximately 10,000 tonnes of
copper cathode, BKM Stage 1 offers an efficient entry into production at a
time when copper deficits are expected to deepen significantly going forward.

 

The completed OFS delivers optimised engineering designs from our study
partners Rexline Engineering, BGRIMM Technology, Mineria & Servicios,
Claveria Consulting and Buma Infrastructure.  The study also reflects direct
feedback from prospective lenders, updated permitting schedule and robust
execution planning incorporating the latest royalty and fiscal framework
established by the Government of Indonesia.

 

The study establishes BKM Stage 1 as a technically robust, financeable project
with highly attractive economics and is a strategic first step in laying the
foundations for long-term value creation across the broader KSK Contract of
Work. With key infrastructure and execution significantly de-risked, the
Company sees substantial upside potential from the immediately adjacent BKZ
base and precious metals deposit, BKM primary sulphide resource, high-grade
copper drill hits at BKS, and multiple additional targets across the KSK
licence area.

 

Key Highlights:

 

·    Annual copper cathode production of approximately 10k tonnes with a
~13 year mine life

·    Life-of-mine revenues of US$1.192 billion and EBITDA of US$612.2
million 1  (#_ftn1)

·    Initial capital cost of US$178.4 million, including US$11.1 million
(7.6%) growth allowance and US$21.8 million (~ 13.9%) contingency

·    Post-tax NPV81 of US$122.4 million, post-tax IRR1 of 17.7%, and
payback period of 4.5 years

·    Life-of-mine production of 124,022 tonnes of LME Grade A copper
cathode

·    Low strip ratio of 0.77:1, Life-of-Mine C1 costs of US$1.79/lb and
AISC of US$2.37/lb

 

Development and Strategic Positioning

·      Execution-Ready: Compact site layout and proven technology
significantly reduce construction and operational risks.

·      Lender Engagement Ready: Updated engineering and financials; ITE
review process near completion.

·      Strategic Engagement Underway: OFS unlocks structured engagement
with a comprehensive list of parties interested in strategic investment and/or
product offtake

·      Platform for Growth: BKM Stage 1 establishes foundational
infrastructure to unlock significant upside across the KSK Contract of Work,
including the remaining 80kt of un-leached copper in spent heap leach ore,
245kt in-situ sulphide copper resource at BKM and the high-grade BKZ
polymetallic deposit.

·      Leveraged to Positive Global Copper Outlook: NPV(8) of US$142
million and IRR of 18.9% using a $4.52/lb LT price (broker consensus + 5%),
and NPV(8) of US$202 million and IRR of 22.9% using a $5.00/lb LT price
(highest broker price), highlighting the strong leverage of BKM Stage 1 to an
uplift in copper price.

BKM Project Sensitivity to Copper Price

 

 Case                                       OFS Base Case (Broker Consensus)  Upside Case          High Case

                                                                              (Broker Consensus)   (Broker Consensus)
 LT Copper Price                    US$/lb  4.30                              4.52                 5.00
 Revenues                           US$M    1,192                             1,240                1,372
 EBITDA                             US$M    612                               656                  778
 NPAT                               US$M    372                               412                  524
 NPV(8) (post-tax, inc. closure)    US$M    110                               129                  189
 NPV(8) (post-tax, excl. closure)   US$M    122                               142                  202
 IRR (post-tax, excl. closure)      %       17.7                              18.9                 22.9
 Payback Period                     Yrs     4.5                               4.4                  3.8

Note: all figures presented on a real basis; OFS Base Case: based on consensus
copper price forecast of 21 broker as of 4 April 2025; Upside Case: LT broker
consensus price + 5.0%; High Case: based on highest broker LT price forecast.
 

 

Advancing Financing and Strategic Process

 

With the OFS complete, Asiamet will initiate formal engagements with its
prospective lenders and update data rooms for a structured engagement process
with interested parties. These include commodity traders seeking offtake,
smelter-linked entities, and regional industrial operators. Many of these
groups, some of which are already under NDA,  have been awaiting completion
of the updated study to be released prior to commencing formal due diligence.

