Mitrais, Member of CAC Holdings Group

Mitrais Mining Newsletter

September 2019 | Vol. 36

Weekly News

Freeport Confident of Meeting 2023 Smelter Target After Securing $3b Loan Commitment

September 5, 2019

Freeport Indonesia, the country’s largest gold and copper miner, has secured a $3 billion financing commitment from 11 local and foreign banks, putting it a step closer to completing a critical smelter by 2023.

The company must complete the smelter to fulfill its part of the deal with the government to extend operations at its Grasberg mine in Papua until 2041.

“Freeport has obtained loan commitments from 11 banks and this is the first loan since the company started operating,” Freeport Indonesia president director Tony Wenas told BeritaSatu over the weekend. He added that three of the lenders are domestic banks.

Freeport Indonesia is currently building a smelter in the Java Integrated Industrial and Ports Estate in Gresik, East Java. It has invested $150 million of its own funds in feasibility studies, engineering services, environmental impact analyses, rental fees and soil maturation for site preparation.

The miner switched its contract of work agreement to a special mining business permit last year after intense negotiations, which saw the Indonesian government becoming the company’s majority owner.

The special mining business permit does not allow Freeport Indonesia to export copper concentrate and requires it to build a domestic smelter and establish a mineral refining and processing company within five years of the permit’s issuance.

“We believe the construction of the smelter can be completed on time and that it will be operational by December 2023,” Tony said.


Freeport Indonesia currently produces about 3 million metric tons of concentrate annually, 1 million of which is now processed by Smelting, a joint venture with Japan’s Mitsubishi in Gresik.

Smelting president director Hiroshi Kondo said the company processes about 1.1 million tons of copper concentrate annually, with 100,000 tons of it coming from Amman Mineral, a mining subsidiary of Medco Energy Indonesia in West Nusa Tenggara.

Smelting produces 291,000 tons of copper cathode annually, with byproducts including 1.04 million tons of sulfuric acid, which is used to make fertilizer; 805,000 tons of copper slag, used in the cement industry; 31,000 tons of gypsum, a building material; and 2,000 tons of anode sludge; which contains gold, silver and other precious metals.

State-owned Petrokimia Gresik takes the sulfuric acid from Smelting, while several cement manufacturers process the copper slag.

But Kondo said Smelting only paid out dividends in the past three years, after 23 years of operations, as local market absorption is less than expected.

“One of our considerations in smelter investment in Indonesia is the large Indonesian market. It turns out, most of the cathode must be exported because of the small absorption capacity in the domestic industry,” Kondo said.

Smelting’s cathode is exported to Malaysia, Thailand and Vietnam, where it competes with cheaper products from other suppliers.

Tony said Freeport expects its new smelter to face similar challenges. “But this is our commitment,” he said.

Tony added that Freeport’s smelter plant would produce about 550,000 tons of copper annually and enough anode sludge to allow a third party to produce between 30 and 60 tons of gold and 120 tons of silver per year.


Weekly News

Blackstone Resources Enters Joint Venture for Nickel with Indonesian Partner

August 26, 2019

Blackstone Resources AG (SWX: BLS;) (“Blackstone”) is pleased to announce that it has entered a strategic alliance with a well-respected national partner on joint venture basis in Indonesia. The agreement is an important element of Blackstone’s broader strategy to expand its presence in the global battery materials market and establish long-term cooperation with leading battery manufacturers worldwide.

The partnership will initially involve exporting ore, concentrates and refined products of nickel, copper and other technology metals. Export licenses have been secured to initially export nickel ore, one of the main raw material and increasingly important for batteries, stainless steel and alloys. This will progress to non-ore products later this year.

This is yet another example of Blackstone leveraging its strategic network or partners to further extend its influence in the battery metal market. This is a great achievement for the company, which Blackstone believe will deliver tangible benefits in the future.

Blackstone Resources AG

Blackstone Resources is a Swiss Holding Company, with its legal domicile in Baar, Kanton Zug and is concentrating on the battery metals market as primary metals. In addition, it sets up, develops and manages refineries used for gold and battery metals. It offers direct exposure to the battery metal revolution that is being driven by the demand of electric vehicles that need vast quantities of these metals. These include cobalt, manganese, molybdenum, graphite, nickel, copper and lithium. Blackstone Resources has developed the new Battery code BBC. In addition, Blackstone Resources has started a research programme on new battery technologies on solid state batteries and its production process.


Weekly News

Indonesian Coal Market Makes Slow Start to The Week

August 26, 2019

The Indonesian physical coal market made a typically slow start to the week, even as enquiries began to increase since the end of last week as some market participants see the market may be finding a floor.

Enquiries from Chinese buyers for prompter cargoes began to surface towards the end of last week as they expect stricter import curbs from October. Indian buyers also started to express interest for cargoes arriving after the June-September monsoon season.

Bid and offer levels in the fob GAR 4,200 kcal/kg market were mostly unchanged today from the end of last week. September-loading geared supramax cargoes were bid in a $30.50-31/t range, while offers were also steady at around $31-31.50/t. Argus assessed the GAR 4,200 kcal/kg coal price at $31.01/t on 23 August.

The ICI 4 derivatives market made a slow start to the week, with first-quarter 2020 contracts offered today at $34.25/t and no matching bids. The last Argus assessed price for first-quarter 2020 ICI 4 futures on 23 August was at $34/t.

Trading activity in the ICI 4 derivatives market was also sluggish last week, with just a 10,000t clip for October clearing at $31.25/t on the CME. Last week’s trade took the total ICI 4 derivatives cleared the CME so far this month to 139,000t.

The Australian fob Newcastle market saw an index relevant trade done today at $60.50/t fob for an October-loading 75,000t cargo of NAR 6,000 kcal/kg coal. The level of the trade, which was done on screen, was down from the most recent assessment of $61.72/t fob Newcastle on 23 August.

A 25,000t clip of the same material traded at $65/t fob Newcastle for November loading, also on screen, but this did not fit the Argus index.

