Mitrais, Member of CAC Holdings Group

Mitrais Mining Newsletter

September 2019 | Vol. 35


Mitrais Signed Partnership Cooperation Agreement with Datamine

August 30, 2019

It was great to sign a partnership agreement with Datamine! Mitrais has been selling and supporting MineScape in Indonesia and ASEAN for 28 years so we feel privileged that Datamine have renewed our agreement and look forward to providing value to them and our esteemed clients.

Mitrais signed partnership cooperation agreement with Datamine

Mitrais signed partnership cooperation agreement with Datamine

Source: Mitrais Release

Weekly News

Indonesia Digest: Cita Mineral Shareholder to Sell Stake; Bank Mitraniaga Delisting

August 19, 2019

Harita Jayaraya, the controlling shareholder of Indonesia’s bauxite mining company Cita Mineral Investindo, is reviewing a plan to sell minority stake to Glencore International Investments. Meanwhile, Bank Mitraniaga will be delisted from the Indonesia Stock Exchange (IDX) on August 23, following its merger with listed peer Bank Agris.

Cita Mineral Investindo’s Shareholder to Sell Minority Stake to Glencore

Harita Jayaraya, the controlling shareholder of Indonesia’s bauxite mining company Cita Mineral Investindo, is reviewing a plan to sell an undisclosed minority stake to Glencore International Investments, the global commodity trading and mining company, according to a stock exchange announcement.

Harita Jayaraya holds 90.96% stake in Cita Mineral, which equals 3.06 billion shares. The proposed minority stake sale will be subject to approval by concerned parties, including the government authority.

The stake sale is believed to bring advantage to Cita Mineral’s operational activities, legal, financial performance as well as the company’s business continuity, according to Lim Gunardi Hariyanto, director, Harita Jayaraya.

Bank Mitraniaga to delist from IDX following merger with Bank Agris

Indonesia’s Bank Mitraniaga will be delisted from the Indonesia Stock Exchange (IDX) following its merger with a listed peer Bank Agris, according to a stock exchange announcement.

The two banks are expected to receive a confirmation from the Ministry of Law and Human Rights on 22 August 2019, so that Bank Mitraniaga may be delisted on 23 August 2019.

Prior to delisting, one share of Bank Mitraniaga will be coverted into 1.137 share of Bank Agris on 22 August 2019.

The merger is conducted because the two banks are backed by Industrial Bank of Korea (IBK), respectively 95.79% in Bank Agris and 71.683% in Bank Mitraniaga.


Weekly News

Newcrest Ready to Divest Interest from Indonesian Asset

August 19, 2019

The move comes after the Joko Widodo government issued last year a mandate stating that major mines such as Gosowong or Freeport-McMoRan’s (NYSE:FCX) Grasberg have to be at least 51% owned by Indonesian companies.

“Newcrest’s 75% owned Indonesian subsidiary, PT Nusa Halmahera Minerals (PTNHM), entered into an agreement with the Government of Indonesia to amend the Gosowong Contract of Work (CoW). A key amendment to the CoW included a requirement that Indonesian parties own at least 51% of PTNHM within two years of signing the amendment agreement,” the report reads.

According to the Australian Financial Review, an auction for the interest in the $246-million asset is already underway and a transaction should be completed before the miner’s deadline to divest, which is set for June 2020.

Gosowong is located on Halmahera Island, about 2,450 kilometres northeast of the national capital, Jakarta. It is a gold (epithermal and epithermal – low sulfidation) deposit, with additional occurrences of silver.

Through the year ended on June 30, the underground operation produced 190,000 ounces of gold and generated $29 million in free cash.


Weekly News

Indonesian Coal Prices Flat as Tender Details Emerge

August 19, 2019

The Indonesian physical coal market made a typically slow start to the week, as details of cargoes awarded in a relatively large Chinese-state controlled utility tender late last week began to emerge.

Market participants are also monitoring the situation after Indonesian coal mining company Bayan Resources was late last week forced to declare force majeure on some shipments because low water levels on the Kedang Kepala river in Kalimantan are affecting its ability to transport cargoes by barge to waiting vessels. As many as 15 vessels may have been delayed by the low water levels, according to some market estimates.

Attention was also focused on Chinese state-owned utility Guodian, which issued a fresh tender today to buy a further 370,000t of imported, mostly low-calorific value (CV) coal for delivery to its power plants in south China’s Fujian province on 10-30 September. The tender closes tomorrow at 2pm Beijing time (06:00 GMT).

This follows closely on a Guodian tender that closed on 16 August seeking around 950,000t of various grades of coal, including low-CV Indonesian material, for the company’s Jiangsu power plants. The utility was heard to have awarded a cargo of NAR 3,400 kcal/kg (GAR 3,800 kcal/kg) Indonesian coal from this earlier tender at around 308.50 yuan/t ($43.80/t) cfr plus value added tax (VAT), which nets back to around $26/t. It was also heard to have awarded a geared Supramax cargo of NAR 3,800 kcal/kg (GAR 4,200 kcal/kg) Indonesian coal at Yn348/t cfr plus VAT, which nets back to around $31/t fob. Guodian may have also awarded a Panamax cargo of NAR 4,600 kcal/kg (GAR 5,000 kcal/kg) material at around $46/t fob.

The price at which the GAR 4,200 kcal/kg cargo was awarded in the tender was in line with transactions in the spot market late last week, when a September-loading geared Supramax shipment also changed hands at $31/t. September-loading geared Supramax GAR 4,200 kcal/kg cargoes were bid today at around $30.50/t, with offers at around $31.50/t.

The ICI 4 derivatives market made a slow start to the week after a total of 104,000t was cleared on the CME last week. September contracts were bid today at $30.90/t and offered at $31.75/t, while October was bid at $30.75/t and offered at $31.50/t. The last Argus-assessed price for September ICI 4 futures on 16 August was at $31.65/t, when October was assessed at $31.55/t.

Two trades were reported today in the market for Australian coal, with fob Newcastle NAR 6,000 kcal/kg coal changing hands in a $61.25-62.50/t range, well below the most recent Argus assessment of $64.28/t on 16 August.

One of the fob Newcastle NAR 6,000 kcal/kg cargoes for 90,000t sold on screen at $61.25/t for October loading. While this cargo fits the Argus index, a second October-loading cargo done a few hours later at $62.50/t for 25,000t was too small to be included in the index. Several offers emerged on screen for 75,000t cargoes – the first at $62.50/t fob Newcastle for October loading and the second at $64.75/t for November loading from the same port. Few bids were heard.

Both NAR 6,000 and NAR 5,500 kcal/kg Australian coal was well supplied, traders said, with Chinese buyers waiting on the sidelines to see whether Beijing would impose further import quotas in the months ahead.

But some buying interest emerged in the tender market for high-CV coal today, with Taiwan’s state-owned Taipower issuing a tender for 320,000t of coal with a minimum gross CV of 6,200 kcal/kg, maximum ash of 14pc and sulphur not exceeding 0.7pc. The coal can be supplied from Australia, Canada, China, South Africa, the US and Venezuela. The deadline for receiving bids is 5pm on 28 August in Taipei (10:00 GMT).


Weekly News

Indonesian Physical Coal Prices Under Pressure

August 20, 2019

There were further signs that low-calorific value (CV) Indonesian coal prices were coming under pressure, with details starting to emerge that a September-loading GAR 4,200 kcal/kg cargo may have traded at a lower price compared with recent similar deals.