 

Darryn McClelland, Asiamet's Chief Executive Officer, commented:

 

"Completing the BKM Optimised Feasibility Study marks a major milestone on our
path towards becoming a copper producer. The optimised study balances scale,
production rate and mine life - qualities we believe will attract strong
interest from local and international lenders.

 

The study delivers a technically robust, development-ready copper project
featuring updated capital estimates, a compact execution footprint, and
alignment with prospective lender requirements. The simplified development
approach materially reduces execution risk while retaining strong leverage to
copper price upside.

 

Importantly, BKM Stage 1 is just the beginning. It establishes a solid
platform for unlocking long-term growth across the broader KSK licence area,
including the development of the BKM primary sulphide resource and the
adjacent high-grade BKZ polymetallic base and precious metals deposit. We
believe the BKM development strategy will underpin Asiamet's ability to grow a
multi-asset, long-life copper operation in one of Asia's most strategic growth
corridors.

 

Our immediate focus now shifts to formal financing discussions and structured
engagement with a growing list of interested parties."

 

Tony Manini, Asiamet's Executive Chairman, commented:

 

"With this study, Asiamet has delivered a simplified and financeable
first-phase project that meets the realities of today's market while laying
the foundation for something much larger. BKM Stage 1 is the enabler - a
practical starting point that brings Asiamet to the threshold of production
and unlocks future growth across a highly prospective copper district.

 

This is a pivotal milestone for Asiamet. With financing preparations now
underway and interest from multiple well-qualified parties, we are focused on
delivering the best path forward for shareholders - whether through
development, partnership, or a strategic transaction."

 

Next Steps:

·      Finalisation of Independent Technical Expert (ITE) review.

·      Formal launch of structured engagement with lenders and strategic
investors.

·      Appointment of Project Director to lead the BKM project
engineering and construction.

·      Early engagement of construction contractor/s.

·      Finalisation of key permitting activities.

·      Preparation for detailed engineering design and project
execution.

·      Targeting a Final Investment Decision (FID).

 

A copy of the 2025 BKM Feasibility Study Executive Summary is available on the
Company's website at www.asiametresouces.com (http://www.asiametresouces.com)
and appended to this announcement via the following link
https://asiametresources.com/technical-reports/
(https://asiametresources.com/technical-reports/)

 

 

Investor Presentation via Investor Meet Company:

 

ASIAMET RESOURCES LIMITED is pleased to announce that Tony Manini Executive
Chairman and Darryn McClelland CEO will provide a live presentation via
Investor Meet Company on Friday 9 May 2025, 08:00 BST.

 

The presentation is open to all existing and potential shareholders. Questions
can be submitted pre-event via your Investor Meet Company dashboard up until
08 May 2025, 09:00 BST, or at any time during the live presentation.

 

Investors can sign up to Investor Meet Company for free and add to meet
ASIAMET RESOURCES LIMITED via:

https://www.investormeetcompany.com/asiamet-resources-limited/register-investor
(https://www.investormeetcompany.com/asiamet-resources-limited/register-investor)

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended.

 

ON BEHALF OF THE BOARD OF DIRECTORS

Darryn McClelland, Chief Executive Officer

 

-Ends-

For further information, please contact:

 

Darryn McClelland
Chief Executive Officer, Asiamet Resources Limited

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

 

Tony Manini
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

Nominated & Financial Adviser
Strand Hanson Limited

James Spinney / James Dance / Rob Patrick

Telephone: +44 20 7409 3494

Email: asiamet@strandhanson.co.uk (mailto:asiamet@strandhanson.co.uk)

 

Broker

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 announcement 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.

 

APPENDIX - BKM PROJECT FEASIBILITY STUDY DETAILS

The BKM Feasibility Study Life of Mine key metrics are included in Table 1
below.  The following economic assumptions were utilised:

·        Long term copper price of $4.30/lb (real)

·        Discount rate 8% (after tax, real)

·        Indonesian corporate income tax ('CIT') rate of 22% 2 
(#_ftn2)

·        Indonesian Government Royalty of 7% (of revenue)

Note : All references to ($) dollars in the tables below are US Dollars.
Tables with decimals may not add due to rounding.