Buyers and sellers’ expectations in the NAR 5,500 kcal/kg market appeared mismatched as Chinese buyers were seeking September-loading cargoes, while sellers were already looking to offload their October supplies. Buyers’ interest for September was in line with last week when a September-loading Panamax was bid at $49/t fob Newcastle.

China’s futures market had the September contract on the Zhengzhou commodities exchange close at 586.20 yuan/t today, up by Yn0.40/t from 23 August.


Weekly News

PLN and ESDM Partner in exploration on geothermal project at Mataloko, Indonesia

August 26, 2019

In July 2019, PT PLN and the Ministry of Energy and Mineral Resources (EDSM) in Indonesia, signed a collaboration agreement on exploration and drilling of wells in the Mataloko geothermal working area.

The Ministry of Energy and Mineral Resources and PT PLN (Persero) signed a memorandum of understanding (MoU) of exploration studies and drilling of production wells in the Mataloko Geothermal Working Area (WKP).

The MOU was signed by the Head of Geology Agency Rudy Suhendar and PLN’s Strategic Procurement 1 Director Sripeni Inten Cahyani in July 2019.

Head of Research and Development Agency of the Ministry of Energy and Mineral Resources Dadan Kusdiana said the government is committed to increasing the electrification ratio in NTT Province through accelerating electricity infrastructure projects that are sourced from geothermal energy. The signing of the MoU was seen as a form of government commitment.

Flores Island in NTT has 12 regions with geothermal potential, three of which have obtained WKP management permits, namely Ulumbu, Mataloko, and Sokoria with a total installed capacity of 12.5 MW.

With the utilization of geothermal potential, in the future it is expected to significantly increase the electrification ratio in NTT. The Ministry of Energy and Mineral Resources noted the electrification ratio of NTT was among the lowest in Indonesia with 72 percent achievement as of June 2019.

“Along with the development of tourism in the region, electricity demand in NTT continues to increase. Currently, most of NTT’s electricity needs are still being supplied by diesel power plants [PLTD],” he said through an official statement.

In this collaboration, the Ministry of Energy and Mineral Resources through the Public Service Agency (BLU) Center for Research and Development of Electricity Technology, New Energy, Renewable and Energy Conservation (P3TKEBTKE) and BLU Institute for Oil and Gas (Lemigas) will carry out several geothermal studies, including studies risk mitigation, geophysical geochemical geological studies, analysis of environmental impact (EIA) studies, and the use of mobile hydraulic rigs.

Previously, the Lemigas BLU and PLN had worked together to provide consulting services for calculating the actual losses of the Arun Block regasification and procurement of consulting services for the study of gas prices for PLN electricity.

The role of the Geological Agency in this collaboration will be carried out by the Center for Mineral Resources, Coal and Geothermal (PSDMBP) because it has the capability and equipment for geothermal exploration drilling.

Meanwhile, PT PLN Gas and Geothermal (PT PLN GG) as a subsidiary of PLN that handles gas infrastructure and the supply of geothermal electricity, was assigned to develop the Watal Mataloko in the construction of a 2.5 MW PLTP.


Weekly News

Vale Keen to Meet Jokowi to Push for Divestment Decision

August 27, 2019

Vale Indonesia, the country’s largest nickel producer, said they were looking forward to a meeting between President Joko “Jokowi” Widodo and the top executive from its Brazilian parent company Vale to discuss the divestment of the company’s shares to a local entity.

“I will ask the bosses to come [to Indonesia] to meet with the president. Hopefully, we can schedule a meeting with him. If not, who will help us,” Nico Kanter, Vale Indonesia’s president director, said on Tuesday.

The government has demanded that Vale’s foreign owners divest at least 40 percent of their shares to local entities, including the government, state-owned enterprises and local companies.

The company has so far sold 20.5 percent of the shares to the public and is required to sell the remaining 20 percent by October.

The divestment was part of the requirements for the company to switch its license from a work contract to a mining business permit five years ago.

Indonesia Asahan Aluminum (Inalum), a state-owned holding for mining companies, has said it was ready to buy Vale Indonesia’s remaining shares but needs a green light from the government to do it.

Inalum’s subsidiary Aneka Tambang has also expressed an interest to buy the shares.

Nico said he was a little concerned with the long wait for the government’s decision on the divestment since the October deadline is approaching.

“But we fully trust that the government sees Vale as a strategic partner,” Nico said.

There has been no valuation or offer for Vale Indonesia’s divestment, but the company commanded a market capitalization of Rp 31 trillion ($2.2 billion) at the Indonesia Stock Exchange on Tuesday.

The company is currently controlled by Vale Canada, which owns 58.73 percent of its shares. Sumitomo Metal Mining (20.1 percent), Vale Japan (0.55 percent) and Sumitomo Corporation (0.14 percent) are the foreign investors in the company. The Indonesian public owns 20.5 percent of the company’s shares.

Smelter Development

Vale Indonesia is currently in the final stage of talks with an undisclosed Chinese company for the construction of a ferronickel smelter near its Bahadopi mine in Central Sulawesi.

“We hope the project can be completed soon. The negotiation has taken longer than we expected,” Vale Indonesia director Febriani Eddy said on Tuesday.

The refining plant will have the capacity to produce 70,000 ferronickel per year and will cost somewhere between $1.6 billion and $1.8 billion.

Vale will also need $300 million to develop the mine. Febriani said Vale Indonesia will bear all the investment costs.

Vale Indonesia is also in negotiations with Japanese mining company Sumitomo to build a nickel smelter near its mine in Pomalaa in Southeast Sulawesi.

Under the plan, Sumitomo will have a 51 percent stake in the smelter, with the rest controlled by Vale.

Febriani said the smelter will require an investment of $2.5 billion and the company will need another $300 million to develop the mine.

Vale has already applied for permits for the plant and the mine, a process expected to be completed by 2021.

