Finders Resources has secured offtake partners for 100% of the copper cathode from its Wetar project on Indonesia’s Wetar Island. An offtake agreement has been signed by Standard Bank for up to 60% of all copper cathode from Wetar while Tenant Metals previously signed an agreement to market 40% of offtake.
Standard Bank will subscribe US$5.5 million in mandatory convertible notes for equity in Finders, in exchange for the right to buy up to 40% of the Wetar copper offtake. Finders will use the funds to finance the Wetar project and its near-term capital expenditure requirements. The equity investment will convert into ordinary shares in Finders during the next six years.
Another term of the agreement will see Standard Bank pay prevailing market prices for the copper cathode produced at Wetar for the life of the mine.
Standard Bank has also committed to a further US$5.5 million tranche to fund construction of Wetar, at which time the bank will also secure rights to a further 20% of the copper offtake. This agreement follows a commitment by Standard to also take part in the US$138 million finance facilities for Wetar.
Finders managing director Chris Farmer says the agreements are a major vote of confidence in the project. “Standard Bank is a respected international bank and is experienced in funding resource projects around the world. They have made a significant long term commitment to Finders through both debt and equity funding after extensive due diligence and review.
“I am delighted to further entrench the partnership between Finders and Standard Bank and look forward to working closely with them over the long term.”
Government rezoning of the remote forest area which takes in Wetar was announced earlier this month, paving the way for Finders to continue development of the 8.2 million tonne project which is in the island’s central north.