Table 1: Summary LOM BKM Feasibility Study Metrics

 

 Area         Measure                                           Unit       Feasibility Study
 Production   Initial mine life                                 Years      12.8
              Ore mined                                         Mt         28.5
              Waste mined                                       Mt         22.0
              Strip ratio                                       Waste:Ore  0.77:1
              Average soluble copper grade                      %          0.55
              Soluble copper recovery (from Heap Leach)         %          79.0
              Copper cathode produced                           Kt         124.0
 Capital      Initial project capital (ex. Growth & Cont.)      $M         145.5
              Growth                                            $M         11.1
              Contingency                                       $M         21.8
              Total Project Capital Cost                        $M         178.4
              Life of Mine Sustaining capital                   $M         22.7
 Closure      Closure costs                                     $M         45.3
 Economic     LT Copper price                                   $/lb       4.30
 Assumptions  Discount                                          %          8.00
 Financials   Revenue                                           $M         1,191.8
              Operating costs (ex. royalties)                   $M         488.3
              Royalties                                         $M         91.2
              EBITDA                                            $M         612.2
              NPAT                                              $M         372.6
              C1 costs                                          $/lb       1.79
              AISC                                              $/lb       2.37
              NPV(8) post-tax                                   $M         109.7
              NPV(8) post-tax, pre-closure                      $M         122.4
              IRR post-tax                                      %          17.3
              IRR post-tax, pre-closure                         %          17.7
              Payback period                                    Years      4.5

 

The estimated initial construction capital costs are in summarised in Table 2
below.

 

 

Table 2: Capital Costs

 

 Plant Area                                                   Capital Estimate $M
 Mining Infrastructure                                        14.1
 Process Plant Infrastructure                                 63.3
 On-Site Infrastructure                                       17.2
 Off-Site Infrastructure                                      3.6
 Construction Erection                                        25.0
 Freight                                                      5.0
 Project Indirects                                            17.3
 Total Capital Estimate (excluding Growth & Contingency)      145.5
 Growth                                                       11.1
 Contingency                                                  21.8
 Total Capital Estimate                                       178.4

The capital cost estimate in Table 3 relates to the project construction costs
and excludes sustaining capital and mine closure costs.

The total Life of Mine (LOM) operating costs, sustaining capital and estimate
mine closure cost are shown in Table 4.

Table 3: LOM Operating Costs

 

 Site Operating Costs        $M      Cost $/lb
 Mining                      175.00  0.64
 Processing                  187.50  0.69
 General and Administration  125.85  0.46
 LOM C1 Cash Cost            488.35  1.79
 Royalties                   91.20   0.33
 Sustaining Capex            22.72   0.08
 Closure Cost                45.31   0.17
 AISC                        647.57  2.37

 

A mine operations life of 12 years 9 months and heap leach operations life of
12 years 11 months leads to no major replacement or rebuilds being necessary
on major equipment. Sustaining capex needs for the project are dominated by
the ongoing costs of expanding and managing the Heap Leach Facility.

The mining activities related to earthmoving will be undertaken by an
equipment supply contractor under the direction of the Company. Other
specialist activities such as Blasthole drilling and supply and delivery of
explosives to the field will be contracted to specialist service providers.
The mining LOM cost is forecast to be $3.47 per tonne of material mined or
$0.64 per pound of copper produced inclusive of mine geology and ancillary
mining activities.

The LOM processing costs equate to $6.58 per tonne ore stacked or $0.69 per
pound copper produced, with the most significant cost being electricity
consumption.  Power is now proposed to be sourced from the development of a
new, dedicated coal-fired power station located on site at BKM. The study cost
model adopts a build, own, operate and maintain model provided by a
third-party supplier with current estimates delivering a unit cost of 14c per
kilowatt hour.

