Raya, Space Con sign HoA for development of geothermal projects in RI
Monday, August 19 2013 - 05:51 AM WIB
ASX-listed firm Raya Group Limited said it has recently signed a Heads of Agreement (HOA) with Australian based Space Con Pty Ltd for the development and financing of Raya?s portfolio of advanced geothermal development projects in Indonesia
The company said in a statement Monday that according to the HOA, Space Con will acquire an 80 percent interest in Raya?s wholly owned subsidiary, Panax Geothermal Singapore #1 Pte.
Space Con will provide the entirety of the equity and project financing / debt funding required for the development of the Indonesian geothermal portfolio.
As consideration for the transaction, Raya will:
? Be entitled to a 20 percent full free carry interest in each of the three Indonesian geothermal development projects; and
? Will receive a cash payment of US$1 million upon the commencement of the development of the first of the three geothermal projects. Space Con?s Managing Director, Mr Raphael Shin, will be appointed as the Chairman and Managing Director of Panax Singapore, with immediate effect.
Space con is an Australian company based in Sydney which designs and develops large scale commercial and infrastructure projects in Australia and internationally. The company has access to funds for large mining, resources, and infrastructure projects via its Korean Investment partners.
Commenting today, Raya Chairman Athan Lekkas noted ?This is an extremely significant step forward for the development of our Indonesian geothermal portfolio, providing development and funding certainty for the portfolio of projects, and ensuring Raya is fully funded on a go-forward basis for its share of the development costs?.
Lekkas went on to note that ?This is a stamp of approval for the significant effort that has been put in to date in securing our portfolio of projects in Indonesia, and provides a benchmark for valuing the portfolio of projects that we have. We look forward to working with Space Con in developing the projects, and unlocking the real value that is there for the benefit of our shareholders?.
Under the terms of HOA, Raya and Space Con have a period of 90 days to execute the required formal agreements arising from the HOA and to complete any remaining commercial due diligence.
As noted in recent ASX announcements, Raya is also currently in the process of identifying and securing a complimentary pipeline of project opportunities for the company.
Raya has completed a detailed review and due diligence of a number of potential project opportunities (comprising both energy and precious metals projects) within Indonesia and within other countries, with the main emphasis on improving shareholder wealth.
Raya Group, formerly known as Panax Geothermal Limited, has a number of geothermal projects in Indonesia including Dairi Prima Project, Ngebel Project, Sokoria Project and Jambi Geothermal Project.
Editing by Reiner Simanjuntak