After that, Vale will begin construction on the Pomalaa smelter, which could take up to five years.


Weekly News

Nickel Ore Export Ban Is Good for Indonesia: Vale

August 27, 2019

Vale Indonesia, the country’s largest nickel producer, said the government’s planned ore export ban will give the country a strategic advantage and bring positive impact to the local nickel industry and the Indonesian economy in the long term.

The government now wants the ban to start taking effect in October, three years earlier than the initial plan’s 2022 target.

The Indonesian Nickel Mining Association has voiced their objection to the plan, saying that it would disrupt their members’ contractual obligations and business plans.

Bernandus Irmanto, the president director of Vale Indonesia, however, said Indonesia may be better off by imposing the ban sooner than later, especially considering its ambition to make electric car batteries from nickel ores.

“The best limonite ores for electric car batteries are grade 1.4 and below. If the government allows exports for grade 1.7 and below, then we are exporting the best materials for the batteries. Most countries are buying the main materials for batteries from us, and the receiving countries, such as China, mostly just pile them up,” Irmanto said on Tuesday.

In addition, the ore export ban would keep the price of nickel in the global market high. Nickel price has been rising by 30 percent since June.

“Indonesia is a big player in the global nickel market. We contribute 27 percent of all the nickel products in the market. We stand to profit a lot from a higher price for nickel,” Irmanto said.

According to a 2018 WoodMac study, Indonesia’s 27 percent share of the global nickel market was followed by the Phillippines’ 14 percent, Latin America’s 10 percent and New Caledonia’s 9 percent.

However, Irmanto said the government must take caution when issuing the ban since some local nickel companies already have legally binding export contracts.

“The government must look into this carefully and be cautious when setting the quota for the export ban. Some companies can be impacted in the long term if they are already bound by a legal contract to export nickel ores,” Irmanto said.


Weekly News

Astra Seeks New Opportunities in Mining, Infrastructure

August 27, 2019

Diversified conglomerate PT Astra International is seeking to further expand its businesses in the mining and infrastructure sectors to reduce its reliance on car manufacturing.

The publicly listed company was hit badly during the first half of this year as the country’s car sales dropped sharply during the January-June period. To make matters worse, low crude palm oil (CPO) prices also caused its plantation subsidiary PT Astra Agro Lestari to suffer a financial loss during the first six months of 2019.

With such unfavorable conditions, Astra booked a 3 percent increase in total revenues to Rp 116.18 trillion (US$8.147 billion) year-on-year (yoy), but its net profit fell by 6 percent to Rp 9.8 trillion.

According to the Association of Indonesian Automotive Manufacturers (Gaikindo), the country’s total car sales dropped by 13 percent yoy to 481,557 cars during the January-June period. Astra, which has a 53 percent market share in the country’s car market, reported a 5.5 percent drop in car sales during the period.

Market analysts believe that sluggish sales would continue in the second half, as there have been no signs of improvement in the economy. With such conditions, Astra will further step up cost-efficiency measures, said the group’s president director, Prijono Sugiarto.

“For the short term, we’re trying to be the lowest-cost producer,” he told reporters during a press briefing at the Indonesia Stock Exchange (IDX) in Jakarta on Monday.

In the meantime, he said, the company would also look for new opportunities to expand its other business, particularly in mining and infrastructure.

Its subsidiary, PT United Tractors, which took over the Martabe gold mine in North Sumatra last year, is seeking new acquisitions to further expand its mining business.

“Besides considering the [mine’s] reserves, we are also considering the location of the mine and the duration of the license,” said United Tractors president director Frans Kesuma.

He added that the company would avoid mines containing alluvial gold, which is usually found in creeks, rivers or streams, as they tended to attract illegal miner.

Although PT United Tractors had evaluated several mines, Frans said it had yet to narrow in on a target to acquire, he added.

Prijono said Astra also sought to further expand to infrastructure development, which remains one of the government’s priorities.

The government has allocated Rp 419.2 trillion for infrastructure development in the draft 2020 state budget, about half of the total funds required.

The Rp 400 trillion gap is expected to be filled by private entities, including Astra, Prijono said.

He added that Astra would also seek opportunities to expand its power generation business through PT United Tractors, which is currently building the coal-fired PLTU Jawa 4 power plant with a capacity of 2×1,000 megawatts in Jepara regency, Central Java, in cooperation with Japan’s Sumitomo Corporation and Kansai Electric Power Co.

Astra also intends to extend the length of toll roads it operates to 500 kilometers in 2021 from 350 kilometers this year as part of its expansion in the infrastructure business.

Company director Paulus Bambang said one of the strategies for expanding its toll road business was to take part in a new toll road auction.

Following a $250 million investment in ride-hailing app Gojek, Paulus said Astra was looking to further widening its digital business by investing in promising start-ups.

“[The investment] will be both in preseed and seed funding,” he said but declined to go into detail about the topic.

Moreover, Paulus said, the company began focusing on its own internal digital investment by launching automotive marketplace back in May. The site, he said, was part of the company’s effort to catch up with the changing times as it enabled customers to buy both new and used cars online.


Weekly News

Indonesia Coal Miner Bukit Asam Aims to Cut Financial Targets, Cites Weak Prices

August 27, 2019

The official declined to disclose current revenue and profit targets or new targets proposed to parent company PT Inalum

Indonesian state coal miner PT Bukit Asam aims to lower its undisclosed financial targets for 2019 due to lower prices, corporate secretary Suherman said on Tuesday

* The official declined to disclose current revenue and profit targets or new targets proposed to parent company PT Inalum

* “The targets were set when the coal price was around $90 per tonne, and its now around $70 and this is very much impacting our revenue and profit,” said Suherman, who goes by a single name as is common practice in Indonesia

* Bukit Asam said in March it aims to sell 28.38 million tonnes of coal, including 14.7 million tonnes for exports

* The company sold 13.40 million tonnes of coal in the first half of the year, up nearly 10% from a year earlier, and produced 12.79 million tonnes of coal, up around 15% from a year earlier

* The company is yet to publish its January-June financial report due to an ongoing audit


Weekly News

Stainless Steel Imports Expand 55% in Jul as Volumes from Indonesia Quadruple

August 27, 2019

China’s imports of stainless steel rose 55.33% from June to 73,900 mt in July, showed data from China Customs, as materials from Indonesia soared 300% after local cold rolling lines broke down.

