Merdeka seeks up to $130m loan

By Thomas Sembiring

IDX-listed mining firm PT Merdeka Copper Gold Tbk is seeking up to US$130 million loan from syndication of foreign banks to among others help finance the development of its Bukit Tujuh gold project in Banyuwangi, East Java.

The company on Monday obtained shareholders approval to put up its subsidiary PT Bumi Suksesindo (BSI) as collateral. ?With this approval, the company will have greater room to achieve its targets. We?re optimistic of the positive prospects of gold and mineral mining business,? said Merdeka Copper President Adi Adriansyah Sjoekri.

BSI holds permit for the Bukit Tujuh concession. According to 2012 JORC, the Bukit Tujuh mine holds ore reserves of 90 million tons in its oxide layer. The project is expected to produce 90,000 ounces of gold and 300,000 oz of silver per year from late 2016 to 2025.

Corporate Secretary Ellie Turjandi said that the loan agreement is expected to be signed in January of next year, partly to be used to help finance the 2016 capital expenditure plan of $126.5 million.

Merdeka raised about Rp 819 billion ($62.1 million) in proceeds from selling 21.7 percent shares via an initial public offering (IPO) in June of this year. The company has so far used about 53 percent of the IPO proceeds.

Merdeka is the first mining firm under exploration stage to launch IPO following a new relaxed regulation introduced by the Indonesia Stock Exchange.

Editing by Reiner Simanjuntak