bumi resources minerals - Photo by the Company

JAKARTA (TheInsiderStories) – Indonesian publicly listed miner PT Bumi Resources Minerals Tbk (IDX: BRMS) through its Singapore’s unit Gain and Win Pte. Ltd., completed the 51 percent share sales of PT Dairi Prima Mineral to China Nonferrous Metal Industry’s Foreign Engineering and Construction Co (NFC) for US$198 million, said the company on Monday (24/09).

Dairi Prima is a zinc-lead silver mining producer located in Dairi district, North Sumatra, and has estimated total resources of about 25 million tons of ore.

Previously on April 16, 2018, BRMS and NFC had met in Beijing and voted to approve the acquisition of 51 percent of Dairi Prima as per the terms of the June 2017 Conditional Share Purchase Agreement. Presently, BRMS owns 100 percent of Dairi Prima after acquired 20 percent interest from state-owned miner PT Aneka Tambang Tbk (IDX: ANTM) for $57.3 million.

Recently, Andrew Neale, the CEO and President Director of BRMS commented, this agreement marks the first time NFC has invested in the Indonesian mining sector and attests to the mineral wealth of this country.

According to BRMS corporate secretary Muhammad Sulthon in a written statement on Monday (24/09), after the divestment gives NFC a controlling stake in Dairi Prima, while BMRS owns the remaining 49 percent.

The chief financial officer Fuad Helmy added, BRMS expects to reduce its debt to an estimated $53 million following the divestment deal. As of first semester of 2018, the company’s debt stood at $161.31 million.

Dairi Prima has obtained a 30-year production permit for Dairi Lead-Zinc Mine in North Sumatra on Dec. 18, 2017. The construction of the Dairi Prima zinc mine will take 22 months and is expected to start producing by the end of 2019.

Construction of the mine, located in Sidikalang, North Sumatra, is expected to require an investment of $350 million, most of which will be obtained from banks in China. The Dairi deposit, is one of the premiere underdeveloped lead-zinc deposits, contains an estimated 1.2 million tons of zinc, 0.7 million tons of lead and over 3 million ounces of silver.

The deposit will be extracted using a combination of underground mining and a conventional processing plant comprised of crushing, grinding, and differential froth flotation to produce separate lead and zinc concentrates.

The expected ore production, according to the feasibility study, will be 1 million tons of ore per annum (approximately 3,000 t/day). A second resource on the same concession known as Lae Jahe is expected to contain a similar amount of zinc, lead and silver. In addition to zinc sulfide ore, the company will also mine secondary ores such as galena, which is the mineral form of lead sulfide and silver.

The company holds a Contract of Work (CoW), which was granted by the government on Feb. 18, 1998. Under the term of the CoW, the company may explore for minerals in a 27,420-hectare area, located in North Sumatra and Nangroe Aceh Darussalam provinces.

In July 2012, the government issued the company a so-called Borrow-Use Permit that clears the way for them to commence the development and production of the mine.

Dairi Prima’s Anjing Hitam and Lae Jahe Projects have 11 million tones of ore reserves, and it has one of the highest grade of Zinc deposit in the world (11.5 percent Zn ,6.8 percent Pb). The Anjing Hitam, Lae Jahe, Base Camp projects have significant resource base of 25 million tones of ore which is inclusive of reserves.

Written by Staff Editor, Email: theinsiderstories@gmail.com