BCI Minerals has entered a non-binding Memorandum of Understanding (MOU) with PT Mineral Industri Indonesia (Persero) (MIND ID) in relation to a potential offtake of up to 1 million tonnes per annum (Mtpa) solar salt produced from the Mardie Salt and Potash Project and a potential equity investment in BCI of up to A$100 million by MIND ID.
The Mardie Project has been under construction since February 2022, and upon completion will result in a Tier 1 solar evaporation project that will be a sustainable supplier of salt and potash to the growing chemical and agricultural industries for generations. It is forecast to produce approximately 5 million tonnes of salt and 140 thousand tonnes of SOP every year for 60 years, making it the largest salt project in Australia and the third largest solar salt project in the world.
Commenting on the MOU, BCI Managing Director, David Boshoff said: “BCI looks forward to partnering with MIND ID for the potential sale of a substantial proportion of our premium solar salt product into Indonesia and potential equity investment in BCI.
“The MOU aligns with our strategic positioning and commercial strategy at a time of emerging opportunities in global markets for the supply of high-quality salt products,” said Mr Boshoff.
MIND ID is owned by the Indonesian Government and acts as the holding company for the Indonesian government’s investment in the mining industry in Indonesia.
The MOU contemplates a potential offtake agreement with an initial term of 5 years from supply commencement, which is currently anticipated to be in or around July 2026, with the option to extend the term for a further 5-year period.
BCI has been progressing discussions with several interested offtake partners, reflecting the strong market growth for salt and sulphate of potash.
This announcement comes only a week after the execution of a Term Sheet with Japan’s largest trading and investment companies, Itochu Corporation, for the sale of salt from BCI’s Mardie Project.
Both agreements indicate significant endorsement in the Mardie Project and supports BCI’s vision of becoming a globally significant minerals business.
The MOU also contemplates a potential equity investment in BCI by MIND ID of up to A$100 million. The potential equity investment by MIND ID is envisaged to be undertaken in connection with the equity raising contemplated in the Company’s presentation entitled ‘Update of the Mardie Salt and Potash Project and Base Case’ dated 20 June 2023. This is subject to both parties negotiating the terms of any formal binding documentation necessary to facilitate the potential investment in good faith. It is intended that the Proposed Investment shall result in MIND ID acquiring no more than 9.99% of the voting securities in BCI.
“BCI is extremely pleased to receive MIND ID’s expression of interest in making a material equity investment in BCI and looks forward to welcoming MIND ID as a key shareholder of BCI on the expected successful completion of these negotiations,” said Mr Boshoff.
The MOU provides a framework for further good faith negotiations with a view to entering into the formal binding documentation of the potential offtake and equity investment. Any such binding documentation is
expected to contain terms and conditions usual for these types of agreements, including any required approvals.
Commenting on the MOU, MIND ID’s President Director, Mr Hendi Prio Santoso, said: “MIND ID is happy to have signed an MOU with BCI Minerals. With Indonesian demand for industrial-grade salt on the rise, this cooperation will help fill in the expected supply gap especially from increased downstream activities of various mineral smelting and refining activities in the nation. This MOU not only signifies the strengthening of the relationship between Indonesia and Australia, but also reflects MIND ID’s continuous commitment to ESG by taking participation in the Mardie solar-salt project and to its global strategic plan to become a world class company. MIND ID is looking forward to working together with the BCI Minerals team and begin what we hope to be a long-term partnership”.
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FOR MORE INFORMATION:
Rika Potter
BCI Minerals – Communications and Engagement Advisor
T: +61 424 328 223
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ABOUT BCI MINERALS
BCI Minerals Limited (ASX:BCI) is an Australian-based company, focused on rapidly advancing its 100% owned Mardie Salt and Potash Project.
The project is on track to become the first new solar salt operation in Western Australia in over 25 years and the first to produce salt and sulphate of potash from seawater.
Mardie aims to produce approximately 5 million tonnes of high-purity salt and 140 thousand tonnes of sulphate of potash fertiliser per annum. Using an inexhaustible seawater resource and 99% of the energy required produced by natural solar and wind energy Mardie is a multi-generational sustainable opportunity supplying salt and potash growth markets over many decades.
BCI acknowledges the Traditional Custodians of country throughout Australia and pays respect to the Whadjuk people of the Noongar nation as the Perth Traditional Owners, the Mardie Traditional Owners the Yaburara and Mardudhunera people and also the Robe River Kuruma people and the Iron Valley Traditional Owners the Nyiyaparli people and their connections to land, sea and community. We pay our respects to Elders past, present and emerging and extend that respect to all Aboriginal and Torres Strait Islander peoples.