Indonesian stainless steel imports accounted for 35%, or 25,976 mt of the total for July. A greater amount of Indonesian hot-rolled stainless steel entered China last month, through processing trade to avoid anti-dumping duties.

China’s imports of stainless steel shrank 43.71% year on year to 690,800 mt in the first seven months of this year, with imports of Indonesian materials down 61% to 317,300 mt.

Customs data also showed that exports of stainless steel rose 16.24% from a month ago but declined 3.11% from a year ago, to stand at 329,700 mt in July.

Exports in January-July shrank 19.14% year on year to 2.03 million mt.

This brought net exports in the January-July period to 1.34 million mt, with a year-over-year increase of 4.41%.


Weekly News

China's Tsingshan, Huafon Plan $3 bln Coke, Chemical Project in Indonesia

August 28, 2019

* China’s Tsingshan Holding Group, a major stainless steel and nickel producer, and chemicals firm Huafon Group plan to set up a $3 billion metallurgy and chemical production base in Indonesia, Huafon said in a statement

* The two companies, both based in eastern China’s Zhejiang province, on Tuesday signed a deal to jointly build the base, which will include a 12 million tonnes per year capacity coke plant, on the island of Sulawesi

* The first phase of the project will produce coke and other steelmaking raw materials, as well as synthetic ammonia, the statement said, while the second phase will use crude benzene to develop polymer materials

* No timeframe was provided for the launch of the project, although the statement said the two sides had assembled working groups to carry out implementation work so it can be launched “as soon as possible”

* Tsingshan, which did not immediately respond to a request for comment on the plans, is the biggest nickel producer in Indonesia and is pursuing two separate projects to produce battery chemicals on Sulawesi


Weekly News

East Asia Minerals Enters Into Loan Agreement For Up To US$23,000,000

August 28, 2019

East Asia Minerals Corporation (the “Company”) (EAS:TSX.V, EAIAF:OTCBB) is pleased to announce that it has entered into a loan facility agreement providing up to $23 million in working capital for the final development stages of the Company’s Sangihe Project.

CEO Terry Filbert said: “The proposed loan facility agreement will enable us to begin exploration and infill drilling of the Binebase/Bawone corridor to increase both resources and reserves, as well as for general working capital.”

Loan Facility Terms

The Company has entered into a secured loan facility agreement with a Middle East based private fund, for the provision of up $23 million in working capital for the Company’s Sangihe Project and to move other projects forward as well. The arrangements under the loan provide for a term expiring 22 years from the date of one or more advances under the loan, including a two (2) year grace period from any principal and interest payments. Interest shall accrue at 4% on ninety-one percent of any advances comprising the principal of the loan. The loan shall be secured on the shares the Company holds in its wholly owned subsidiary that in turn wholly owns the Company’s 70% interest in the Sangihe Project through its Indonesian subsidiary.

The Sangihe gold-silver-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 ounces and 105,000 inferred ounces of gold. The Company’s 70 percent interest in the Sangihe mineral tenement contract of work is held through PT Tambang Mas Sangihe(PT TMS). The remaining 30 percent interest in PT TMS is held by three unaffiliated Indonesian corporations. The term of the Sangihe contract of work 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

Indonesia's Decision to Move Capital to East Kalimantan Could Disrupt Coal Mining: Sources

August 28, 2019

Market sources expect some disruption to mining activity and stricter environmental standards after the Indonesian government picked the coal-producing region of East Kalimantan to host the country’s new capital.

President Joko Widodo said Monday the new capital would be in East Kalimantan province, which is home to several major thermal coal producers’ mines, including Adaro and Indika.

The capital will be between the districts of North Penajam Paser and Kutai Kartanegar, near Samarinda City and the port city of Balikpapan. Both cities are strategic for coal and oil shipments, with Samarinda hosting Indonesia’s main coal terminal while Balikpapan is the country’s oil hub.

There is no detailed information on the development, but there is talks that mining could be affected, sources said.

“Some are worried that mining activities at the Paser area will be disrupted, and that some of the work contracts will not be extended,” said an Indonesian producer.

“Right now we can’t do much as we don’t have much information,” he said, adding that having government services in the province could help clean up the coal industry.


“For example, they might clean up illegal mining, and might have better work processes when it comes to collecting mining data, which is good for the industry as a whole,” the producer said.

Other sources said that although they expect more environmental regulations, they do not foresee a major policy shift when it comes to the coal mining industry in East Kalimantan.

“I think the government will still need income from coal,” a Singapore-based analyst said, adding that there could also be more environmental supervision in the province.

“Mining standard may [be] stricter there, but I don’t think it’s a big issue,” he added.

Another Indonesian producer said other commodities, including steel, nickel and aluminum, would be required to build the new city.

“Domestic coal consumption will be boosted as energy demand will be ramped up, so this will help the coal industry in Indonesia remain attractive,” he said.

According to Indonesian officials, construction of the new capital is expected to begin in 2021, and will be completed by 2024.

The relocation is said to help spread economic activity across the country and counter rising sea levels in Jakarta.


Weekly News

INALUM Holds An Event to Enliven 74th Independence Day of Indonesia

August 29, 2019

PT Indonesia Asahan Aluminium (Persero) or INALUM has once again held a Freedom of Celebration (SUMMER) activity in commemoration of the 74th Anniversary of the Republic of Indonesia. The series of SUMMER activities was officially opened by INALUM Managing Director Oggy Achmad Kosasih on Friday (16/8) at Tanjung Gading Main Field.