Bids and offers for GAR 4,200 kcal/kg coal were little changed compared with yesterday, with bids at around $30.50/t for geared supramax cargoes and offers at around $31.50/t. But details began to emerge that a September-loading supramax cargo may have traded at the lower price of around $30.40/t.

By comparison, a deal involving a supramax GAR 4,200 kcal/kg shipment was done late last week at $31/t. Argus last assessed this market on 16 August at $31.19/t, down by 90¢/t from the previous week and the lowest since early January.

Trade was muted in the ICI 4 derivatives market, with details of fresh deals slow to emerge after a total of 104,000t was cleared on the CME last week. September ICI 4 contracts were bid today at $30.90/t and offered at $31.50/t, lower than the last Argus settlement price for this month yesterday at $31.55/t. October contracts were bid today at $30.75/t and offered at $31.50/t, which again was lower compared with yesterday’s Argus October settlement price, also was also at $31.55/t.

The Australian market also appears to be softening amid ample supplies.

A 75,000t October-loading cargo of fob Newcastle NAR 6,000 kcal/kg coal was bid at $59/t and offered at $63/t on screen.

That bid-offer range was broadly in line with yesterday’s index-relevant trade at $61.25/t fob Newcastle for an October-loading 90,000t cargo, but was lower than the most recent Argus assessment of $64.28/t on 16 August.

A fourth-quarter loading 25,000t clip was also bid and offered on screen at $61.08-66/t fob Newcastle, with a 25,000t clip loading in the second quarter of 2020 traded at a 25¢ discount to the GlobalCoal index. But these specifications are irrelevant to the Argus index.

Chinese demand in the NAR 5,500 kcal/kg market was subdued, while there was an offer at $49/t fob Newcastle for a September-loading Capesize or Panamax cargo. That was down from last week’s assessment of $49.49/t fob Newcastle.

Indian buyers have started to step into the market, possibly to capitalise on the lower prices, bidding $47/t fob Newcastle for a September-loading NAR 5,500 kcal/kg Panamax cargo.

China’s domestic coal market was stable for a second straight day. Offers of NAR 5,500 kcal/kg domestic coal were around 580-585 yuan/t fob north China ports compared with around Yn580/t late last week. Bids were around Yn575-580/t fob.

Futures prices responded more actively to a fall in stocks at Chinese coastal utilities, which reached a two-month low of 16.4mn t yesterday. The September contract on the Zhengzhou commodity exchange closed at Yn591.20/t today, up by Yn5.40/t from yesterday.


Weekly News

Asiamet and China NFC Agree on EPCM Services for BKM Project

August 21, 2019

Asiamet has signed a memorandum of understanding (MoU) with China Nonferrous Metal Industry’s Foreign Engineering and Construction (China NFC) to develop the Beruang Kanan Main (BKM) Copper project.

China NFC will provide engineering, procurement and construction management (EPCM) services for the project, which is located in Central Kalimantan, Indonesia.

The company will undertake a detailed evaluation of the technical and financial aspects, as well as propose a set of solutions to Asiamet with respect to the EPCM components of the mine development.

Services provided by China NFC will include front-end engineering design (FEED), equipment capital items, and facilities arrangement.

The procurement services will include establishment of tender process and documents, while construction services include contractors’ management for the construction phase and commissioning of work packages.

According to Asiamet, financing will be part of the project management services provided by China NFC.

Asiamet executive chairman Tony Manini said: “The signing of this MoU with China NFC represents an important strategic milestone for Asiamet and we are extremely pleased to have the opportunity to work with one of China’s leading mining, processing and contracting companies on the next stage of development of the BKM project.

“Despite recent market volatility, supply-demand fundamentals for copper remain strong and while we still have a number of key engineering, financing and permitting milestones in front of us prior to commencing mine construction, the signing of this MoU and the initiation of the value engineering phase clearly demonstrates our ongoing commitment to developing the BKM copper project in the shortest timeframe possible.”

In a separate announcement, the company has raised $2.1m, which will be used to fund value enhancement initiatives outlined in the recently completed BKM Feasibility Study.

In March, Asiamet also received two key approvals from the Indonesian government for its wholly-owned BKM copper project.


Weekly News

Indonesia's May Thermal Coal Exports Rises 6% on Month; Exports to China Highest Since Jan 2014

August 20, 2019

Indonesia exported 30.6 million mt of thermal coal in May, up 6% on the month and up 20% on the year, according to latest customs data.

Sub-bituminous coal accounted for 86% of overall coal exports, or 26.4 million mt, with bituminous representing the rest.

India was the largest destination, taking 10.3 million mt, down 8 % on the month, but up 3% on the year. High Indian domestic stockpiles and seasonal monsoon had dampened some seaborne buying interest in May.

Exports to China were 7.2 million mt in May, the highest since January 2014. The export figure was up 57% from April and increased more than one fold compared with a year ago.

An earlier than usual summer restocking and active Chinese tenders for Indonesian low-mid calorific value thermal coal cargoes offered support for seaborne demand and prices. Coupled with the reduction in the value added tax to 13% from 16%, exports to China were seen at a five-year high.

Outside these main markets, exports to other destinations stood 8.5 million mt. The majority of these volumes were to Southeast Asian countries, notably Thailand, Philippines, Vietnam, and Malaysia.


Weekly News

Low-CV Indonesian Coal Prices Hold Steady

August 21, 2019

Fob prices for low-calorific value (CV) Indonesian coal held relatively steady as some market participants said that the market may be starting to stabilise.

Most bids and offers for GAR 4,200 kcal/kg product were flat to slightly firmer today, with September-loading geared Supramax cargoes bid at around $30.50-31.50/t and offered at around $31.50-32.00/t. This compares with bids at $30.50/t and offers at $31.50/t yesterday.

Details of firm transactions were slow to emerge, although a September-loading Supramax may have traded at $30.50/t, up slightly compared with a similar trade yesterday at $30.40/t. A Panamax cargo loading in late September-early October, which would typically trade at a premium of around $0.50-1.00/t to Supramax cargoes, was heard to have traded at $31.50/t, while a trader was bidding for a late September-loading Panamax cargo at $31.25/t.

Trade was also muted today in the ICI 4 derivatives market after a total of 104,000t was cleared on the CME last week. September contracts were bid today at $30.80-31.00/t with different Singapore-based brokers and offered at $31.45-31.50/t. Yesterday’s Argus prompt month closing swap was at $31.30/t.

First-quarter 2020 contracts were bid today at $33.15/t and offered at $34.15/t, broadly in line with yesterday’s Argus settlement price at $33.60/t. First-half 2020 contracts were bid at $33.90/t and offered at $34.20/t.

In the Australian NAR 5,500 kcal/kg market, at least three trades were heard to have been done at $49/t fob Newcastle for September-loading Capesize cargoes going to China, although these deals were not confirmed. Bids were also heard around $47-48/t fob Newcastle for September and October-loading Capesize shipments. The NAR 5,500 kcal/kg market was most recently assessed by Argus at $49.49/t fob Newcastle on 16 August, but market participants believe it could have slipped to as low as $48/t this week.

