REG - Asiamet Resources Ld - Corporate Update

Asiamet ResourcesAnnouncement

01/03/2024 07:15

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RNS Number : 2276F  Asiamet Resources Limited  01 March 2024

1 March 2024

 

Corporate Update

 

Asiamet Resources Limited ("Asiamet" or the "Company") announces updates in
relation to the Company's BKM copper cathode project in Central Kalimantan,
Indonesia ("BKM" or the "BKM Project") and its Beutong copper-gold porphyry
project in Aceh Indonesia ("Beutong").

Highlights

·    Debt Finance Process: Positive engagement with Lead Bank continues,
with financial modelling completed for BKM Project financing. The Company has
successfully closed out several items from the Independent Technical Expert
("ITE") review, meeting the requirements for the initial phase of approvals.
The Company is also actively engaged with a prominent Indonesian bank.

·    Engineering Design & Development Strategy: Finalising partners for
project execution and engaging partners for project management support.
Updates on partner appointments expected before the end of Q1 2024.

·   BKM Project Optimisation: Evaluation of alternative locations for the
heap leach facility. Detailed modelling of a new facility will commence in the
near term with the expected appointment of a dedicated heap leach design
group. The BKM Project execution model is being amended to reflect feedback
over the ITE and bank financing process.

·     BKM Project Permitting: Prioritising closure of the final outstanding
item required to obtain the forestry permit to develop a mine at BKM.
Additionally, awaiting release of the environmental permit from Ministry of
Environment for the limestone resource drilling programme to the north of the
BKM Project.

·    Power Supply for BKM Project: Advancing Biomass Power Station studies
and financing options with turnkey power providers. Study expected to be
completed by the end of Q1 2024, with further details on financing and
technical partners to follow.

·    Concentrate Logistics: Evaluating truck and barge configurations for
cost optimisation. The Company has received encouraging cost estimates from
its scoping study.

·    Corporate Development: Elevated interest in the KSK and Beutong assets
from multiple parties. The Company is facilitating due diligence and site
visits. Advanced, high-quality copper and copper-gold assets in various stages
of maturity are rare in the Asian region and are appealing to investors
seeking to secure copper metal longer term.

Debt Finance Process

Positive engagement continues with the prospective Lead Bank, and financial
modelling for BKM project's financing base case has now been completed. The
Company has successfully closed out several items from the ITE review,
including providing additional information on the biomass power and proposed
project execution partners and construction contractors, meeting the
requirements for the initial phase of approvals.

Moreover, the Company is actively engaged with a prominent Indonesian bank to
join the financing consortium, with planning for due diligence underway and
further announcements will be made, as appropriate.

 

Engineering Design & Development Strategy

Feedback from ITE review process highlighted the critical importance of early
engagement of project execution partners to achieve confidence in project
delivery outcomes. The Company is currently finalising the selection of
partners to support the engineering design, longer term procurement and
construction execution for the BKM Copper Project. During the 2023 feasibility
update, the Company identified highly capable and experienced local and
regional companies which have clearly demonstrated improved cost outcomes
relative to other providers.

Additionally, the Company is engaging with partners capable of providing
project management support, such as Project Management Office services,
ensuring that project deliverables such as detailed baseline project
schedules, capex estimate updates and execution planning are established and
maintained.

These advancements highlight the progress made in strengthening the project's
execution team as the Company advances the BKM Copper Project. A further
update on the appointment of both project execution and project management
partners will be provided as appointments are made.

BKM Project Optimisation

Optimisation initiatives to enhance the efficiency and cost-effectiveness of
the BKM Project are continuing throughout the financing process, including the
evaluation of alternative locations for building the heap leach facility
("HLF"). Detailed modelling of an alternative and significantly improved site
has been identified within the current mine. An updated layout and design will
commence with the appointment of a dedicated heap leach design consultant,
which will be announced in the near term.

Furthermore, optimisation works extend to reviewing the project delivery model
for BKM which will encompass various aspects such as engineering resources,
operating and capital costs, and strategic sourcing of key supplies. An
example of the optimisation works delivering significant value to the BKM
Project is the recent review of site access road earthworks and local
equipment hire costs, which indicate potentially significant savings relative
to previous estimates.

BKM Project Permitting

There remains one outstanding requirement for the issuance of the Company's
forestry change of land use permit (PPKH) by the Indonesian Ministry of
Environment and Forestry Department, being the preliminary agreement on the
shared use of the forestry access road to the BKM site. The Company has
completed all other necessary requirements, including obtaining the Governor's
Recommendation following satisfaction of various environmental, technical,
financial, and community development needs, as well as completing the revised
environmental and social impact assessment (AMDAL)  The Company is currently
prioritising the completion of this final remaining requirement.

