Under the terms of a memorandum of agreement (MoA) signed in 2021, Nickel Industries purchased the majority interest through a milestone payment of 4 million of its company shares, following a 24-month exploration at Siduarsi.

The acquisition was contingent on an initial mineral resource at the project of more than 50 million dry metric tonnes (dmt) at 1.1% nickel. Nickel Industries announced an initial mineral resource of 52 million dmt of 1.1% nickel and 0.1% cobalt, equivalent to 561,000 tonnes of contained nickel metal and 31,000 tonnes of cobalt.

The MoA also gives Nickel Industries the option to increase its stake in Sudarsi to 82.5% upon completion of a feasibility study that is accepted by the Indonesian mining department.

Nickel Industries confirmed that it has submitted the feasibility study, proposing a 3 million wet metric tonnes direct shipping operation at Siduarsi. Upon acceptance of the feasibility study, the company said the contract of work (CoW) will move to a 30-year mining operation license.

Nickel Industries can eventually increase its interest to 100% ownership in the project, following a third-party valuation on the Siduarsi resource.

Nickel Industries shares lowered 0.9% to 84 cents at market open on the ASX.

The context: The Siduarsi project is a CoW held by PT Iriana Mutiara Mining and is one of four active nickel CoWs in Indonesia.