In the Australian NAR 6,000 kcal/kg market, a 25,000t October-loading clip traded on screen at $62.65/t fob Newcastle. A first-quarter of 2020-loading 25,000t clip traded on screen at a 60¢/t discount on an index-linked basis.

In the Chinese domestic market, coal prices were showing signs of stabilising following consecutive week-on-week falls since 5 July. Offers of NAR 5,500 kcal/kg coal were at 580-585 yuan/t fob north China ports, while bids were around Yn580/t. This compares with Argus’ last assessment of Yn579.17/t ($82.01/t) fob Qinhuangdao on 16 August.

In China’s futures market, the September contract on the ZCE closed at Yn586.20/t today, down by Yn5/t from yesterday.


Weekly News

East Asia CEO Sells Shares to Facilitate Obtaining the Production Licence

August 21, 2019

Share Sale by Terry Filbert CEO and Chairman

East Asia Minerals (“the Company”) advises that in order to maintain the momentum on completing the Sangihe Production License approval, CEO Terry Filbert has recently elected to sell shares and loan the net proceeds to the company in order to pay expenses that are necessary in the final stages of the production license approval for the Sangihe project.

Sangihe Project

The Sangihe gold-copper project is located on the island of Sangihe off the northern coast of Sulawesi and has an existing National Instrument 43-101 inferred mineral resource of 114,700 indicated and 105,000 inferred ounces of Gold. The Company’s 70-percent interest in the Sangihe-mineral-tenement contract of work (“CoW”) is held through PT Tambang Mas Sangihe (PTTMS). The remaining 30-percent interest in PTTMS is held by three unaffiliated Indonesian corporations. The term of the Sangihe CoW agreement is for 30 years upon commencement of the production phase of the project.


On behalf of the Board of Directors of East Asia Minerals,

Terry Filbert,
Chairman & CEO


Weekly News

Successful Placing of Approximately US$ 2.1 Million

August 20, 2019

Asiamet Resources Limited (“Asiamet” or the “Company”) is pleased to announce that it has today successfully placed a total of 50,000,000 new common shares of par value US$0.01 each in the Company (the “Placing Shares”) at a price of 3.5 pence per share (the “Issue Price”) raising gross proceeds of approximately £1,750,000 million (US$2,124,000 million) (the “Placing”).

Proceeds of the Placing will be utilised to fund a number of the value enhancement initiatives outlined in the recently completed BKM Feasibility Study (see release dated 14 June 2019), to continue stakeholder engagement programs (government, business and community) and permitting in preparation for development of the BKM project, undertaking initial metallurgical test-work on mineralisation from upper parts of the Beutong deposit, and to continue progressing options for funding the ongoing development of both the BKM and Beutong projects.

Peter Bird, CEO of Asiamet Resources commented:

“We are very pleased with the support received both from existing as well as new investors. The completion of this financing allows us to commence a number of the more significant value enhancement initiatives identified in the BKM BFS, including drilling some of the highest priority targets for additional copper Resources located nearby the proposed BKM mine development.

We also plan to initiate a metallurgical test-work programme on samples from the upper parts of the Beutong deposit to test the amenability of the mineralisation for heap-leaching and hence the potential for alternative development options. Progressing the permitting and funding options for BKM and Beutong continues to be a key focus of the management team and we look forward to providing regular updates on all workstreams as they are being progressed.”

Placing Details and Total Voting Rights

Optiva Securities acted as lead bookrunner in relation to the Placing.

The Company has successfully placed 50,000,000 Placing Shares raising gross proceeds of approximately £1,750,000 million (US$2,124,000 million).

The Placing is conditional upon, inter alia, Admission of the Placing Shares to trading (which will be issued and settled in CREST to the extent possible) on AIM. Application will be made for Admission, which is expected to occur by 8.00 a.m. on 30 August 2019 (“Admission”).

Following Admission, the Company’s issued ordinary share capital will comprise 1,095,960,742 common shares. From Admission, the figure of 1,095,960,742 may be used by Shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA’s Disclosure Guidance and Transparency Rules.

Note: for the purposes of this announcement figures have been calculated based on an exchange rate of US$1.21=£1.00

Director Participation

Mr Bruce Sheng a director of Asiamet Resources and Chairman of ASIPAC Group participated in the Placing through ASIPAC Group and agreed to subscribe to 3,371,686 Placing Shares at the Placing Price.

On Admission, the shareholdings of the ASIPAC Group will continue to constitute a significant shareholding for the purposes of the AIM Rules for Companies and be as follows:

Director Holding of Common Shares Percentage of Enlarged Share Capital
ASIPAC Group 73,904,720 6.74%


Peter Bird, CEO


Weekly News

Asiamet Signs MoU with China Nonferrous Metals

August 21, 2019

Asiamet (“ARS” or the “Company”) is pleased to announce it has signed a Memorandum of Understanding (MoU) with China Nonferrous Metal Industry’s Foreign Engineering and Construction Co., Ltd (China NFC), a subsidiary of China Nonferrous Metal Mining (Group) Co., Ltd. for value engineering and Engineering, Procurement and Construction Management (EPCM) Services for the BKM Copper project located in Central Kalimantan, Indonesia.

China NFC is a market leading Chinese contracting group with an internationally recognised capability, having successfully completed many mine developments across the Middle East, Central and North Asia, Central and South Africa, and neighbouring countries. These implementation capabilities in nonferrous metal industry projects cover a wide range from technical assistance, technical consultancy, equipment manufacturing and supply to project management, project implementation and financing.

Of particular relevance to Asiamet, China NFC together with its Indonesian partners is currently building the Dairi Zinc Mine in North Sumatra, Indonesia and actively working to expand its presence in the country.

As part of the proposed engagement with Asiamet, China NFC will undertake a detailed evaluation of the technical and financial aspects of the BKM copper project and propose a series of solutions to the Company with respect to the value engineering and EPCM components of the proposed BKM mine development. Utilising a China and local Indonesian-Southeast Asian sourcing strategy is expected to lower some of the BFS capital cost inputs and enhance overall project economics. The potential to access China NFC’s strong linkage’s with Chinese capital providers and project and equipment financiers will be explored in detail as part of this engagement.

Asiamet intends to work with China NFC to further enhance the value of the BKM copper project through the provision of services in the following key areas:

·  Engineering and Design, including value engineering, front-end engineering design, development of schedules, budgets and work packages for major plant and equipment capital items, facilities arrangement;
·  Procurement, including establishing tender process and tender documents, managing supplier interface;
·  Construction, including management of contractors for construction phase, reporting and commissioning of work packages; and
·  Project Management, including potential sources of project finance.

About China NFC

China Nonferrous Metal Mining (Group) Co., Ltd. is principally engaged in the mining and smelting ofnon-ferrous metals, with a strong international project contracting capability including mining and public infrastructure projects such as housing, civil buildings, roads and bridges and electrical power.

China NFC’s implementation capabilities in nonferrous metal industry projects cover a wide range from technical assistance, technical consultancy, equipment manufacturing and supply to project management, project implementation and financing. With an excellent design team, advanced equipment manufacturing, a highly experienced construction team and a well-established industrial projects management process, this places China NFC at the forefront of project contracting. China NFC applies world-leading technologies with Chinese adaptation to nonferrous metal projects it has been involved with. Great success has been achieved in nonferrous metal mining, beneficiation and smelting projects, with China NFC making significant contributions to complex projects across the Middle East, Central and North Asia, Central and South Africa, and neighbouring countries.

