Asiamet Receives Production Licence for 5.3Blb Cu, 2.1Moz Au Beutong Project
Asiamet Resources Limited (“ARS” or the “Company”) is pleased to announce that PT Emas Mineral Murni (“EMM”) has been granted the key production licence, Izin Usaha Pertambangan Operasi Produksi “IUP-OP” required to advance the Beutong Copper-Gold Project (“Beutong”) to the development stage. Beutong is located in Nagan Raya Regency, Aceh, Indonesia.
· A major de-risking milestone for the Beutong project securing long-term licence for +20 years
· Beutong is a large high-quality copper, gold, silver, molybdenum deposit which outcrops at surface and remains open in several directions including to depth. Current JORC compliant Resources contain 2.4Mt (5.3BIb) copper, 2.1Moz gold and 20.6Moz silver
· Geology indicates potential for the discovery of a deep high-grade copper-gold zone similar to that seen in some of the giant Asia-Pacific porphyry systems
· Asiamet has a 40% equity interest in the Beutong Project which subject to meeting certain expenditure and site based activity milestones can increase to 80%.
· The Beutong deposit is very well located with respect to existing infrastructure i.e. adjacent to a sealed road and approximately 60km from a large power station and seaport
· The forestry status of the project area is Areal Penggunaan Lain (“APL”) or “forestry other purposes” allowing drilling related development activities to commence immediately
The Beutong Project
Beutong is a large porphyry copper-gold system, which comprises the Beutong East Porphyry (“BEP”), Beutong West Porphyry (“BWP”) and the Beutong Skarn(“BSK”) as shown in Figure 1. Beutong has current JORC compliant Resources containing 2.4Mt (5.3Blb) copper, 2.1Moz gold and 20.6Moz silver on a 100% basis and 1.0Mt (2.1Blb) copper, 0.8Moz gold and 8.2Moz silver on a 40% attributable basis (see announcement dated 26 November 2014). The surface mineralisation at BEP and BWP comprises chalcocite, covellite and digenite mineralisation with lesser chalcopyrite.
At 600m-700m depth there is a notable transition to chalcopyrite-bornite mineralisation, similar to the deeper sections of other porphyry systems in Southeast Asia such as the giant high-grade Grasberg Indonesia (Freeport-McMoRan Copper & Gold), Wafi-Golpu PNG (Newcrest Mining) and Tujah Bukit Indonesia (Merdeka Resources) porphyry deposits. At depth in the BEP, large clasts of potassic altered (biotite, potassic feldspar and magnetite) diorite porphyry with intense stockwork chalcopyrite-bornite mineralisation (Figure 2) occur within a diatreme breccia and are interpreted to have been transported from a high-grade potassic core at depth. The BEP and BWP systems remain open in several directions and the interpreted BEP high-grade core remains untested at depth.
Better intersections from diamond core drilling undertaken at Beutong by Tigers Realm Metals between 2011-2013 include:
Beutong East Porphyry
320.4m @ 1.11% Cu, 0.19g/t Au from 6.6m Depth (349.9m EOH)
374.4m @ 0.89% Cu, 0.20g/t Au from 4.8m Depth (794.5m EOH
187.0m @ 1.03% Cu, 0.18g/t Au from 4.8m Depth
150.5m @ 0.78% Cu, 0.17g/t Au from 558.4m Depth
332.7m @ 0.73% Cu, 0.14g/t Au from 123m Depth (459.2m EOH)
Beutong West Porphyry
155m @ 0.62% Cu, 0.13g/t Au from 168m Depth (1592.3m EOH)
129m @ 0.52% Cu, 0.19g/t Au from 584m Depth
43.9m @ 1.05% Cu, 0.33g/t Au from 149.6m Depth (239.1m EOH)
33.0m @ 2.47% Cu, 1.23g/t Au from 48.0m Depth (150.0m EOH)
21.8m @ 0.87% Cu, 0.40g/t Au, 6.3% Zn, 1.8% Pb from 119.0m Depth (140.8m EOH)
Notes: End of Hole (“EOH”)
Over the past two years the Company and our Indonesian partner Media Mining Resources have worked diligently with relevant Indonesian authorities to progress the IUP Exploration conversion to an IUP-OP permit, particularly with Ministry of Energy and Mineral Resources (“ESDM”) in Jakarta and the local government of Nagan Raya Regency. The support for the project from the local and central government administrations and the local community provides a firm basis for the further development of Beutong.
