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Corporate Spotlight

A pioneer producer of premium manganese in Indonesia, Gulf Manganese is fully-funded from construction through to first production. Gulf utilises the highest quality manganese ore in the region to generate exceptional quality ferromanganese to supply the high-demand Asian market.
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Gulf Manganese Interview with Hamish Bohannan


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Gulf Secures €52 Million Loan Facility to Complete Kupang Smelting Hub Construction Program

ASX Announcement 8 January 2020 

  • Gulf will now be fully funded to complete the construction and commissioning of first two smelters at Kupang Smelting Hub - funds expected to be received by the end of January 2020 
  • Kupang Smelting Hub construction program to re-start immediately – expected timeframe for completion of first two smelters and pouring of first metal is Q3 2020 
  • Gulf to accelerate high-grade manganese mining operations with Indonesian partners 
  • Funding also enables Gulf to advance strategic joint venture with Iron Fortune – providing a first-mover manganese exploration opportunity in Timor Leste

Gulf Manganese Corporation Limited ("Gulf" or the "Company") (ASX: GMC) is pleased to advise that it has executed a binding term sheet for the establishment of a €$52 million Structured Loan Facility (the "Loan Facility") with Glacier International Depository Ltd, Legal and General Investment Management Limited and HSBC Bank plc. The Loan Facility is presently being finalised with proceeds expected to be received by the end of January 2020. 

In contractual terms, the two key parties to the transaction are HSBC Bank plc as provider of the underpinning collateral, a Standby Letter of Credit, and Legal and General Investment Management Ltd as provider of the loan itself, with the assistance of Glacier International Depository Ltd, who are responsible for preparing and handling of the instrument issuance in raising and providing of the funds for Gulf.

Gulf will now be fully funded to complete the construction and commissioning of the first two smelting furnaces at the Kupang Smelting Hub facility in West Timor, Indonesia. As previously reported, construction of the facility is currently 60% complete, with approximately US$13 million and a further 6-7 months’ work required to complete the first two smelting furnaces. 

This Loan Facility also provides Gulf with the ability to ramp-up its high-grade (+49% Mn) manganese mining and exploration activities in Indonesia taking advantage of its licence to export manganese concentrate (also known as Direct Shipped Ore or “DSO”), and to advance its strategic joint venture with Iron Fortune in Timor Leste.

Regular detailed updates on construction milestones, mining activities and exploration progress will be provided to shareholders as activity ramps-up across the business over the coming months.

Click here to view the full announcement


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Gulf to Acquire Strategic Interest in Timor-Leste Manganese Explorer 

ASX Announcement 2 August 2019

  • Acquisition of a 20% interest in Australian-based Iron Fortune Pty Ltd to provide Gulf with a first to market exploration opportunity in Timor-Leste 
  • Significantly diversifies and de-risks high-grade manganese ore supply chain through farm-in exposure to Timor-Leste exploration areas prospective for high-grade manganese 
  • Iron Fortune’s strong local relationships and geological understanding of the Timor-Leste region provides an excellent opportunity to expand Gulf’s manganese footprint outside of Indonesia

Gulf Manganese Corporation Limited (ASX: GMC) (“Gulf” or “the Company”) is pleased to advise that it has entered into an agreement to acquire a strategic 20% interest in Iron Fortune Pty Ltd (“Iron Fortune”), a private Australian-based minerals and exploration company focused on Timor-Leste.

Under the terms of the agreement, Gulf will pay an initial A$100,000 for exclusivity whilst due diligence is completed and has agreed to work together with Iron Fortune to develop a work plan and strategic direction. Hamish Bohannan will also be appointed to the Board of Iron Fortune in the position of NonExecutive Director. Upon completion of the due diligence process, Gulf will pay a further A$200,000 and issue A$100,000 worth of shares to secure a 20% interest in Iron Fortune.

Full terms and conditions have been outlined below.

Gulf Managing Director, Hamish Bohannan, commented, “Gulf’s investment in Iron Fortune underpins our vertically integrated mine-gate to production acquisition strategy and provides an excellent opportunity to diversify our asset base beyond Indonesia, whilst remaining in a common geological region.

“Importantly, this partnership can significantly de-risk our ore supply chain and gives the Company an enviable first mover advantage in this emerging exploration jurisdiction. Further, with Iron Fortune’s established and respected presence in Timor-Leste, Gulf has the potential to quickly expand its highquality manganese mining footprint and processing capabilities to support the ongoing development of our Kupang Smelting Hub facility. 

Iron Fortune Director, Ian Sinclair, said, “We are proud to be the first minerals exploration company in Timor-Leste. This new partnership with Gulf will leverage their technical and geological skill base in the Timor region and help us to accelerate both exploration and manganese mine development. We are encouraged that our five-year investment focus on Timor-Leste has been recognised by Gulf and supports our effort to be at the forefront of minerals exploration in Timor-Leste.

Figure 1: Location of Gulf’s Kupang Smelting Hub Facility in relation to Timor-Leste 

Timor-Leste Opportunity Overview 

The Democratic Republic of Timor-Leste is 700km northwest of Darwin, with Dili as its capital. The country achieved independence in 2002 and has a young population of 1.2 million, with 65% of citizens under 25. Catholicism is the predominant religion (95%). The US dollar was adopted as the official currency in 2000, in part to stimulate foreign investment and ease of business to grow the economy. Oil and gas revenues account for 70 per cent of the nation’s GDP and almost 90 per cent of total government revenue between 2010 and 2015. In 2011, the Petroleum Fund was valued around US$16 billion.