Tony Manini, Asiamet’s Executive Chairman commented:

“The signing of this MOU with China NFC represents an important strategic milestone for Asiamet and we are extremely pleased to have the opportunity to work with one of China’s leading mining, processing and contracting companies on the next stage of development of the BKM project. Engaging the services of such a highly credentialled Chinese Company to provide support for the value engineering phase is expected to enhance the overall economics and executability of the BKM project and provide access to a wider investor network in Asia.

Despite recent market volatility, supply-demand fundamentals for copper remain strong and while we still have a number of key engineering, financing and permitting milestones in front of us prior to commencing mine construction, the signing of this MOU and the initiation of the value engineering phase clearly demonstrates our ongoing commitment to developing the BKM copper project in the shortest timeframe possible. We look forward to providing further updates as we continue to advance the BKM project towards production.”


Peter Bird, Deputy Chairman and CEO


Weekly News

Cakra Mineral Plans to Take Corporate Action

August 23, 2019

PT Cakra Mineral Tbk (CKRA), an iron ore mining company, plans to take corporate action in order to maintain its business entities.

According to the disclosure of company information, Dexter Sjarif Putra, Director of PT Cakra Mineral Tbk (CKRA) said the company is focusing on the feasibility study for the corporate action. This statement was released in response to the IDX’s request for information regarding the company’s operational continuity after its delisting 24 months ago

For information, the company has requested financing from Exim Bank of China for the construction of its new smelter. The company has also received equipment offers from Topsun International Industrial Limited for the smelter.


Weekly News

Adaro Generated US$ 1.7 Billion in Revenue in 1H 2019

August 23, 2019

PT Adaro Energy Tbk (ADRO) generated US$ 1.7 billion in revenue in the first semester (1H) of 2019, higher than its record from the same period of last year of US$ 1.6 billion.

Meanwhile, the company’s profit in the first semester of 2019 reached US$ 321 million, also higher than its record from the same period of last year of US$ 244 million.

“Our business model has proven to be resilient in dealing with the cyclicality of this industry and enables companies to manage the market in the short term,” said President Director and Chief Executive Officer at ADRO, Garibaldi Thohir, in a press release on Thursday (22/8).

Adaro Energy recorded a solid operational EBITDA of US$ 691 million, increased by 17% YoY, and maintained a high operational EBITDA margin of 39%. This is in accordance with EBITDA guidelines for one year, which range from US$ 1 billion to US$ 1.2 billion.

Meanwhile, royalties paid to the state rose by 12% YoY to US$ 189 million due to an increase in operating revenues. Adaro Energy continues to make positive contributions to the country’s development and comply with applicable tax regulations.


Weekly News

Antam to Raise Gold Production to 32 Tonnes

August 22, 2019

PT Aneka Tambang (Persero) Tbk (ANTM) or Antam will increase its gold production to 32 tonnes amid the continues increase of the commodity’s prices.

Antam CEO Arie Prabowo Ariotedjo said that this year the company has been planning to raise its gold production to 32 tonnes or more.

“Our current production target is above three tonnes of precious metals. We have raised our [gold] target to 32 tonnes, and hopefully we can reach 36 tonnes,” said Mr Ariotedjo at the IDX Building, Wednesday (21/8).

Mr Ariotedjo added that Antam’s gold production has been rising recently, having reached 15.4 tonnes as of the first half of 2019. However, he maintains that rising gold prices will hardly stabilise and thus there is no guarantee that it will benefit the company. “There are shocks due to the ongoing US-China trade war,” he asserted.

The Comex gold price for the December 2019 contract today rose to US$ 1,518.40 per troy ounce. Mr Ariotedjo predicts that in the long term the global gold price will remain at US$ 1,40p per troy ounce.


Weekly News

Antam Partners Chinese Companies to Build US$ 7.2 Billion Smelters

August 22, 2019

PT Aneka Tambang Tbk (ANTM) or Antam will partner Chinese companies to build five smelter projects worth US$ 7.2 billion. The five smelters will be used to process aluminiums, blast furnaces, ferronickels, stainless steel, and cobalt for battery manufacturing.

Antam CEO Arie Prabowo Ariotedjo said that the first project is an aluminium smelter in Mempawah, West Kalimantan with an investment value of US$ 900 million. The project’s groundbreaking is targeted to take place in September.

Antam will partner with a Chinese company called Shandong Xinhai to develop the smelters, with the locations still bein reviewed. There are two potential locations, namely Sorong, West Papua and Halmahera, Maluku.

“We have completed a tender project in the EPC (engineering, procurement, and construction) phase, we have opened a price, and we now need some more negotiations. We hope it will be finalised this month with the groundbreaking taking place in September,” said Mr Ariotedjo at the IDX Building, Wednesday (21/8).

In addition, the blast furnace project is currently in the financial closing phase with a first-stage investment value of US$ 90-100 million. Blast furnaces are normally used to chemically reduce and physically convert iron ore.

For the cobalt smelter, Antam will partner its parent company PT Inalum (Persero) with a joint stock investment of 51% and an approximate investment value of US$ 6 billion. Mr Ariotedjo added that Antam has signed a head of agreement (HoA) with another Chinese company called Huayou Cobalt Company Ltd.


Weekly News

Antam Present Latest Corporate Performance During The Public Expose Live 2019

August 23, 2019

PT Aneka Tambang Tbk (ANTAM; IDX: ANTM; ASX: ATM) is pleased to announce that the Company has presented the latest corporate performance, strategy, and outlook during the Public Expose Live 2019. The event was held by the Indonesia Stock Exchange (IDX) on August 21, 2019.

ANTAM’s President Director, Arie Prabowo Ariotedjo said:

“ANTAM’s participation at the Public Expose Live 2019 is Company’s strategy to present the latest corporate performance, strategy, and outlook to shareholders. We expect the presentation will be referred by the investors and potential investors to invest in ANTAM’s shares. ANTAM committed in completion of downstream minerals development projects to provide positive returns to our shareholders.”

In the first half of 2019 (1H19), ANTAM’s unaudited net sales reached Rp14.43 trillion, grew 22% compared to audited net sales figure in first half of 2018 (1H18) of Rp11.82 trillion. Positive performance of ANTAM’s operations and sales of Company’s main commodity in 1H19, also reflected of unaudited production volume of ferronickel reached 13,017 of nickel contained in ferronickel (TNi), a 2% increase compared to ferronickel production level in 1H18 of 12,811 TNi. Along with the rise on production volume, unaudited ferronickel sales in 1H19 reached of 13,157 TNi, a 5% growth compared 1H18 of 12,579 TNi. In 1H19, ferronickel sales was the second largest contributor to ANTAM’s unaudited net sales, amounting to Rp2.31 trillion or 16% of the unaudited net sales.

For gold commodity, in 1H19 unaudited production volume of gold from Pongkor and Cibaliung Mine reached 979 kg (31,476 t.oz). Meanwhile, ANTAM’s unaudited gold sales in 1H19 reached 15,741 kg (506,084 t.oz), a 14% increased than gold sales volume in 1H18 which amounted to 13,760 kg (442,394 t.oz). The increased of ANTAM’s gold sales aligned with ANTAM’s strategy on market development for both domestic and overseas market as well as innovation on ANTAM’s Logam Mulia product. Gold as the largest contributor of ANTAM’s revenue, amounting to Rp9.61 trillion or 67% of total 1H19 unaudited net sales.