The conversion of EMM’s IUP Exploration license to an IUP-OP license is a major step in advancing the Beutong project. It provides for an initial 20 years of licence tenure which may be extended twice, each for a period of 10 years, totalling 40 years.
Asiamet has a 40% equity interest in the Beutong Project and can increase its interest to 80% based on various payments and milestones. A consideration to the value of A$2,875,000 will be due within 90 days of the grant of the production IUP to increase its interest to 60%. Completion of a Feasibility Study and a further payment of A$1,500,000 are the final conditions to increase its equity interest to 80%.
As part of the IUP-OP grant EMM is committed to meeting in-country processing requirements and will pursue opportunities for copper metal production via heap-leach, SX-EW while simultaneously commencing discussions with several companies that have pledged to build local smelters to process copper concentrate.
A drill rig will soon be mobilised to advance development of the project. Several drill holes have been designed to provide critical information on the structure and distribution of high-grade near-surface mineralisation, test the strike and depth potential of the Beutong system, and fulfil our commitments in respect of the IUP-OP permit including:
· Carrying out feasibility-level metallurgical test-work focused on determining the leachability of the secondary copper sulphide minerals (chalcocite, covellite, and digenite) that dominate the upper 600m of the Beutong porphyry system;
· Determine the leachability of the chalcocite and oxide copper minerals (malachite, azurite and brochantite) that occur in the upper 80 meters of the Beutong Skarn;
· Using metallurgical test-work results, evaluate the potential for a large scale SX-EW mining operation at Beutong, to produce Grade A Copper cathode;
· Obtain additional geotechnical data within the proposed open pit at Beutong East porphyry, as defined in the Indonesian Feasibility Study.
KSK Contract of Work (“CoW’) Update
As previously advised (ARS NR Aug 21, 2015) KSK signed a non-binding Memorandum of Understanding (“MOU”) with the Government of the Republic of Indonesia (“GOI”) and was continuing discussions with the GOI regarding amendments to some of the KSK CoW terms in order to achieve closer alignment with the current Mining Law No. 4/2009. These discussions with the GOI have been ongoing but, somewhat fragmented, over the past two years while the GOI has dealt with other higher priority issues. However, finalising the potential amendments outlined in the MOU are an important part of securing the platform upon which the Company can progress project financing for the potential development of the BKM copper project now in the later stages of a Bankable Feasibility Study. Asiamet is currently working with the GOI to finalise the terms of the amendments to the KSK CoW to provide the certainty required to enable project financing and project development to commence in 2018. The potential amendments outlined in the MOU cover six key area’s (refer ARS NR Aug 21, 2015) and are aligned to Asiamet’s long-term strategy of partnering with reputable Indonesian investors to develop its projects and support the GOIs endeavours to build its economy.
Peter Bird, Asiamet’s Chief Executive Officer commented:
“Asiamet is extremely pleased to report receipt of the IUP-OP for its large Beutong copper-gold project. This is a major milestone for the Company which secures long-term licence tenure for Beutong and enables detailed evaluation and development of its second large copper-gold project to progress at a time when the copper market is forecast to move into deficit, copper prices are rising and new projects especially those of considerable scale are in short supply globally. The diligence and hard work of our local team, and especially our partner and the various Indonesian government departments, officials and stakeholders is greatly appreciated.
“The Beutong deposit outcrops at surface and remains open in multiple directions including to depth where the geology indicates potential for the discovery of a deep high-grade copper-gold zone similar to that seen in some of the giant Asia-Pacific porphyry systems. Beutong is favourably located from a transport and logistics and general infrastructure perspective. These factors have the potential to impact development economics favourably. As development activities incorporating evaluation drilling, metallurgy and geotechnical activities are ramped up at Beutong, Asiamet looks forward to progressively reporting results in parallel with ongoing Feasibility Study work at the BKM copper project and further exploration at the BKZ polymetallic project. Very strong news flow can be anticipated as we advance into 2018 and as we continue to explore and develop our portfolio of high-quality copper, gold and polymetallic projects together with our Indonesian partners and stakeholders.
“We are also pleased that negotiations aimed at finalising amendments to the KSK CoW and providing the certainty required for proceeding the BKM copper project to the project financing and development phase in 2018 are nearing completion.”
Data disclosed in this press release have been reviewed and verified by ARS’s qualified person, Stephen Hughes, P. Geo, Vice President Exploration of the Company and a Qualified Person within the meaning of NI 43 -101 and for the purposes of the AIM Rules.
ON BEHALF OF THE BOARD OF DIRECTORS
Peter Bird, Deputy Chairman and CEO
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