- Cokal’s (CKA) part-owned subsidiary, Bumi Barito Mineral, enters a new US$20 million (A$26.81 million) debt facility to boost funding for its Indonesian coal operations
- The new arrangements with Singaporean International Commodity Trade are hoped to develop its namesake coal project and push international marketing
- Cokal has in turn forsaken its preexisting funding arrangement with global powerhouse China Railway Construction Corporation
- Broadly, Cokal affirms securing the facility from International Commodity Trade is “attractive and fair” for shareholders
- Cokal shares are up 18 per cent and trading at 7.2 cents
Cokal’s (CKA) part-owned subsidiary, Bumi Barito Mineral, has entered a new US$20 million (A$26.81 million) debt facility in a bid to boost funding for its Indonesian coal operations.
The company has executed two binding agreements — a capital participation agreement and an international coal marketing agreement — with Singapore-based International Commodity Trade.
In accepting this new deal, Cokal has forsaken a preexisting binding arrangement with subsidiaries of one of the largest construction and engineering companies in the world, China Railway Construction Corporation.
In its rationale for the move, Cokal said Covid-19 travel restrictions and security requirements for the previous funding had adversely affected its ability to drawdown on this debt finance.
Broadly, Cokal affirms securing the facility from International Commodity Trade is “attractive and fair” for shareholders.
Specifically, the funding is set to go towards the Bumi Barito Mineral coal project situated in the Central Kalimantan Province of Indonesia. Cokal owns a 60 per cent stake in the project.
The binding International Coal Marketing Agreement with ICT is hoped to aid Bumi Barito Mineral market its coal to the international market and assist BBM in financing its coal stockpile at the river jetty.
The subsidiary has in turn agreed to provide international coal marketing rights to International Commodity Trade for said marketing arrangement.
Cokal shares were up 18 per cent and trading at 7.2 cents at 11:12 am AEST.