For nickel ore commodity, unaudited production volume of nickel ore in 1H19 amounted to 4.79 million wet metric ton (wmt), or increase up to 27% compared to 1H18 of 3.77 million wmt. Meanwhile, unaudited nickel ore sales volume of 3.90 million wmt, increased by 103% compared to nickel ore sales volume in 1H18 of 1.92 million wmt. ANTAM’s unaudited revenue from nickel ore amounted to Rp1.76 trillion in 1H19, a 107% growth compared to nickel ore sales revenue in 1H18 of Rp849 billion.

In addition, bauxite commodity also delivered positive contribution for ANTAM during 1H19 period. In 1H19, ANTAM unaudited recorded bauxite production of 597 thousand wmt, growth by 43% compared to 1H18 production volume of 417 thousand wmt. Meanwhile unaudited bauxite ore sales during 1H19 reached 611 thousand wmt, growing by 138% compared to 1H18 sales level of 257 thousand wmt. The 1H19 unaudited revenues from the sales of bauxite were recorded at Rp297 billion. Inline with the operational continuity of Tayan Chemical Grade Alumina (CGA) Plant, during 1H19 period, as much as 43,631 ton alumina (unaudited) was produced and amounted of 25,674 ton alumina (unaudited) has sold to the customer.

As an implementation of Company’s business expansion strategy through mineral downstream processing project, ANTAM currently conducts the construction phase of East Halmahera Ferronickel Plant Development Project (P3FH) with production capacity of 13,500 TNi (Line 1). Until the end of June 2019, the construction progress reached 97% and is planned to be effective in 2020. For bauxite development project, ANTAM is currently focusing on the development of Smelter Grade Alumina Refinery (SGAR) plant with PT INALUM (Persero) as Mining Industrial Holding. SGAR plant will have annual SGA production capacity of 1 million ton SGA per annum (Stage 1).

ANTAM’s positive share performance was reflected from the number of investors trading of ANTAM’s shares. Until July 2019, ANTAM’s total investor reached 52,182 investors, increased by 11% compared to the total investors at the end of 2018 of 47,085 investors. ANTAM’s shares were also actively traded in IDX. Until July 2019, ANTAM closing share price reached Rp935 per share, increased by 22% compared to the closing price at the end of 2018 which amounted to Rp765 per share. In July 2019, the average traded shares reached 98.17 million shares with the average daily trading value of Rp88.53 billion. Moreover, ANTAM’s shares remains part of LQ45 Index, IDX30 Index, IDX80 Index, IDX Small-Mid Cap (SMC) Composite Index, IDX SMC Liquid Index, PEFINDO Investment Grade (i-Grade) Index, Jakarta Islamic Index, Jakarta Islamic Index 70, Kompas100 Index, IDX BUMN20 Index, MNC36 Index and Bisnis-27 Index which is the list companies with the highest liquidity at the IDX.


Weekly News

Indonesia H1 Biodiesel Output at 4.22 mln KL, Coal Output at 285 mln T -ministry

August 23, 2019

*  Indonesia produced 4.22 million kilolitres (KL) of biodiesel in the January-June period, data from the energy ministry showed on Friday. The government is targeting 7.37 million KL of biodiesel production this year

*  A ministry official said last month the country consumed 2.89 million KL of biodiesel in the first semester, while a biodiesel industry group said consumption reached 3.24 million in the same semester

*  In the first semester, Indonesia also produced 285 million tonnes of coal, versus a full-year target of 489 million, the data showed

*  Coal output this year may reach 600 million tonnes, the energy ministry’s director general for minerals and coal, Bambang Gatot Ariyono, told reporters on Thursday

*  The domestic market consumed 57 million tonnes of coal in the first semester


Weekly News

Harmony Hunts for Deals Amid Depleting South Africa Reserves

August 20, 2019

Harmony Gold Mining Co. is assessing the acquisition of new assets, including AngloGold Ashanti Ltd.’s last underground operation in South Africa, as it seeks to replace depleting reserves.

While gold output rose 17% in the year through to June, Harmony needs new capacity as its South African mines run out of viable ore and a project in Papua New Guinea stalls amid regulatory challenges, said Chief Executive Officer Peter Steenkamp. The Mponeng mine being sold by AngloGold is one “opportunity,” but the company is also looking for deals across Africa, Australia and Southeast Asia, he said.

“We are constantly, constantly looking at opportunities in those three regions,” Steenkamp said in an interview on Tuesday. Indonesia and Ghana are two countries of particular interest, he said, even though no projects have been identified yet.

Harmony is still heavily dependent on South Africa, where the gold industry is shrinking amid the geological challenges of exploiting the world’s deepest mines. Potential deals in its home country are complicated by government rules intended to redistribute the benefits of mining more widely to make up for racial discrimination during apartheid, the CEO said.

“Harmony will be operating in South Africa for a very long time,” Steenkamp said. “We are not against any investment in South Africa provided it matches our criteria and we can make money out of it.”

Papua Policy

Production in the last fiscal year was boosted by Moab Khotsong, a South African mine it previously bought from AngloGold, and its existing Hidden Valley operation in Papua New Guinea. Harmony expects its output to be little changed at 1.46 million ounces in the current financial year.

The company is looking at operations that produce more than 100,000 ounces a year at an average cost of $950 an ounce, Phillip Tobias, chief operating officer for new business development, said on a conference call.

“You need to find the right combination of reserves that will have the right impact for your company,” Steenkamp said.

The CEO said there’s no timetable for when work will resume on the $5.4 billion Wafi-Golpu mine as he only expects talks about the project to restart once Papua New Guinea has finalized discussions with Total SA over its liquefied natural gas joint venture. The project has been in limbo since a new government, led by Prime Minister James Marape, swept to power in May pledging to get better resource deals for the country.


Weekly News

Indonesian Ban on Ore Exports to Cause Remarkable Impact

August 22, 2019

It was reported that Indonesia will no longer export raw ores in 2022, and its purpose was to attract investment in the smelting industry, according to the Indonesian Minister of Energy and Mineral Resources.

The distribution of nickel mines in Indonesia was highly concentrated. The data showed that the reserve of Indonesian nickel mine was about 1.37 billion tons. Indonesian local mines were unable to conduct in-depth exploration due to funding problems.

In the short term, Indonesian nickel mines were still sufficient; in the long run, Indonesian nickel mines supply might be in short supply, depending on local conditions.

To sum up, the ban time was subject to the announcement of the Indonesian government. However, from the perspective of existing quotas, Indonesian nickel mines can be exported at least until 2020. If the time was advanced, due to the short storage period of the market, it will have a great impact on the supply chain from China.


Weekly News

PT Star Energy Plans to Expand Its Geothermal Capacity in Indonesia by More than 300 MW by 2028

August 19, 2019

With development of two geothermal projects in Malaku and Southern Sumatra, PT Star Energy plans to expand its current geothermal power generation capacity of 875 MW to 1,200 MW by 2028.

PT Star Energy continues to develop Geothermal Power Plants (PLTP). Just so you know, Star Energy is a subsidiary of Prajogo Pangestu’s Barito Pacific.

