Sale of Cibaliung Gold project completed

Arch Exploration Limited (ARX) has completed the sale of Cibaliung gold project in Indonesia to PT Aneka Tambang (ANTM) Tbk. 

ARX, listed in Australia, told ASX today that it has also fully redeemed the outstanding $2,000,000 January 2010 Convertible Notes by effecting a cash payment of $221,117 and issuing 17,775,000 July 2012 Options exercisable at 2.5 cents to the Convertible Note holders.

The sale relieves ARX of its obligation to fund Cibaliung and to service the associated project debt obligations to the ANZ Bank. Additionally, the Company’s guarantee in respect of the project debt and associated security over the remaining assets of ARX have also been released, leaving ARX in a position to pursue its exploration objectives in Indonesia.

ANTM, ARX, and ANZ Bank signed a binding heads of agreement in February 2009 where ANTM agreed to acquire ARX's interest in PT Cibaliung Sumberdaya (CSD) for US$1 and ANZ Bank's interest in the project. Prior to the acquisition, ARX is the majority shareholder of CSD with 95% ownership and Antam holds the remaining 5%.

Cibaliung gold project has a mine life of six years with annual ore production of 220,000 tons and production of gold equivalent of around 70,00 oz, and estimated gold reserves of around 412,000 oz.

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