Mt Kare mine developer denies liquidation

Above: Royal Papua New Guinea Constabulary parade at Mt Kare. Photo: Nigel Nawara

Above: Royal Papua New Guinea Constabulary parade at Mt Kare. Photo: Nigel Nawara

Leo Wafiwa | PNG Loop

The directors of Summit Development Limited (SDL), the developer of Mt Kare gold project have advised all stakeholders that the company is not in liquidation as per “some rumours’’.

Director of Summit Development Limited, George Niumataiwalu, today said the parent company of SDL, Indochine Mining Limited (IDC) was placed into voluntary administration by the directors of IDC. Therefore the company appointed Darren Weaver, Ben Johnson and Martin Jones as Joint and Several Administrators pursuant to section 436A of the Corporations Act 2001.

“It is important to note that this appointment only relates to IDC and not its subsidiaries.

“Voluntary administration (in the Australian context) is a procedure where the directors appoint an external administration whose role is to work with the directors to develop and implement a financial re-organisation solution for the benefit of all stakeholders,” the Fijian director said.

He explained that the ultimate aim of a voluntary administration is to achieve an outcome that results in a better return to stakeholders than would otherwise have been achieved in a winding up.

“The appointment of voluntary administrators does not necessarily mean that the company is going into liquidation. The board and management of IDC have been, and will continue, in conjunction with the administrators, to seek to secure the necessary funding to provide for the long term, viability of Mt Kare.

“IDC remains committed to turning Mt Kare into a profitable, long life operation.”

Mr Niumataiwalu said that the decision to place the company into voluntary administration did not enforce any action upon Summit, a PNG subsidiary of IDC and they would, for the most part, continue business as usual except that the administrators would direct the affairs of the parent company.

Mr Niumataiwalu added that as to the Mt Kare project, the administrators had been in contact with the Mineral Resources Authority (MRA) in preparing for a restructure of the project, to maximise returns to all creditors and preserve its future value for landowners and creditors alike.

Indochine was placed into a voluntary administration in late March this year after it failed to secure sufficient funding for its Mt Kare project. The funding failure arose when unnamed interested parties to the project withdrew their funding offers.

It was reported earlier that Indochine had cash of A$413, 000 (about K900,000) at the end of December 2015 and had raised $500, 000 (K 1.4 million) in February. However, the company also has a $3.75 million (K10 million) loan which is due at the end of next month.

In an attempt to build sufficient funds, the company had aggressively cut costs, going from a burn rate of more than $1.2 million (K3.3 million) a month in the middle of last year to less than $250, 000 (K680, 000) as reported by MiningNews.com.

5 Comments

Filed under Financial returns, Papua New Guinea

5 responses to “Mt Kare mine developer denies liquidation

  1. concerned123456

    What is the financial status of Summit, these comments are continuing the misleading IDC information that has cost its shareholders millions.The point of the matter is that the Landowners have instructed MRA not to renew EL1093 to IDC – Summit and have refused their entry to the site.
    IDC with its help from Summit have raised tens of millions to achieve basically nothing for Mt Kare Landowners only to enshrine the procrastination again basically nothing regarding to mining the site.
    The new Directors of IDC are masters of spin, experienced administrators. and now with Ferrier Hodgson appointed to the now add to the mass of debt,
    IDC creditors totally out weigh any asset worth.
    This George needs to go back to where he came from as he has worn out his welcome in the Highlands of PNG.

    • The whole problem can be sheeted back to the MRA’s previous Managing Director who really treated the Mt Kare land owners with a great deal of disrespect.

      On the other hand, the former head of Regulatory Operations within the MRA was very respectful of the Mt Kare land owners.

      This ended up in a brawl between the former MD of and the former EM of the ROD.

      The truth, 4 years later its very clear that the former EM was absolutely corrected and the former MD of MRA absolutely wrong.

  2. George is talking absolute rubbish.
    The company is broke, no two ways about it.
    What’s more, the company has been telling BIG FAT LIES the last year t its investors concerning the added resource which is NOT 500,000 oz @ 10 gpt BUT a much more modest 210,000 oz @ 10 gpt.
    There is also now evidence of a massive fraud committed by the former promotors of Indochine, the former directors and shareholders of Summit Development.
    No surprise the company is nearly broke.

  3. concerned123456

    IDC did not submit its half yearly returns to ASX because its Auditors would not sign off on the fraudulent figures supplied by the IDC Board,its as simple as that.
    To add IDC could not honour terms to an investor ( Rodan) $3 million + loan, not excluding financial obligations not met everywhere.

    Any one who believes this rubbish is in dream land.

  4. Ron

    Has anybody got positive news to share?
    Is there going to be a light at the end of
    this tunnel?

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