Hendra Soetjipto Tan, Chief Executive Officer of Star Energy Geothermal, Hendra Soetjipto Tan said that the company plans to increase the capacity of the power plant to 1,200 MW.

He said that they now have a capacity of 875 MW of electricity obtained from geothermal power plants from the Wayang Windu, Derajat and Salak geothermal working areas, West Java.

The capacity of 227 MW from PLTP Wayang Windu, then 377 MW in Salak, and amounting to 271 MW in Darajat. In addition, Star Energy also has the right to manage Hamiding geothermal energy in West Halmahera, South Maluku, and Sekincau geothermal in southern Sumatra.

In the plan to increase capacity, he continued, the company will build a geothermal power plant in Sekincau with a potential capacity of 500 MW, while in South Maluku as much as 200 MW to 300 MW.

“We hope that the 1,200 MW has been reached before 2028, three regions in West Java are already operating,” he said in Jakarta today.

However, the development in geothermal power plants in Maluku will be built in stages, the first phase they plan to build with a capacity of 2×50 MW. To reach the target capacity of 1,200 MW, they need funds of US $ 2 billion to US $ 2.5 billion.

For information, PT Star Energy acquired Darajat and Salak geothermal power plants with a capacity of 610 MW in 2017. The two new assets of Star Energy were bought from Chevron Corp with a transaction of US $ 2.3 billion.

After the acquisition, Star Energy became the manager of the largest geothermal power plant in Indonesia, and the third largest in the world. Star Energy aims to become the largest geothermal company in the world.


Weekly News

Bangladesh, Pakistan Capacity Additions Fuel Seaborne Thermal Coal Demand

Seaborne thermal coal demand is set to grow in the near to medium term in South Asia as Bangladesh and Pakistan add more coal-fired power plants to cater for their growing populations.

The first shipment of about 20,000 mt of Indonesian 5,050 kcal/kg GAR grade thermal coal is expected to arrive in the first two weeks of September for a new coal-fired power plant in Bangladesh, a source familiar with the matter said.

“It is only a small volume as the plant is running checks for the unit,” the source said.

The coal will be supplied to Bangladesh-China Power Company Limited for its Payra power plant in Patuakhali, southern Bangladesh.

BCPCL is a joint venture formed by Bangladesh’s North West Power Generation Company Limited and China National Machinery Import & Export Corporation in October 2014.

The first unit of the 1,320 MW power plant is likely to start production in December, said the source.

The plant is expected to take around 4 million mt/year of coal, and the utility is exploring other thermal coal imports from Indonesia as well as Australia in future for blending purposes, the source added.

Market sources said the shipment should be the first for the power plant there, as previously Bangladesh thermal buyers procured cargoes mainly for industrial purposes, including brick making.

“The procured cargoes are usually not big as sometimes a few buyers will share the shipments too,” said an Indonesia-based supplier.


Indonesian producer Bayan Resources signed its first long-term coal supply contract with BCPCL in June.

The agreement has an initial 10-year term from the date of commencement of delivery, expected in June 2020, to supply 23 million mt for the period, Bayan stated.

With expected economic growth, the Bangladeshi government has been targeting long-term energy diversification, as the country mainly depends on domestic supply of natural gas.

Coal accounted for 4% of the energy mix in 2014 and is expected to reach 20% by 2041, according to Bangladesh Power System Master Plan 2016, with annual growth rate of 12.7% per year. Imported coal was projected to reach 60 million mt/year in 2041, the report stated.

The country imported about 9.8 million mt of coal in 2014, according to the 2016 Master Plan, with more recent official import data not available.

“Demand in South Asian countries like Bangladesh and Pakistan is set to grow in [the] coming years, but the growthmight not be sufficient to absorb the oversupply … in the market,” said a Singapore-based market source.

“Bangladesh is at an earlier stage of growth than Pakistan in terms of energy development,” S&P Global Platts Headof Coal Analytics Joe Aldina said.

He added that even if imports from Pakistan and Bangladesh rise strongly as projected, there are concerns that slowing coal demand growth in China and a clear desire to use domestic production will weigh overall on seaborne coal markets.

Another Singapore-based analyst added that the South Asian market will also see competition from South African thermal coal suppliers, which might have a freight advantage due to the geographical proximity.


Pakistan imported 10.5 million mt of thermal coal in 2018, according to UN Comtrade data, and this figure has beenforecast to rise to more than 20 million mt/year by 2020, and as high as 30 million mt/year by 2022-2024, when most of the power projects are expected to be completed.

Pakistan’s 1,320 MW coal-fired power project by China Power Hub Generation Company is now operational, the government website states.

The plant will require about 4 million mt of thermal coal per year, which will imported from South Africa and Indonesia, according to the company website.

This follows the trend of Pakistan’s two other power plants which burn imported coal – the Port Qasim power station and the Sahiwal power station – both with a nameplate capacity of 1,320 MW.

As well as these projects, several power plants are being constructed around the country’s Thar coalfield, which produces mainly lower-grade thermal coal and lignite.

Aldina added that most of the power plants in Pakistan have been designed for Indonesian coal, but buyers could source for coal from other destinations for blending.

“South Africa has had to sell into India and Pakistan and other places since they cannot place much coal into Europe,” he said.

For other coal producers, the additional demand from South Asia will likely open up new markets in years to come.

“It is not easy to enter into these markets, and new entrants will need time to build connections, but it is stilla positive sign, which means there will be new export markets for us,” an Indonesia-based supplier said.


Weekly News

Japan Is Exporting The Most Polluting Kind of Coal Power to Developing Asia

Coal colonialism: Japanese-financed coal power plants in developing Asia emit up to 40 times more pollution than plants built in Japan, a study by Greenpeace has found.

Japan is financing coal-fired power plants in developing Asia that are up to 40 times more polluting than facilities built on home soil, and could cause more than 400,000 people to die prematurely in countries already suffering from bad air quality.

Japan-financed coal plants in countries including India, Indonesia, Vietnam, and Bangladesh emit up to 13 times more nitrogen oxide, 33 times more sulphur dioxide (SO2), and 40 times more dust than those built in Japan, according to a new report, A Deadly Double Standard, released on Tuesday by non-government organisation (NGO) Greenpeace.

Japan’s public finance agencies pumped US$16.7 billion into coal projects in countries with low emissions standards between January 2013 and May 2019, which Greenpeace estimates could cause between 148,000 and 410,000 premature deaths.

India—already home to the world’s filthiest air—will suffer the most from Japan’s coal exports due to long-term exposure to fine particulate matter and nitrogen dioxide pollution, followed by Indonesia, Vietnam, and Bangladesh. An estimated 160,000 people in the sub-continent could die prematurely due to Japanese investments, said Greenpeace.

The public finance agencies named in the report were the Japan Bank for International Cooperation, Nippon Export and Investment Insurance and Japan International Cooperation Agency. For certain projects, there was also additional financing from Japan’s three largest private banks: Mitsubishi UFJ Financial Group, Mizuho Financial Group and Sumitomo Mitsui Banking Corporation, the NGO added.

“It’s unfortunate to see the gap between Japan’s promises of exporting quality infrastructure and the reality of low-quality coal technology exports,” commented Hanna Hakko, senior energy campaigner at Greenpeace Japan.

“Japan should honor its trading partners and citizens of those countries by promoting energy technologies that stop hurting people’s health and the environment,” she said.