General and Administration costs include transport and logistics (contracted),
site camp services (contracted), Supply Chain Management, Information
Technology, Environmental, Sustainability and Governance and overhead
administration activities. The LOM unit cost of these activities in the
financial model is $4.42 per tonne ore processed or $0.46 per pound copper
produced.

The charts below show the Life of Mine (LOM) production (Figure 1) and Ore
delivered to the heap leach facility along with Soluble Copper grade (Figure
2). Ore mined is slightly lower in years 1-3 as higher grades of soluble
copper are mined first delivering strong early-stage cash flows to the
project. The LOM strip ratio is low at 0.77:1, aiding the profitability of the
project.

 

Figure 1: LOM Mining Production

 

Figure 2: LOM Ore Stacked and Soluble Copper Grade

Figure 3 LOM Copper Cathode Production

 

Strong free cash flow generation is expected from the project with the LOM net
operating cash flows of $557 million.  This strong cash flow generation
underpinned by a long-term copper price of $4.30/lb results in a 4.5 year
payback period for the Project.

 

Figure 4 LOM Project Cash Flows - US$M(1)

1.        Yr1 Figure 4 represents first year of expenditure on the
project, Yr4 represents Yr1 of production as shown in the production figures.

 

As part of the Feasibility Study, a sensitivity analysis was conducted to
determine the effect of key variables on the base case NPV(8) of $122.4
million (post tax and excluding closure costs).  The results of this analysis
are shown in Figure 5.

 

Figure 5: Project Sensitivities - US$M Base NPV(8) (Post-tax, Real)

Table 4 provides a sensitivity of +/- 2% for the Company's 8% weighted average
cost of capital (WACC).

Table 4 Weighted Average Cost of Capital Sensitivity

 

 NPV +/- 2%                  NPV(6)  Base Case NPV(8)  NPV(10)
 NPV post-tax                149.0   109.7             77.3
 NPV post-tax (pre-closure)  166.1   122.4             86.8

 

Indicative Timeline

The timeline below is indicative and subject to certain milestones being
achieved.  Progressing the project financing is a critical enabler to
commencing significant development works.

Project Opportunities 3  (#_ftn3)

Several opportunities are available to help further improve project economics.
These will be explored prior to, and during the detailed engineering design
phase.

·    Additional copper recovery from process bleed and mine drainage
(~3,500 tonnes of copper identified):

o  Explore technology to recover copper within the plant Neutralisation
process.

o  Potential to add revenue during operations by recycling recovered copper
and ultimately help offset mine closure costs by recovering copper from
wastewater streams.

·    Potential to improve copper recovery from BKM Stage 1 heap leach
through application of new heap leach technologies:

o  Overall copper recovery from BKM Stage 1 is approximately 60%.

o  Once in operation, bulk samples can be tested with existing and emerging
technologies targeting minerals difficult to leach copper minerals
chalcopyrite and bornite.

o  Improving overall copper recovery from the existing life of mine ore
inventory could deliver significant economic upside over the life of mine.

 

Future Development

The BKM Copper Project is the first step in a larger development plan across
the KSK Contract of Work (CoW), aiming to establish a new mining district and
supporting infrastructure. The long-term strategy adopts a phased approach,
building on the foundation of the initial BKM heap leach operation.

·    Phase 1A - Expansion of the BKM heap leach operation

·    Phase 2 - Processing of 240kt of in-situ sulphide copper resource at
BKM and 85kt of copper in spent heap leach ore

·    Phase 3 - Development and integration of high grade BKZ polymetallic
deposit

 

Overall, there remains significant future development opportunities at BKM and
the broader KSK CoW.

 

 1  Excluding closure and rehabilitation costs

 2  Tax holiday (subject to successful application of regulation, PMK-130
(130/PMK.010/2020)) of a 100% Corporate Income Tax reduction for 7 years
followed by a further 2 years at a 50% reduction.

 3  Asiamet cautions the Project Opportunities described above are preliminary
in nature and have only been subjected to high-level preliminary assessment.
It is uncertain if further evaluation and or exploration work will result in
the implementation of any of the potential opportunities or whether any
additional economic benefit will be realised.

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