In his remarks, Oggy explained that SUMMER was carried out in the context of the spirit of independence and valued the services of the heroes. “INALUM held this year’s SUMMER which began with a torch relay tonight, in this August 17, let’s build a spirit of mutual cooperation and work hard to realize the noble ideals of the nation. In addition, let’s uphold sportsmanship and realize cooperation to achieve the INALUM Vision , “Oggy said.

After opening, the event continued with a torch relay which was followed by schools around Tanjung Gading and continued with theatrical performances and poetry by the INALUM Women’s Association (Perwina). The evening was closed with a fashion show competition, stand up comedy and bazaar.

In addition to the series of activities on the night of August 17, INALUM is still holding other activities included in the SUMMER series, namely basketball, volleyball, soccer, futsal, table tennis, badminton, BMX, field tennis, environmental competitions, story telling competitions, fashion competitions shows, automotives, bazaars, fireworks parties, August 17 competitions, mass dances, ballet performances, and others.

On this occasion, Anshor Phasa as the chairman of the 2019 SUMMER committee expressed his hope that SUMMER activities will run safely and smoothly. “Let’s uphold sportsmanship and safety in competition so that SUMMER activities can run safely and smoothly until the other closing day,” Anshor hoped.


Weekly News

INALUM and BGR Synergize to Hold a Series of Activities of SOE for the Nation

August 29, 2019

PT Indonesia Asahan Aluminium (Persero) or INALUM and PT Bhanda Graha Reksa (Persero) or BGR carry out a series of activities of the SOE for the Nation in commemoration of Indonesia Independence Day in 2019. Series The program consists of 2 core activities, namely the 74th Anniversary Ceremony of the Republic of Indonesia and the 3.5 KM Healthy Walk held at Madani Field, Sigi Biromaru District, Sigi Regency, Central Sulawesi Province on Saturday-Sunday, August 17-18, 2019.

In this activity INALUM was appointed by the Ministry of SOEs as the PIC for the area of​Central Sulawesi Province accompanied by BGR as Co-PIC. This activity was also attended by Norma Mardjanu as the Expert Staff of the Governor of the Central Sulawesi Provincial Government Representative and Muh. Basir Lainga, SE, MP as the Secretary of Sigi District representing the Regent of Sigi Regency.

Also present was Deputy Assistant for Mining, Strategic Industry and Media Business II, Ministry of BUMN Heri Purnomo, Director of INALUM Strategic Services Ogi Prastomiyono, Finance and HRD Director of PT Bhanda Ghara Reksa (Persero) Endang Suraningsih, Executive Director of INALUM Business Development Dante Sinaga and VP Corporate Corporate Secretary of PT Bhanda Ghara Reksa (Persero) Fuad Adi Siswoyo.

The ceremony to commemorate the 74th Anniversary of the Republic of Indonesia was held at Sigi Biromaru Field, Saturday 17 August 2019 Morning. The ceremony was attended by around 300 participants consisting of BUMN employees in Central Sulawesi, Koramil 1306-02 / Biromaru, Sigi Biromaru sub-district government, students of SMA N 1 Sigi and SMK N 7 of Marine Palu and the Cultural Arts Institute of Bantaya Central Sulawesi. As for acting as Ceremony Inspector is INALUM’s Strategic Services Director, Ogi Prastomiyono.

After the ceremony, Ogi explained the purpose of the SOE Present for the Country program. “The series of ceremonies is inseparable from the Present SOE for the State (BHUN) Program initiated by the Ministry of SOEs. BHUN is a real SOE action to be present in the community in carrying out its role as agent of development. The location of the event in Sigi which is one of the areas most affected by earthquakes and liquefaction also shows SOE’s concern for the suffering of the victims, “Ogi explained.

In addition to the implementation of the ceremony to commemorate the 74th Anniversary of the Republic of Indonesia in Central Sulawesi, INALUM and BGR also carried out the Healthy Walk 3.5 KM on August 18, 2019 at the same location. The activity was attended by around 3,000 participants consisting of Central Sulawesi BUMN Employees, Central Sulawesi Forkopimda / Sigi and Communities in Biromaru District and surrounding areas. The activity also provided free culinary in the form of Central Sulawesi traditional food involving 6 local SMEs and Lucky Draw withdrawal from the organizer with a total prize of Rp 50 million with a door prize of 1 motorcycle.

Other activities that took part in the two activities were the 4,000 package low-cost market, free medical treatment, assistance to meet the basic needs of the community, electrification, construction of wellbore water facilities, repair of facilities and infrastructures for Orphanages, Islamic Boarding Schools & Houses of Worship and MCK assistance. and Scholarships.


Weekly News

Nickel Leaps to 5-year High as Indonesia Bans Ore Exports from December

August 30, 2019

Nickel soared to its highest in five years on Friday on supply concerns after major producer Indonesia said it would ban the export of ore from December.

Nickel prices on the London Metal Exchange (LME) jumped 8% to $17,780 per tonne in official trading rings, their highest since September 2014.

“The rumours that the ban could be brought forward have been pushing higher for the whole summer and the rise today is proof it wasn’t fully priced in,” said ING analyst Warren Patterson.

The price of the metal, mainly used in stainless steel, is up about 60% this year, far outpacing other base metals.

Indonesia’s Energy and Mineral Resources Minister Ignasius Jonan said he has signed a new regulation on restricting ore exports, according to a voice recording verified by a ministry spokesman. Ore exports were originally banned in 2014 but were reopened for certain minerals in 2017 to give miners time to build smelters to process minerals such as nickel, bauxite and copper.

It now only allows miners to export low-grade nickel.

SPREADS: The premium of LME cash nickel to the three-month contract spiked to its highest since at least a decade at $99 a tonne, usually a sign that supply is tightening. POSITIONS: One party has control of 50%-79% of LME inventories, data showed on Friday. MARKET BALANCE: The global nickel market deficit narrowed to 45,100 tonnes in the first half of the year compared to a deficit of 85,200 tonnes in the same period of 2018, according to the International Nickel Study Group. The group sees a deficit of 84,000 tonnes this year compared to a shortage of 146,000 tonnes in 2018, it said in May.