Greenpace called on the Japanese Government to immediately stop its public finance agencies from investing in overseas coal power plants for which emission limits do not meet the standards applied in Japan.

Though cheap and abundant, coal is the single biggest contributor to climate change, responsible for almost half the world’s carbon dioxide emissions.

Japan is the only G7 country still building new coal power plants at home and abroad, and is the second largest public investor in overseas coal projects among the G20 countries—after regional rival China.

Japan’s powerful banks have started to respond to continued pressure to quit coal. Mitsubishi UFJ Financial Group, one of the world’s biggest funders of the fossil fuel, announced in May that it would stop funding new coal plants. Soon after, rival Mizuho tightened its climate policy to exclude the financing of low-grade, highly polluting coal projects.

Greenpeace’s study emerges in the same week that the NGO released another report that ranks countries by SO2 emissions, a major byproduct of coal power, using data from the United States’ National Aeronautics and Space Administration.

India ranked first, contributing more than 15 per cent of global man-made SO2 emissions. Greenpeace attributed India’s high SO2 emissions to the expansion of coal-based electricity generation over the last decade.

Most Indian coal-fired power plants lack the technology to reduce air pollution, known as flue-gas de-sulphurisation (FGD), the report noted. For this reason, India has overtaken China in the sulphur pollution ranking.

China’s air quality has improved significantly after it installed FGD systems across the electricity generation sector and made major investments in renewable energy. However, the country remains the world’s third-largest emitter.


Weekly News

Coal to Retain Dominance in Indonesia Despite Push for Renewables

Coal to remain dominant in power mix

Its share in generation capacity is expected to rise to 63.2% in 2028 as shelved projects resurface.

Despite suggestions that President Jokowi signalled intentions to shift away from coal and focus on renewable energy in July 2019, coal is expected to continue to play a dominant role in Indonesia’s generation mix and have its generation share rise from an estimated 58.9% in 2018 to 63.2% in 2028, Fitch Solutions said in a report.

Developing a sustainable coal phase-out plan will require a massive overhaul of the existing Electricity Procurement Plan (RUPTL 2019-2028), and the introduction of strong support and incentives for alternatives, which may prove difficult, the firm said. “Our view is informed by the recently revised RUPTL published in February 2019, which projects net generation capacity growth of over 56GW by 2028, with a continued commitment toward coal to meet the country’s power sector expansion.”

Moreover, several large-scale coal power projects that were initially suspended have resurfaced in the latest RUPTL, such as the PLTU Java-3 or PLTU Java-9. Coal power projects also make up a significant majority based on capacity of all power projects in the pipeline; more than 70% of the 9.9GW of capacity developed by state-utility PLN under the FTP 1 was coal-fired, and 10GW of coal-fired capacity is planned under FTP 2.

Coal project majority in pipelines

Furthermore, PLN has taken steps to acquire coal mines and secure long-term coal supplies, including the development of more mine-mouth power projects, which points to its continued coal strategy.

According to Fitch Solutions, the renewables sector in Indonesia has been relatively under-developed despite its potential and continues to face challenges. “The lack of substantial solar and wind capacity in the pipeline is a notable trend and whilst we highlight that there is significant scope for the development of decentralised solar capacity in Indonesia, the outlook for the widespread deployment of utility-scale projects remains subdued,” it added.

The regulatory framework for the sector remains underdeveloped and policy changes in the sector over the last couple of years have created uncertainty and deterred investors, the firm said. “Some existing regulations challenge the development of the sector, such as the cap on feed-in-tariffs, or the new November 2018 regulation on use of Rooftop Solar Power Systems, which ended up disincentivising the sector’s growth instead.”

Local content requirements amidst the underdeveloped solar manufacturing industry, grid curtailment issues and difficulty in attaining a power purchase agreement with PLN, and the generally weak financing climate for renewables also pose a continued challenge.

“Whilst we expect to see growth, it remains limited compared to the expansion plans of coal and gas, as well as in relative comparison to its neighbours in the region,” Fitch Solutions concluded.




Weekly News

Bukit Asam to Offload 127.8 Million Treasury Shares at Year-End

PT Bukit Asam Tbk (PTBA) plans to offload around 127.8 million treasury shares, 23% of its 426 million treasury shares.

“A small part of the amount will be offloaded by as late as the end of the year, and the rest until 2021,” said Bukit Asam Corporate Secretary Suherman as quoted by, Thursday (22/8).

According to Mr Suherman, the price will depend on the regulation issued by the Financial Services Authority (OJK). The proceeds will be used to finance the company’s investment and planned development projects.

However, Bukit Asam CFO Mega Satria added that current market conditions still do not support mining issuers. The company, he said, is evaluating the possibility of offloading its treasury stock in accordance with OJK regulations.

Previously, Bukit Asam sold its treasury shares from the 2013-2015 buyback in April and May 2019. In total, the company sold 554.89 million shares for Rp 1.95 trillion, which gave the company a capital gain of 49% of the average selling price.

The proceeds were used to finance the company’s gasification projects in support of the Indonesian government’s downstreaming programme.


Mining People on The Move

Cokal Limited - Gerhardus (Garry) Kielenstyn

Cokal Limited (ASX:CKA, “Cokal” or “the Company”) advises that Mr Gerhardus (Garry) Kielenstyn has resigned as an Executive Director of the Company, effective immediately.

Mr Kielenstyn has worked with the Company since May 2013 when he was appointed Indonesian Country Manager. During June 2016 he was appointed to the role of the Company’s Chief Operating Officer and in January 2017 as Executive Director.

Mr Kielenstyn has resigned from the Board to attend to his other business interests and for personal reasons. The Board thanks Mr Kielenstyn for his work over the years, and wishes him all the best for his future endeavours.


Mining People on The Move

Gulf Manganese Corporation – Building A Successful Indonesian Smelting Business

The developer of premium Indonesian Manganese Alloys, Gulf Manganese Corporation Limited (ASX: GMC) has appointed highly experienced Mr. Ian Gregory as Company Secretary, as per the latest update on ASX.

Mr. Ian Gregory is a professionally well-connected Director and Company Secretary with more than 30 years of experience in the provision of company secretarial and business administration services. He has previously served as Chairman of the Western Australian Branch Council of Governance Institute of Australia.

On Education front, he has a Bachelor of Business degree from Curtin University and is a Fellow of the Governance Institute of Australia, the Financial Services Institute of Australia as well as a Member of the Australian Institute of Company Directors.

Earlier, Mr. Robert Ierace was serving as Company Secretary; however, due to increasing finance and governance requirements, the company made a decision to separate the finance and secretarial roles in order to strengthen the company’s professional resource base. Consequently, Mr. Robert Ierace is retiring from the position of Company Secretary to focus on his role as Chief Financial Officer.

Gulf to Acquire Strategic Interest in Iron Fortune Pty Ltd

Gulf Manganese Corporation recently made a strategic step to diversify its asset base beyond Indonesia by entering into an agreement to acquire a strategic 20% interest in Iron Fortune Pty Ltd. This is expected to provide Gulf with a first to market exploration opportunity in Timor-Leste. As per the Gulf, Iron Fortune’s strong local relationships and geological knowledge of the region will help the company in growing manganese footprint outside of Indonesia.

