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ndonesia'€™s largest coal miner PT Bumi Resources (BUMI) announced on Thursday the transfer of its 19 percent stake in coal unit PT Kaltim Prima Coal to China Investment Corporation (CIC), as part of its debt repayment, was complete.

The stake is equal to US$950 million, reducing Bumi'€™s debt to CIC to $1.04 billion.

Bumi president director Ari Hudaya said that he welcomed CIC as his company'€™s equity partner, adding that the transfer was a major step in the restructuring of Bumi'€™s financial performance and the reduction of its debt.

'€œWe are confident our revised capital structure and the recovery of coal prices will enable us to return to profit making,'€ he said in a statement.

Bumi will also transfer equity worth $150 million and a 42 percent stake in another subsidiary '€” non-coal miner PT Bumi Resources Minerals (BRMS), which is valued at $257 million '€” in September.

Bumi is also looking to raise Rp 8 trillion ($671.2 million) in a rights offering in September this year to pay numerous debts.

Among the debts it needs to pay is $150 million owed to the CIC through Country Forest Ltd. (CFL), $150 million owed to Castleford Investment Holdings Ltd., and another $150 million that is part of the $375 million guaranteed convertible bonds.

Meanwhile, BRMS also announced on Thursday that Chinese giant China Nonferrous Metal Industry'€™s Foreign Engineering & Construction (NFC) was interested in developing its copper and gold mine in Gorontalo, Southeast Sulawesi.

BRMS CEO Suseno Kramadibrata on Thursday announced that the Chinese miner had expressed its interest through a letter of intent signed by its vice president Ma Jinping on June 24.

Suseno said that the letter did not elaborate on the specific cooperation as NFC was still reviewing the data on the Gorontalo mine.

'€œTwo months after signing the letter of intent, NFC must submit a more specific cooperation plan in an effort to monetize Gorontalo'€™s copper and gold reserves,'€ he said in a written statement.

The plan will involve ways to raise money for capital expenditure; selecting contractors for the engineering, procurement and construction (EPC); and identifying the offtakers for the final outputs to be produced.

'€œObviously, we will make sure that the final cooperation agreement will be beneficial for both NFC
and BRMS. It must add significant value to our shareholders,'€ Suseno said. '€œOtherwise, we can always pursue opportunities with other parties.'€

NFC is one of the largest mining and construction companies in the non-ferrous metal industry in China, operating a number of copper and zinc-lead mines, open pit and underground mines, at home and in other countries such as Mongolia and Myanmar. The Shenzhen-listed firm also operates a smelting facility with capacity up to 210,000 tons per annum.

BRMS currently owns a 80 percent stake in PT Gorontalo Minerals, which holds the contract of work to mine the 36,070-hectare (ha) copper and gold concession in Gorontalo, Sulawesi. State-run diversified miner Aneka Tambang holds the remainder.

The company is developing 292 million tons ore resources from PT Gorontalo Minerals'€™ Cabang Kiri and Sungai Mak sites with an average content of 0.5 percent copper and 0.47 grams per ton of gold.

The non-coal miner has recently stated that it would shift its core business in Gorontalo from copper to gold, following uncertainties in the construction of a copper smelter to be built by PT Nusantara Smelting.

The development of the copper mine would take a minimum of three years, starting from 2015 at the earliest.

If the smelter cannot be completely established by 2019, Suseno said that it might have to turn the Gorontalo business to gold mining to pocket income, arguing that the investment to operate a gold mine is expected to be lower than copper, also with quicker payback.

While waiting for certainty on the smelter development, the company said that it would look for other partners to provide copper smelting and refining facilities for its Gorontalo mine.