Asiamet receives production licence for 5,300 Mlb Cu, 2.1 Moz Au Beutong project

Asiamet Resources Ltd reports 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 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 2.4 Mt copper, 2.1 Moz gold and 20.6 Moz 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

Beutong is a large porphyry copper-gold system, which comprises the Beutong East Porphyry (BEP), Beutong West Porphyry (BWP) and the Beutong Skarn (BSK). The surface mineralisation at BEP and BWP comprises chalcocite, covellite and digenite mineralisation with lesser chalcopyrite.

At 600-700 m 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.

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 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 m 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.

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.”