To acquire the 20% interest, the company will have to make an initial payment of A$100k for exclusivity while the due diligence process is completed. Both the companies have agreed for coordination in order to develop a work plan and strategic direction. And once the due diligence process is finalised, the company will pay a further A$200k and issue shares worth A$100k; and Iron Fortune will issue Gulf a 20% stake.

As per the financial terms, Gulf will also commit to spending A$300k on the Business by 31 August 2020, and a further $300k in the following 12 months to earn 35% and then 51% interest in Iron Fortune. Once the 51% interest is earned, Gulf will complete a mining study and reach a decision to mine to earn a further 29% interest for a total of 80%. After which, the current shareholders of Iron Fortune will have the right to fund the mining and development costs on a pro-rata basis. In case, Gulf completes the acquisition to 100% of Iron Fortune, the current shareholders will receive a 2.0% Net Royalty on Profit.

As per terms of the agreement, Hamish Bohannan will be appointed Non-Executive Director of Iron Fortune Board.

The company’s management believes that this partnership can significantly de-risk the Gulf’s ore supply chain and help it in expanding its high-quality manganese mining footprint and processing capabilities. It is believed that this will help in the development of Gulf’s Kupang Smelting Hub facility.

Kupang Smelting Hub Financial

The agreement is subject to various conditions, which include:

  • Gulf undertaking and completing its Due Diligence on Iron Fortune;
  • Gulf Board approval;
  • Gulf receiving the necessary regulatory approval (if required);
  • Confirmation that the Business is in good standing and fully compliant with respect to TimorLeste law and regulations.

Review of Company’s Operations

In the June quarter, the company made substantial operational progress with several key milestones achieved, including the securing of the Company’s Direct Shipping Ore (DSO) licence in May 2019.

In the month of May, the Company’s Indonesian subsidiary, PT Gulf Mangan Grup (GMG) received its Direct Shipping Ore Licence from Indonesia’s Ministry of Trade, allowing GMG to export up to 103,162 tonnes of high-grade manganese ore per year.

During the quarter, key management personnel attended the Vienna’s International Manganese Institute’s (IMnI) annual conference.

Recently, the company vended High-Grade Timorese manganese mine, Putra Indonesia Jaya (PIJ) to its key Indonesian and Singaporean partners and announced its intention to supply the 100% of the ore produced from this mine to Gulf’s operations in Kupang. It is expected that ore supply from the mine will commence in the month of September 2019. By the first quarter of calendar year 2020, the ore supply is expected to increase to around 2,000 tonnes per month.

During the quarter, the company successfully raised A$3.24 million by issuing ~647.20 million shares at $0.005 per share. The company has also agreed to place further 45 million shares at an issue price of $0.007 to Acuity Capital for a total of A$0.32 million in accordance with the Controlled Placement Agreement with Acuity announced on 31 January 2018. As per the company, the funds received from the placements will be used to advance preparations for DSO start-up and for general working capital purposes.

Cash Flow Position

During the June quarter, the company spend $679k of cash on development activities, $485k on staff costs and $624k on administration and corporate costs. The total net cash used in operating activities during the June quarter was around $1.79 million. The net cashflow from investing and financing activities during the quarter was $92k and $5,220k respectively.

The total estimated cash outflows for September quarter is around $1.7 million which includes around $980k to be spent on development, $450k to be spent on staff costs and $280k to be spent on administration and corporate costs.


By ramping up DSO exports over the coming months, the company intends to utilize the generated cash to finalise the commissioning of first two smelting hub furnaces at Kupang, which remain on-track for completion in the first quarter of next year. The company is also advancing discussions with debt funding providers and potential offtake partners to expedite this construction process.

Stock Performance

At the time of market close on 5th August 2019, GMC’s stock was trading at a price of $0.007 with a market capitalisation of circa 34.56 million.


Mining People on The Move

Asiamet Resources - Feng (Bruce) Sheng

Asiamet Resources Limited (“Asiamet” or the “Company”) is pleased to announce the appointment of Mr Feng (Bruce) Sheng as a Non-Executive Director to the Board effective from 10 July 2019. Mr Sheng is the Chairman of Melbourne based Asipac Group Pty Ltd, a diversified company with investments across the resources and financial sectors, and various property businesses. Mr Sheng also currently serves as Vice Chairman of the Australia China Business Council (Victoria) and the Executive Chairman of ASX listed Terramin Australia Ltd, a company developing a portfolio of zinc and gold projects in Australia and Algeria.

Tony Manini, Executive Chairman commented:

“On behalf of the Company we welcome Bruce to the Asiamet Board. Bruce has been a long-term supportive shareholder and we look forward to the opportunity to work more closely with him as we move into the project financing and development stage for the BKM project and continue advancing our other high potential projects on the KSK CoW and at Beutong. Bruce has spent the past 25 years working at the interface between China-Australia business and brings extensive experience and networks across China and greater Asia to the Asiamet board. This is particularly relevant given China’s One Belt-One Road policy and the large amount of Chinese inbound investment into Indonesia associated with it. Enhancing the Company’s level of connectivity with China is expected to add significant value as we continue the development of our portfolio of high-quality copper, gold and polymetallic projects. Different skills and experience will be required to take the Company forward and as such further evolution and strengthening of the board and management team is considered an important requisite for continued growth. Our ability to attract new directors of the calibre of Bruce, and Dominic before him, are testament to the progress we have made and the quality of the growth opportunity that Asiamet presents for investors. We look forward to continuing to deliver on our plans for the benefit of all stakeholders.”

The Company provides the following additional disclosure as at 10 July 2019 relating to the appointment of Mr Feng (Bruce) Sheng as director of Asiamet, effective 10 July 2019:

Mr Feng (Bruce) Sheng, aged 56, currently holds or has held the following directorships and partnerships over the last five years.

Mr.Sheng,through the holdings of Asipac Group,has an8.55% interest in the securities of Asiamet at the date of this announcement.

Except as disclosed in this announcement, neither the Company nor Mr. Sheng are aware of any further disclosures that are required in respect of the appointment of Mr. Sheng under Rule 17 or paragraph (g) of Schedule Two of the AIM Rules for Companies.


Tony Manini, Executive Chairman


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The information contained in this newsletter is intended to provide general information only. Opinions offered in any of the articles/releases contained in the newsletter are those of the individual making the representations and should not be considered to represent the opinion of Mitrais. Nothing in this newsletter is intended to provide legal advice or to be relied on as binding in any dispute, claim, action, demand or proceeding. The news articles/releases in the newsletter may also contain forward looking statements such as but not limited to statements concerning future operations of companies. All forward-looking statements may be subject to certain assumptions, a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from those expressed or implied. Readers are cautioned that such statements are not guarantees of future performances and that actual performances and explorations and financial results may differ materially from any estimates or projections. Mitrais accepts no responsibility for the adequacy or accuracy of the information contained in this newsletter, nor the responsibility to update any person regarding any inaccuracy, omission or change in such information.

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  5. all forward-looking statements may be subject to certain assumptions, a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from those expressed or implied. I have been cautioned that such statements are not guarantees of future performances and that actual performances and explorations and financial results may differ materially from any estimates or projections. I agree to exempt Mitrais from any responsibility for the adequacy or accuracy of the information contained in this newsletter, nor the responsibility to update any person regarding any inaccuracy, omission or change in such information.