Additionally, the Company is awaiting the final release of an environmental
permit to commence a limestone resource definition drilling programme in the
Rinjen area immediately to the north of the BKM Project. Securing a local
limestone supply for use in controlling heap leach chemistry will be a major
operating cost benefit for BKM.

Power Supply for BKM Project

The Company is in the process of finalising arrangements with financing and
technical partners for the Biomass Power Station for the BKM Project.

Supporting studies are focused on assessing various factors, including the
availability of Palm Oil waste (which will be used as a Biomass source) within
close proximity of the site, considerations regarding the optimal location for
the power station and capital and operating cost trade off studies. This work
assessing the physical and financial viability of utilising biomass for power
generation at BKM is expected to be completed by the end of Q1 2024.

Details relating to the funding and technical model will be announced once
complete.

Concentrate Logistics

An internal scoping study has been concluded on the combined truck and river
barge haulage of pyrite concentrate, used to produce acid for the expanding
nickel industry in Indonesia. The feed to produce the pyrite concentrate would
be from BKM's primary copper resource and spent heap leach ore.  Given the
location of the BKM site relative to where the emerging nickel high pressure
acid leach ("HPAL") facilities are likely to be located, understanding the
transport and logistics requirement is crucial to ensure project viability.

Following further review by an external local specialist consultant, it has
been identified that significant improvements in transport costs can be
achieved by increasing the proposed transport barge size. The Company is
currently evaluating various combinations of truck and barge configurations to
refine costs and optimise the concentrate product transport logistics.

Corporate Development

Strong in-bound interest continues to be evaluated by the Corporate
Development team, with potential project level investment in either its KSK or
Beutong licences, or potentially both.  From late 2023 and into 2024,
extensive due diligence processes have been underway, including a data room
review and more recently site visits by several interested parties.

 

To solve for the project funding requirement for the development of the BKM
Project, the Company is evaluating a potential divestment of part or all of
either project.  The introduction of a partner at the project level has
ancillary benefits associated with the development of the project and
operations of the mine.

 

Furthermore, ongoing disruptions in the copper market, coupled with the
imperative to meet global energy transition requirements are attracting
increased investor interest in Asiamet's portfolio and assets. The Company's
high-quality copper projects are poised for development and production as
copper demand is accelerating.

 

Potential investors recognise the significant time and investment the Company
has made to establish its Mineral Resources and Ore Reserves, the completion
of Feasibility Studies and its advancement of a sustainable development
platform through a range of Community Development and ESG initiatives. This
represents a compelling investment opportunity for interested parties to fast
track a new mine development into production.

 

Together with its corporate advisors, Grant Samual and Zenith Capital, the
Company continues to advance its Corporate Development activities. Asiamet
remains committed to maximising value for shareholders through strategic
partnerships and corporate initiatives to secure the debt and equity financing
required to build the BKM Project.

 

Darryn McClelland, Chief Executive Officer, commented:

"It has been an extremely busy start to 2024 and the Asiamet team has been
fully engaged in advancing critical  operational, project financing, and
corporate development initiatives. Notably, significant milestones have been
met in the project financing process, with successful completion of bank
financial modelling and meeting key requirements in the bank approvals
process. Across various operational fronts we have also seen very considerable
progress.

In our strategy for engineering, procurement and construction workstreams, we
have prioritised early engagement with project execution partners, a move
aimed at enhancing project delivery efficiency. Details regarding the
appointments of BKM's delivery partners will be made over the next few weeks
and prior to the end of Q1 2024.

Additionally, we also anticipate completing the Biomass Power Station study by
the end of Q1 2024. As with any mining project, securing a power source is
paramount, and the proposed renewable energy source of Biomass Power Station
would also enhance the environmental sustainability of the BKM project. The
Company is particularly encouraged by substantial interest from potential
partners in financing the power plant, and we look forward to sharing further
details in due course.

On the corporate development front, we are experiencing elevated levels of new
interest in both our KSK and Beutong assets. Data room due diligence processes
and site visits for multiple parties are currently being facilitated.

When considering the forecast dynamics of the copper market fuelled by the
escalating demand for electrification, our Company's assets are cornerstones
of strategic value, comprising advanced projects endowed with high-quality
resources/reserves and a path forward to production. Furthermore, our projects
hold the potential of diversifying revenue streams through the extraction of
other base and precious metals upon reaching full development. The Board and
management remain highly committed to delivering value from our asset base for
all stakeholders."

 

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
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.sethi@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 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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