Orpheus considers legal action against former local coal partner

By Romel S. Gurky

ASX-listed Orpheus Energy Ltd said Friday that it would take legal action against its local partner in Indonesia Nugroho Suksmanto and the Mega Coal Group unless the latter two repay about US$7.23 million debt.

The company said in a statement that it has already sent two rounds of notices to Suksmanto and Mega Coal.

?The third and final round of notices will be issued by December 8, 2014 unless Suksmanto and the Mega Coal Group pay and settle the bebt to Orpheus,? it said in a statement.

?Under Indonesian legal practice, three such notices must be sent prior to the commencement of any formal legal proceedings. In each of the notices, Orpheus has clearly indicated that unless the debt is paid, Orpheus will commence legal proceedings in Indonesia against Suksmanto and/or the Mega Coal Group (both civil and criminal), including but not limited to filing: (i) a petition for declaration of bankruptcy; (ii) a notice of arbitration and/or; (iii) a police report, in accordance with the prevailing laws and regulations,? Orpheus said.

Orpheus announced in July of this year it has signed agreements with Suksmanto and Megal Coal for the sale of its 51 percent interest in six coal assets in Indonesia to the latter two for $8.2 million.

The six entities are PT Daya Mega Citra and PT Daya Mega Pelita (Papua tenements), PT Pelita Dian Petangi (83), PT Pelita Kharisma Kenanga (B4) PT Alam Duta Kalimantan (ADK) and PT Citra Bara Prima (CBP).

But Orpheus said November 10 that collections have been slow with only $965,853 paid so far.

Editing by Reiner Simanjuntak