EMR offloads Indonesia gold-silver mine

EMR Capital and its partners have agreed to sell the Martabe gold-silver mine in Indonesia for US$1.21 billion.

Staff reporter


EMR, Farallon Capital and other partners hold 95% of the mine.

The stake will be purchased by PT Danusa Tambang Nusantara, a company controlled by by PT United Tractors Tbk and PT Pamapersada Nusantara.

Martabe is one of Asia's largest gold mines with reserves of 4.7 million ounces of gold and 36Moz of silver, and resources of 8.8Moz of gold and 72Moz of silver.

The mine produced 355,000oz of gold and 2.8Moz of silver last year at all-in sustaining costs of $406 an ounce of gold.

EMR CEO Jason Chang said significant growth had been achieved at Martabe under the company's ownership.

"Throughput and gold and silver produced have substantially increased, reserves have doubled, and AISC is now amongst the lowest in the world," he said.

"The management team and all employees at Martabe have done an outstanding job during EMR ownership of the operation, particularly in relation to environmental performance and social and community relations, which are absolutely world-class."

EMR and its partners acquired the mine in 2016 for $775 million.

It was acquired from Hong Kong-listed G-Resources, of which EMR co-founder Owen Hegarty was deputy chairman at the time.

Hegarty had a long involvement with the project, with his company Oxiana picking up the project in 2007.

Oxiana became OZ Minerals in 2008 and the company ran into debt troubles, forcing it to sell Martabe to China Sci-Tech Holdings (now CST Mining) for $211 million.
CST, of which Hegarty was a director, granted G-Resources an option to purchase the project for $220 million a few months later, which was exercised.

Hegarty was present in 2012 when the $600 million project poured its first gold.

Meanwhile, Chang said Indonesia was an important market for the company and it was currently assessing a number of other opportunities there.

"We are committed to our investment strategy and will continue to grow investor value across our expanding project portfolio by utilising our industry experience, expertise and networks."

EMR has nine investments worldwide across copper, gold, hard coking coal and potash.

The Melbourne-based firm recently completed the $2.25 billion acquisition of 80% of Rio Tinto's Kestrel mine as part of a consortium with Adaro Energy.


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