Indonesian miner PT Merdeka Copper Gold Tbk [IDX:MDKA] has mandated UBS to explore strategic options for its 99%-owned Tujuh Bukit Project (TBP), a copper-gold mining project in the Indonesian province of East Java, said three sources familiar with the situation.

The parent company has been weighing options such raising capital at Merdeka’s level, the second source said. Another option is to bring in strategic or financial investors via a stake sale in PT Bumi Suksesindo, the corporate name of TBP, the first and second sources said.

As of 31 December 2023, TBP’s assets stood at USD 600.5m, as disclosed.

Merdeka did not respond to a request for comment. UBS declined to comment.

TBP, which has gold-silver and copper-gold deposits, is located 60 kilometres southwest of the regional centre of Banyuwangi in Java. The company holds a mining business license (IUP) for the operation and production for an initial 20 years and extendable by way of two distinct 10-year options, as disclosed.

This potential deal comes after the company announced in May 2024 its plan to offer 2.45bn shares via private placement. Proceeds were earmarked for working capital and business development, including capital expenditure and the purchase of shares or assets in one or more companies within related industries or related to the company’s business activity.

The company’s shares are trading 7.52% higher or IDR 1,715 apiece YTD.

Apart from TBP, Merdeka manages the Water Copper Mine in the northern coast of Wetar Island in East Nusa Tenggara; the MBMA Group, which focuses on nickel production; and the Pani Gold Project in Gorontalo Province, North Sulawesi.