INVENTORIES: On-warrant inventories of nickel in LME-approved warehouses available to the market are up 26% so far this year at around 109,500 tonnes. In Shanghai, data showed nickel stocks plunged 20% to 19,955 tonnes in the week to Friday. WASTE SPILL: Waste from a nickel plant in Papua New Guinea owned by Metallurgical Corporation of China spilled into the adjacent Basamuk Bay at the weekend, adding to supply concerns. MINE CLOSURE: African Rainbow Minerals said it would place its loss-making nickel mine in South Africa on care and maintenance from September 2020 in preparation for closure. The mine, jointly owned by Russia’s Norilsk Nickel, produced 13,300 tonnes of nickel in 2018.

PRICES: Copper traded 0.8% lower at $5,680 per tonne, aluminium eased 0.7% to $1,741.50, zinc fell 1.2% to $2,241, lead shed 0.8% to $2,042, while tin inched 0.2% higher at $15,825.


Weekly News

East Asia Minerals Corp. Announces Shares for Debt Transaction

August 30, 2019

East Asia Minerals Corporation. (the “Company” or “EAS”)(TSX-V) reports that its board of directors has approved the settlement of up to $50.000 of debt through the issuance of common shares of the Company (the “Debt Settlement”). Pursuant to the Debt Settlement, the Company would issue up to 666,667 common shares of the Company (the “Shares”) at a deemed price of $0.075 per Share to certain creditors of the Company, including certain directors and officers (the “Creditors”)

The issuance of the Shares to the Creditors is subject to the approval of the TSX Venture Exchange. All securities issued will be subject to a four month hold period which will expire on the date that is four months and one day from the date of issue.

As certain insiders participated in the Debt Settlement, it is considered to be a “related party transaction” under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transaction (“Mi-61-101”). All of the independent directors of the Company, acting in good faith, considered the transactions and determined that the fair market value of the securities being issued to insiders and the consideration being paid is reasonable. The Company intends to rely on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in section 5.5(a) and 5.7(a).


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

Terry Filbert,
Chairman & CEO


Weekly News

[SMM] It Is Reported that Indonesia's Minister of Energy and Mining Has Been Dismissed as False News

August 30, 2019

SMM8 30: according to the latest news from Bloomberg, the government has finally decided to speed up the ban on nickel ore exports. (ESDM) Ignasius Jonan, Indonesia’s ministry of energy and mineral resources, said nickel ores with a content of less than 1.7 per cent were no longer allowed to be exported from late December 2019. The decision did accelerate, according to the minister of energy and mineral resources, as the government imposed an export ban on exports to take effect in 2022. Jonan explained that the policy was in line with President Joko Widodo’s directive on accelerating the downstream of minerals, which was expected to provide greater added value than exports of raw materials alone. Nickel mines, which have long been at more than 1.7 per cent, have not yet been allowed (exported), and the government has allowed (exports) to be below 1.7 per cent since 2017. According to the president’s instructions, we will limit the time to the end of December. ”

Affected by the news, LME three-month nickel rose sharply, as of 19:55, an increase of 8.14%. But then fell back slightly, as of 19:23 in the evening, Lun Ni at $17480 / ton, up 6.7%, domestic Shanghai Ni night trading rose by the limit.

This evening, the news that “Indonesia’s Minister of Energy and Mineral Resources was dismissed” was false. It is understood that the news was announced in August 2016 as “Indonesia’s Minister of New Energy and Mineral Resources was sacked because of dual nationality.” some of the excerpts from the article are as follows:

According to the British Reuters News Agency, Indonesia’s Secretary of State said on the 15th that the country’s Minister of Energy and Mineral Resources, Tahar (Arcandra Tahar), had been removed from office by the President less than a month after it was reported that he had dual Indonesian and US nationality.

It is reported that Pandjaitan (Luhut Pandjaitan) will take up the post of interim energy minister and will remain in the current post of minister of coastal defense. “in order to resolve public doubts about Tahar’s nationality, the president has decided to replace Tahar,” Secretary of State Platticano (Pratikno) said in an interview. ”

It is reported that Indonesia is a country with a Muslim population and does not recognize the dual nationality of adult citizens. Tahar, a former chief executive of an engineering company in Texas, was part of the second cabinet reshuffle of Indonesian President Joko Widodo (Joko Widodo) last month. According to the report, an analysis said that Tahar was removed from office less than three weeks later, which is indeed very embarrassing, and this is also the case for the government. ”

According to comparison, the Minister of Energy and Mineral Resources mentioned in the news is Tahar (Arcandra Tahar), and the current Minister of Energy and Mineral Resources of Indonesia, (ESDM), is Iknadius Zonan Ignasius Jonan.


Weekly News

Nickel Surges Past US$8.10/lb on Indonesia Export Ban

August 31, 2019

Metal has become a hot commodity as supply fears grip markets 319

The price of nickel broke through the US$8/lb on Friday, as supply shortage fears increased when Indonesia announced a ban on nickel exports beginning in December.

The price of nickel broke through the US$8.10/lb on Friday, as supply shortage fears increased when Indonesia announced a ban on nickel exports beginning in December.

That’s more than two years earlier than the Asian nation originally planned, and rumours the export ban would be moved up has helped push nickel prices upward in recent months. Indonesia is the world’s largest nickel exporter.

Friday was the largest one-day increase in nickel prices in a decade, according to a story in the Wall Street Journal, and prices have increased by almost 70 per cent since the beginning of the year.

The ban would almost certainly push the global market in refined nickel to a deficit, analysts quoted in the story said.

“All in all, 100,000 tons of refined nickel output will be lost, which will leave the market in a meaningful deficit,” Timothy Wood-Dow, an analyst at BMO Capital Markets, is quoted as saying in the story.

