Kalimantan Gold Corporation has signed a non-binding letter of intent with Tigers Realm Copper, a private Australian corporation within the Tigers Realm Group of companies, to purchase Tigers’ interest in the Beutong copper-gold project in Sumatra.
The consideration for this acquisition will be the issue of more than 171.4 million Kalimantan Gold common shares, valued at around 3.2 million pounds, and 14.675 million share purchase warrants. In return Kalimantan will take ownership of 40% of the project.
Beutong’s mineral resource comprises measured and indicated resources of 93 million tonnes @ at 0.61% copper, 0.13ppm gold, 1.97ppm silver and 97ppm molybdenum for contained metal of 1.241 million pounds of copper, 373,000 ounces of gold, 5.698 million ounces of silver and 20 million pounds of molybdenum.
There are also inferred resources of 418 million tonnes @ 0.45% copper, 0.13ppm gold, 1.11ppm silver and 129ppm molybdenum for contained metal of 4.092 million pounds of copper, 1.746 million ounces of gold, 14.903 million ounces of silver and 112 million pounds of molybdenum.
The Beutong interest will complement Kalimantan Gold’s existing assets. There is a small-medium scale, near-surface copper opportunity at Beruang Kanan with potential to be the starter project; a large copper-gold growth option at Beutong; and a highly prospective copper and gold exploration portfolio.
Highly experienced resource industry CEO Tony Manini will join the company as deputy chairman and CEO. This appointment and the Beutong acquisition means the company will have available to it extensive project evaluation, mine development and financing capability, and experience.
Kalimantan Gold’s current deputy chairman and CEO Faldi Ismail, who will remain as a director, says, “The acquisition of Beutong, combined with the company’s own KSK copper mineral resource and its Jelai gold prospect creates a quality portfolio of pre-development copper and gold assets all located within Indonesia.
“All three projects have significant growth potential and their combination will create a platform upon which to continue to build a significant regional Asian focused copper-gold business. We are looking forward to working with Tony in our efforts to raise the necessary funding to progress the company’s projects. It is expected that the combination of projects and a team with a strong track record in developing projects in the Asia-Pacific will be well supported by investors.”
The principal terms of the letter of intent provide that during a 20-day due diligence period the parties will negotiate a definitive agreement. Kalimantan Gold is also undertaking a concurrent equity placement for gross proceeds of not less than US$3 million. It is intended that the proceeds of the capital raising will be used to fund the company's next phase of infill and expansion drilling and metallurgical studies at the existing Beruang Kanan prospect within the KSK Contract of Work in Kalimantan and on finalizing conversion of the Beutong IUP from an exploration IUP to an exploitation IUP.