Nusantara Resources Ltd. clarified that is still looking for funds to develop the Awak Mas gold project in Indonesia after a local news outlet reported that PT Indika Energy Tbk was seeking US$200 million in project financing and was open to raising its company stake from 19.9%.
Under a December 2018 deal, Nusantara and Indika agreed to explore options to complete financing, with a provision for Nusantara to possibly offer Indika an interest of not less than 25% in project holder PT Masmindo Dwi Area after the completion of an updated feasibility study.
Indika dismissed the report as inaccurate, saying that nothing was discussed with the journalist about project financing. It also noted that its rights to the project were misinterpreted as a declared intention to increase its stake.
Nusantara said Sept. 5 that it continues to engage with Indika and alternative parties over project financing, although discussions have not yet advanced to any formal term sheet.
An October 2018 definitive feasibility study for Awak Mas defined a post-tax net present value, discounted at 5%, of US$152 million, a 20.3% internal rate of return, and a four-year payback period.
