Krakatoa in Lampung, Sulawesi iron ore mines venture

By Romel S. Gurky

ASX-listed firm Krakatoa Resources Limited announced on Friday that a Memorandum of Understanding (MOU) has been signed with Tiga Serangkai Group whereby Krakatoa?s Indonesian subsidiary has gained exclusive rights to assess, explore, acquire, joint venture, or offtake iron ore from the following pipeline of iron ore tenements, which are ultimately 100% owned by Tiga Serangkai:

IUP	Name	Location	Area
Production	CBL Tenement	Tanggamus Regent, Lampung Province	121ha
Exploration	BAS Tenement	Tanggamus Regent, Lampung Province	100ha
Exploration	HAT Tenement	Tanggamus Regent, Lampung Province	150ha
Exploration	SFP Tenement	Tanggamus Regent, Lampung Province	144ha
Exploration	BMS Tenement	Bone Regent, South Sulawesi Province	384ha

Lampung Province Tenements
The CBL Production IUP is situated in Samanka Bay, Lampung. CBL is currently stockpiling iron ore on the tenement using the on-site crushing plant. The mining area is located approximately 1 km to Tiga?s jetty where ore can be loaded directly on to barges for transport of 115 km across the Sunda Strait to Sitasa Group?s existing customer, the Krakatau Posco Steel Plant.

The 3 Exploration IUP?s in Lampung are also in the immediate area surrounding the CBL Production IUP and provide a combined area of 515ha.

The tenements in Tanggamus Regency in Lampung are located in a highly strategic area for mining and production of iron ore. They are located practically adjacent to a natural harbour where the Tiga group has constructed its own Jetty and loading area.

Exploration Activities
Krakatoa will begin exploration activities on the Lampung tenements immediately, with remote sensing, preliminary logistics investigation, site visit, sampling and review of geology and existing data initially planned.

Key Terms of the MOU
Should exploration activities on any of the IUP?s be successful, Krakatoa can exclusively negotiate with Tiga to:
a. Acquire the IUP;
b. Enter into a Joint Venture on the IUP;
c. Have an exclusive off-take on the IUP;
d. Do a combination of points a, b and c above.

If Krakatoa elects not to take any further action once the exploration activities are completed, Tiga Serangkai has agreed to pay 50% of the total cost incurred by Krakatoa in obtaining the exploration data.

Editing by Alexander Ginting