A major waste spill at a Chinese-owned nickel plant in Papua New Guinea could close the facility, stoking market fears further.

“This is a game changer for the market,” said Wenyu Yao, metals strategist at Dutch bank ING. ““It’s not just Indonesia … All things are coming together to push nickel higher, not just fundamentally but also technically.”

Fears over supply also boosted mining stocks, according to a story from Reuters, with Rio Tinto, BHP and Glencore stocks rising more than two per cent each.

The turmoil has boosted prices in the short term, with analysts even more bullish on nickel in the long-term because of an expected boom in use of electric car batteries in the next decade. A higher grade of nickel is needed to make the batteries, and China is moving ahead with plans to expand electric car production and use.

Volkswagen and Tesla are among car manufacturers with big plans to increase production of electric cars and batteries for their markets.


Weekly News

Advanced Indonesia Export Ban Threatens China’s Nickel Ore, NPI Shortage in 2020

September 1, 2019

China’s nickel ore market will flip to a deficit in 2020 as major supplier Indonesia brought forward the ban on mineral exports to December 31, from the previously scheduled 2022.

Indonesia’s Energy and Mineral Resources Ministry said on Friday August 30 that the country will ban exports of nickel ore with Ni content below 1.7% from the end of December. SMM confirmed with traders and Indonesian miners that they already received the notice and any unexpired quota will become invalid by December 31.

The announcement means no nickel ore will be shipped out of Indonesia in 2020, including ore with a grade above 1.7%, as the country has been forbidding the export of high-grade nickel ore in the first place since 2014.

SMM assessed China’s nickel ore imports at 500,000 mt in metal content in 2020 after the ban, far from meeting domestic demand. The imports include some estimated 50.56 million wmt from the Philippines, the country’s record-high exports struck in 2014, some forward arrivals of 1.38 million wmt from Indonesia, about 4 million wmt from New Caledonia, and 500,000 wmt from Guatemala.

Over the years, China’s lateritic nickel ore supply completely relied on imports, with materials from the Philippines and Indonesia accounting for over 90% of the total imports and products from Guatemala and New Caledonia taking up the rest.

As the largest lateritic nickel ore supplier to China in 2012-2013, Indonesia accounted for over half of the ore imports in China. But imports of Indonesian ore shrank steeply close to zero after Indonesia initially banned ore exports in January 2014, with only some 100,000 wmt/year of ferrous ore with low nickel content being moved to China.

In 2017, the original export ban was lifted for certain minerals, or ore with a grade below 1.7%, allowing miners who were building smelters to export unprocessed mineral until January 2022.

This resumed China’s imports of nickel ore from Indonesia in 2017-2019 with growing quotas being granted. In 2018, some 19.66 million wmt of lateritic nickel ore originated from Indonesia entered China, with 18.92 million wmt of middle-grade ore with 1.65% Ni and 740,000 wmt of low-grade ore.

Imports of Indonesian lateritic nickel ore stood at around 17.16 million wmt in January-August this year. While there remained some 38.61 million wmt of unexpired quotas by the end of August, most of them have already been used and the available quotas are estimated at 15 million wmt.

Imports from Indonesia could amount to 32.65 million wmt if the remaining quotas are used up. But given a monthly shipment capacity of 2.75 million wmt from Indonesian mines, imports may only reach 28.87 million wmt for the whole 2019.

Unlike the period after the original Indonesia ban in 2014, nickel ore supply in China is expected to face a great shortfall in 2020 due to resource depletion in another key supplier the Philippines. Chinese downstream producers and traders stockpiled feedstock before the Indonesian export ban in 2014. This, together with expanding supplies from the Philippines, offset the impact of import disruption and underpinned NPI production in China.

As ore reserves in the Philippines dwindled after its previous export rally, the country’s top high-grade nickel ore supplier, SR Languyan Mining Corp, will stop mining in October. This miner is located in Tawi-Tawi region, which suffered from resource depletion and degradation. Another two mines in the region also face potential shutdown between October and November.

In the first half of this year, China imported some 15.5 million wmt of lateritic nickel ore from the Philippines, up 6% on the year, with imports of low-grade ore rising 49%. Imports of medium- to high- grade ore from the Philippines, however, slid 10% year on year, squeezed by a greater market share of Indonesian materials.

Current record high production of NPI in China keeps demand for nickel ore at highs. This may also account for ore supply shortage next year even as minerals from the Philippines enter China as much as possible.

An addition of ore supply in China could only be counted on the new export quotas of French mining company Eramet. The miner obtained 4 million wmt of nickel ore export quotas at its SLN nickel project in New Caledonia in April. Some 1.5 million wmt of quotas could be fulfilled this year, with the rest being delivered by the middle of 2020. This will likely add some 2.5 million wmt of nickel ore supply to China next year, SMM estimates.

NPI supply in China will also face a deficiency of around 100,000 mt in metal content in 2020, even as Indonesian nickel will be moved to China in the form of NPI after the ore ban.

Optimistic estimates for China’s NPI production in 2020 stood at 500,000 mt in metal content, with that in Indonesia at 530,000 mt. This will unable to meet a combined demand for the stainless steel ingredient of 1.13 million mt, including 900,000 mt in China and 230,000 mt in Indonesia, SMM assessed.


Weekly News

Sales Revenue Grows Amidst Global Economy Slowdown

August 27, 2019

PT Indo Tambangraya Megah Tbk. (ITM) recorded growth in total sales revenue in the first half of 2019 amidst global economy slowdown.

The global economy which was under pressure as a consequence of trade war has caused coal demand – mainly from China – to weaken worldwide, resulting in a lower coal price.

Nevertheless, sales revenue went up by 10% to USD 893 million from USD 809 million in the first half in the preceding year. That resulted from higher sales volume by 28% from the same period last year to 12.3 million tons.

However, the company’s net income went down by 31% from USD 130 million in first half of last year to USD 69 million in the same period this year, mainly due to weakening coal price. The average coal price in the first half of 2019 was recorded USD 68.8 per ton, 16% lower from USD 80.9 per ton from the same period last year.

