Bumi issues convertible bonds to fund Sulawesi gold projects

JSX-listed PT Bumi Resources through its wholly–owned subsidiary, Enercoal Resources Pte. Ltd., has issued convertible bonds worth US$150 million to raise funds for financing gold and copper project as part of its expansion program.

 

Bumi’s senior vice president for investor relations Dileep Srivastava said in Jakarta Friday that the convertible bonds will have a maturity of five years, with Credit Suisse as underwriter.

 

According to Dileep, the bond will give yield 8.125 percent per year and is convertible to Bumi shares, with conversion rate of Rp3,250 per share.

 

Dileep said that the proceeds would be used for financing the pre-mining and gold and copper exploration projects in Gorontalo, Palu mines in Sulawesi and in Mauritania.

 

Currently, the Gorontalo project is still in the stage of determining the gold reserves, he said, adding the project is expected to produce gold beginning 2011.

 

For the Palu project, Bumi had reported a gold reserves of two million ounces, but the company continued to conduct exploration activities to find more gold and other new minerals. The project is also expected to produce gold in 2011, Dileep said last month.

 

Elsewhere, Dileep said that part of the proceeds would also be used to finance drilling and exploration activities on oil and gas concession in Yemen owned by Bumi’s subsidiary Gallo Oil ltd. (denny)