Asiamet Resources Ltd (AIM:ARS, OTC:KMGLF) is advancing its BKM copper project in Central Kalimantan, Indonesia, said it is on track with its financing plans, involving senior bank debt and prepayment finance through to a possible copper cathode offtake.
An Independent Technical Expert (ITE), SRK Consulting (Perth), is nearing the completion of its review report, which will be submitted to the potential lead bank within a fortnight.
It is expected to reflect positively on the project's feasibility, addressing items raised in previous reviews. Concurrently, Grant Samuel, the company's corporate adviser, is working closely with the potential lead bank to finalise the project's financial model and valuation metrics.
"We are pleased to report the appointed ITE has completed their technical review of the BKM Copper feasibility study update and provided their report for ARS' comment," said Asiamet chief executive Darryn McClelland.
"This is going through a final review process with report to then be provided to the proposed lead bank to support their due diligence and financial modelling activities. This is a critical step in moving forward with the process to secure bank financing for BKM."
In the corporate update, Asiamet said it had also received an indicative term sheet from a major international metals trading group for prepayment financing following a thorough due diligence process. It said it is in active discussions with other commodity trading groups for similar financing options.
On the operational side, Asiamet is in talks with several Chinese engineering, procurement and construction, and EPC management groups for project execution.
A decision is expected in the fourth quarter of 2023. Earthworks for improving the main forestry access road to the mining site are well underway, which is crucial for the project's execution.
At the same time, the company is in the final stages of securing a change of forestry use operational permit, which will enable various site activities.
Amid a limited number of advanced copper projects in the region and uncertainties in future copper supply, Asiamet has attracted interest from several Asian companies looking to invest in the BKM project, thereby promising fair and reasonable value for stakeholders.
"It is encouraging also to report receipt of an indicative term sheet for copper cathode offtake finance from an internationally recognised metals trading group. Whilst preliminary, and subject to various conditions precedent, this represents a significant step forward in the overall financing journey," said CEO McClelland.
"Offtake finance remains a key part of the overall project finance package bringing considerable benefits for both the project and shareholders. Due diligence is ongoing with other potential offtake partners also hoping to secure the copper cathode units that Asiamet will bring into production."