On the other hand, higher sales volume was also parallel with higher coal production volume causing production cost to increase. Furthermore, lower net income was also contributed by higher costs as result of higher stripping ratio as the company in the first half continued optimizing coal reserves by digging deeper.

With lower ASP and higher cost, gross profit margin was recorded 10% lower to 18% versus 28% in the first half of last year while EBIT in this period declined by 42% to USD 96 million. And lastly the net income in the first half of the year was recorded at USD 69 million. Earnings per share during the period was booked at USD 0.006.

By the end of June 2019, ITM’s total assets were valued at USD 1,324 million while total equity was USD 885 million. The company has maintained a strong net cash position of USD 287 million with short term borrowings of USD 4 million.

The company in the first half of this year shipped coal to China (4.0 million tons), Japan (2.0 million tons), Indonesia (1.6 million tons), India (0.8 million tons), Bangladesh (0.6 million tons), and other countries in East, South, and Southeast Asia.

In the first half of 2019, the company produced 11.4 million tons of coal. For 2019, production volume is targeted at 23.6 million tons while our sales volume target has been set at 26.5 million tons, of which 93% has already been sold.

With rapid technology advancements and a fast-changing environment in the energy sector, ITM sees significant potential to use technology, digital capabilities and mindset to create more value for shareholders.

As a result, we have commenced a digital transformation process. The digital transformation is aimed to improve our technology, our mindset and our organization to innovate ways of work, improve products and services and expand into new business potentials. We believe that the result from the digital transformation will be one core key competency to execute our strategies in the years to come.

About PT Indo Tambahangraya Megah Tbk. (ITM)

PT Indo Tambangraya Megah Tbk (ITM) is a leading Indonesian coal producer with integrated business scopes, starting from mining, processing, and logistics activities.

ITM produces thermal coal with various good quality types, making it capable of fulfilling its customer base in Asia, which is large and diverse.

ITM is evolving its business into an energy supplier with affordable, quality, and sustainable products and services by optimizing its value chain from the upstream to the downstream.


Weekly News

PT Timah Will Invest Rp 1.1 Trillion for The Development of Its Ausmelt Smelter in Bangka

PT Timah Tbk (TINS) will invest US$ 80 million (Rp 1.13 trillion) to develop its Ausmelt smelter in Muntok, Bangka.

The funds are obtained from bank loans and bond issuance. However, the company is currently exploring refinancing through a credit scheme with Finterra.

“The final approval will depend on their verification, especially related to environmental issues. They are testing whether this Ausmelt technology will be environmentally friendly and not causing damage,” said Finance Director of PT Timah Tbk, Emil Emindra, at the Indonesia Stock Exchange Building (IDX), Jakarta, on Tuesday (27/8). He said that the agreement was planned fo be signed on next September.

Ausmelt technology is a technology to process tin ore content between 40% -50%.

“Last year we made an innovation, an environmentally friendly mining technology. This year, TINS ​​will increase the capacity of washing tools to accommodate tin ore from community mining,” he added.

In addition, PT Timah also cooperates with the National Nuclear Technology Agency in working on rare earth metals. He said he was currently studying the economic problems of the rare earth project. According to Emil, so far the potential for rare earth is quite large.

This year PT Timah targets metal production of 60 thousand metric tonnes and is able to achieve a net profit of Rp 1.2 trillion.


Weekly News

BUMI Is Optimistic That It Can Reach Its 2019 Production Target

PT Bumi Resources Tbk (BUMI) claimed to remain optimistic that it could produce 87-94 million tonnes of coal by the end of 2019, even though production in the first semester did not reach half of the target.

Dileep Srivastava, Independent Director & Corporate Secretary of BUMI, said that coal production performance usually improves in the second semester. “We will not revise the guidelines until the end of the year,” Srivastava said on Wednesday (28/8) today.

As reported by earlier, BUMI only managed to produce 40-42 million tonnes of coal in semester I. The amount is around 43.62% of the 2019 target.

With this target, BUMI is optimistic that its financial performance will improve. “We are very optimistic about the price of coal until the end of the year,” Srivastava said.


Weekly News

Timah Invests US$ 25 Million in Nigerian Smelter Project

PT Timah Tbk (TINS) is expanding its business to Nigeria by developing a tin smelter in the country. The project is currently in the exploration phase.

TINS acting Corporate Secretary Abdullah Umar Baswedan said that the smelter will have a production capacity of around 5,000 metric tonnes with a US$ 25 million investment. “Our investment for the Nigerian project is still smaller compared to other projects,” he said.

According to Mr Baswedan, the company is synergising with a local partner for the early stage of mining exploration, which will be furthered with smelter development.


Weekly News

Samindo Resources Will Boost Its Operational Performance in The Second Semester

PT Samindo Resources (MYOH) will boost its operational performance in the second semester of this year.

Director of Operations and Development of Samindo Resources, Ahmad Saleh, explained that in the second quarter, rainfall intensity is predicted to be lower than in the first quarter. However, in the field, rainfall intensity continued to increase rainfall in April and June.

“Well, that was the obstacle in our operation. Weather conditions are quite a challenge,” Saleh said during a media meeting in Jakarta on Wednesday (28/8).

Even so, Saleh revealed that MYOH’s financial and operational performance was alright. From the financial side, MYOH recorded an increase in revenue to US$ 120.87 million, or an increase of 8.1% compared to the record in the same period last year. However, the company’s profits fell by 14.52% to US$ 11.3 million compared to the record from the first semester of last year at US$ 13.22 million, due to rising costs.

Meanwhile, until the end of the year, MYOH is aiming for a volume of overburden removal of 58.1 million bcm, and coal production of as much as 10.7 million tonnes.


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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Publications regularly surveyed are: The Jakarta Post, Jakarta Globe, Bisnis Indonesia, Kontan, Coalspot and various online news services.

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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