The Government of Timor-Leste has an ambitious plan to use the nation’s oil revenue to support long-term economic development based on diversifying the economy away from a reliance on oil. This is already in action through leading Australian and international companies carrying out major projects and investing in the minerals and resource sector. ¹

The finalisation in 2018 of the maritime boundary treaty between Australia and Timor-Leste was a significant milestone and has further strengthened the relationship between the two countries. It is the view of both Gulf and Iron Fortune that finalisation of the protracted treaty negotiations has enhanced the business environment for Australian economic interests in Timor-Leste, including Australian resource interests.

The Government of Timor-Leste has created the Strategic Development Plan 2011-2030 which has set an aspiration for Timor-Leste to become an upper-middle income country by 2030. This is to be realised through several economic levers, including opening to foreign investment and economic diversification and tax reform incentives for private industry. ²

Click here to view the full announcement


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Gulf Strengthens High-Grade Manganese Ore Supply Chain 

ASX Announcement 4 July 2019 

  • First high-grade manganese mine acquired via Gulf’s key Indonesian and Singaporean partners 
  • Gulf’s in-country team continues to build acquisition pipeline with several high-grade mines currently under assessment 
  • Twenty two manganese mines have submitted work plan and budget applications (RKAB) to the Ministry of Energy and Mineral Resources NTT (ESDM) – with thirteen approved and nine in progress. Approved applications are now waiting for final Provisional Government approval 
  • Discussions continuing with offtake and debt financing groups to fund completion of Kupang Smelting Hub construction program

Gulf Manganese Corporation Limited (ASX: GMC) (“Gulf” or “the Company”) is pleased to provide the following update in respect to the strengthening of its manganese ore supply chain and on the progress being made by its Indonesian subsidiary PT Gulf Mangan Grup (“GMG”) with respect to its Direct Shipping Ore (“DSO”) operations in Indonesia.

Acquisition of High-Grade Timorese Manganese Mine 

In line with the Company’s broader project acquisition strategy, Gulf is pleased to report that it successfully vended the Putra Indonesia Jaya “PIJ” high-grade manganese mine in Timor to its key Indonesian and Singaporean partners.

Importantly, 100% of the ore produced will be supplied to Gulf’s operations in Kupang. It is expected that ore supply from PIJ will commence in September 2019 and will steadily increase to about 2,000 tonnes per month by Q1 CY2020. As part of this process led by Steven Pragnell, Gulf’s in-country President Director, several other high-grade manganese mines are being assessed in Timor and surrounding regions with due diligence well advanced on several opportunities.

Figures 1 & 2: Photos from recently acquired PIJ mine pit 

DSO Update 

As previously advised, the Company has received its DSO License to export up to 103,162 tonnes of highgrade (+49%) manganese ore per year. Final preparations are currently being made to commence initial ore supply from Sumbawa, with first ore expected to be loaded in containers and transported to Kupang for processing before the end of this quarter. 

With regard to sourcing additional ore, some twenty two mines have responded to the granting of our DSO export permit by completing their RKAB applications to the NTT Ministry of Energy and Mineral Resources (ESDM) to recommence mining operations. These mines were forced to close down under Indonesian government’s beneficiation policy in 2013, which banned the export of untreated ores. Gulf expects to see the productivity of these mines build incrementally over the coming months as production is gradually ramped-up, along with the utilisation of key logistical and warehousing infrastructure.

Of these twenty two applications, thirteen have been approved by EDSM with a further nine in process. Approved RKAB applications are now waiting for final approval from the Provisional Government. 

Following an initial shipment of about 100 tonnes to test the logistics route from the mine to market, GMG expects monthly exports to commence at 1,000 tonnes per month and ramp up to 10,000 tonnes per month by Q1 CY2020. This ramp-up in operations will be supported by supply of additional ore from the PIJ mine which is anticipated to come online in September. 

Corporate Update 

The Company is also continuing positive discussions with several potential offtake partners and debt providers to secure the requisite capital to fully-fund the completion of the Kupang Smelting Hub Facility construction program. Following recent discussions, it is anticipated that construction activity will recommence this quarter, with commissioning of the first two smelters set for Q1 CY2020.

Management Commentary 

Gulf Managing Director, Hamish Bohannan, commented, “Over recent months our team has worked tirelessly to underpin our ore supply chain and we are delighted to see this work coming to fruition with the successful acquisition through our business partners of our first high-grade manganese mine in Timor. 

“The bolstering of our supply chain has been a key focus as we push towards commercial start-up of our DSO processing operations, with first ore from Sumbawa expected to be transported to Kupang for processing later this month and the first DSO shipment scheduled for this quarter. We are busy sourcing additional suppliers of high-grade ore and we are pleased to see applications submitted by an additional thirteen mines – all of which have potential to feed into our supply chain once approved.

“I look forward to providing further updates shortly on DSO logistics and commercial start-up along with a comprehensive update on the Company and key manganese market dynamics in the near-term.”

ASX Announcement 4 July 2019 


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