Merdeka unit signs hedging facility with three lenders

By Ruli Setiawan

IDX-listed PT Merdeka Copper Gold Tbk said that is subsidiary PT Bumi Suksesindo (BSI) had on March 15 signed a facility to hedge its gold and copper sales value with three lenders.

Merdeka said in a statement that the hedging facility was signed with Societe Generale Asia Ltd, BNP Paribas, and HSBC.

The hedging facility is part of the requirement set by the three international lenders as condition for a total US$130 million loan agreement signed in February of this year amid the lingering volatility in commodity prices.

Merdeka will use the loan to help finance the development of its Bukit Tujuh gold mining project in Banyuwangi, East Java, and has put BSI as collateral.

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.

Editing by Reiner Simanjuntak