Chameleon to develop manganese project in Kupang

By Romel S. Gurky

Australia-listed firm Chameleon Mining has entered into a conditional heads of agreement to acquire a 55 percent share in a significant manganese project currently owned by MKI, an Indonesian limited liability company, with potential for early production from its Kupang Project.

The Kupang Project is located in West Timor, in the Indonesian province of Nusa Tenggara Timur, a region well known globally as a source of high-grade (+46% Mn) Manganese ore.

Subject to satisfaction of a number of conditions precedent, in consideration for payment of A$3.5 million, Chameleon through a wholly owned subsidiary will acquire 100 percent of NTT Manganese Pty Ltd (NTT) which holds a 30 percent interest in PT Kupang Resources, which following a restructure, will indirectly hold 100 percent of the rights to manganese produced from the Kupang Project.

NTT's interest in the Kupang Project is held via an incorporated joint venture structure with the MKI, named Kupang Resources Joint Venture. NTT will then increase its interest in the joint venture to 55 percent following the restructure through the expenditure of a further A$6.5 million.

The remaining interest in the Kupang Resources Joint Venture is held by three local Indonesian stakeholders.

Completion of the transaction is subject to and conditional upon a number of conditions that include finalization of due diligence by Chameleon on NTT, Kupang Resources and the Kupang Resources Joint Venture to its satisfaction, and executing a formal share purchase agreement in relation to the transaction.

On satisfaction or waiver of the last of the Conditions, Chameleon will pay the A$3.5 million consideration to the vendors of NTT which will acquire a 30 percent interest in the Kupang Project via NTT's joint venture holding.

Chameleon (via NTT) will then increase this holding to 55 percent upon the spending of a further A$6.5 million in expenditure.

Editing by Er Audy Zandri