Tivan Ltd
Tivan Secures Binding Joint Venture Term Sheets with Timor-Leste State Mining Company, Eyes Maiden Drilling in Q4 2026
Tivan Limited (ASX: TVN) has taken a significant step forward in its Timor-Leste strategy, signing Binding Term Sheets with state-owned mining company Murak Rai Timor E.P. for incorporated joint ventures over the Baucau and Ossu Projects. The Tivan joint venture with Murak Rai for the Baucau and Ossu projects in Timor-Leste formalises the commercial and corporate framework across 289km² of exploration ground considered highly prospective for copper, gold, cobalt, and other critical minerals — and sets the stage for a maiden drilling programme at Ossu targeted for Q4 2026.
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A Landmark Agreement in a Highly Prospective, Underexplored Region
The Baucau and Ossu Projects sit 123km east of Dili, Timor-Leste's capital, within a geological belt hosting some of the most significant copper-gold deposits on Earth. The region shares a geological setting with world-class systems including Grasberg (Indonesia), Ok Tedi, Wafi-Golpu, and Panguna — all located within the same tectonic arc.
Despite this prospectivity, Timor-Leste remains remarkably underexplored. Tivan is among the first movers in what the company describes as one of the most prospective regions globally for undiscovered copper-gold deposits. This position is reinforced by its combined ~633km² tenure across the Baucau, Ossu, and Turiscai Projects.
The signing of Binding Term Sheets with Murak Rai — itself established in 2023 with a mandate to catalyse economic growth through mining — marks a genuine turning point. Moving beyond non-binding arrangements, these agreements set clear timelines, governance structures, and equity terms for formalising the partnership.
Executive Chairman Grant Wilson commented: "Tivan is pleased and proud to have finalised binding agreements with Murak Rai, a key step toward full form joint venture for the Baucau and Ossu Projects. Our material progress reflects the trust we have established with the Government of Timor-Leste over the past 18 months, along with the strong support we have received from community and veterans groups in the project areas."
What the Binding Term Sheets Actually Say
The Binding Term Sheets (BTS) have been executed for each project separately, with identical drafting across both. The structure involves the incorporation of a special purpose joint venture company (JVCo) in Timor-Leste for each project to hold the respective exploration licences.
Key terms at a glance:
| Parameter | Detail |
|---|---|
| Tivan's initial equity (each JVCo) | 80% |
| Murak Rai's initial equity (each JVCo) | 20% |
| JVCo incorporation target date | 31 July 2026 |
| JV Agreement execution target date | 30 September 2026 |
| Exclusivity period | 90 days from BTS execution |
| Murak Rai carry terms | Free carried to completion of DFS or equivalent |
| Murak Rai post-DFS election options | (i) retain 20% pro rata; (ii) convert to 4% NSR; (iii) retain 10% + convert 10% to 2% NSR |
| Regulatory confirmation required | ANM approval for JVCo incorporation and licence transfer |
Tivan will hold its interests through wholly-owned special purpose vehicles: Ossu Holding SPV Pty Ltd and Baucau Holding SPV Pty Ltd. Licences are currently held in Aitutu Pty Ltd (100% Tivan) pending the restructuring required for JVCo establishment.
The free-carry arrangement for Murak Rai is a standard and pragmatic structure for state-owned partner participation in early-stage exploration. It ensures Tivan carries all exploration costs to a meaningful decision point, whilst Murak Rai retains meaningful optionality at a commercially defined milestone.
Understanding the "Free-Carry" and Net Smelter Royalty Structure
What Is a Free-Carry Arrangement?
In a free-carry arrangement, one party — in this case, Murak Rai — holds an equity interest in a joint venture without being required to contribute funding during exploration and development phases up to a defined milestone. Here, that milestone is the completion of a Definitive Feasibility Study (DFS) or equivalent commercial discovery assessment.
Why Does This Matter to Investors?
- Tivan bears 100% of exploration costs to DFS, but retains 80% of each JVCo throughout this period
- It aligns with Timor-Leste's Mining Code requirements for state participation and is common in frontier mining jurisdictions
- Post-DFS, Murak Rai's election options introduce flexibility — conversion to a Net Smelter Royalty (NSR) would reduce Murak Rai's equity stake in exchange for a royalty on production, which can be a favourable outcome for Tivan's per-share economics
Key Terms Explained:
- JVCo: Joint Venture Company — a separately incorporated entity formed to hold and operate specific project assets
- DFS: A detailed technical and economic study assessing the viability of bringing a mineral deposit into production
- NSR: A royalty calculated as a percentage of revenue received from metal sales after smelting and refining deductions
- ANM: Timor-Leste's national mineral resources regulator
- BTS: Binding Term Sheet — a legally binding document outlining agreed commercial terms, preceding a full-form agreement
The Ossu Project: High-Grade Results and a Clear Path to the Drill Bit
The Ossu Project has rapidly emerged as the most advanced near-term catalyst in Tivan's Timor-Leste portfolio. Rock chip samples collected by Tivan's geology team returned standout results that validate the project's high-grade potential.
Tivan's rock chip results at Ossu:
- Up to 17.4% Cu (copper)
- Up to 38.1 g/t Au (gold)
- Up to 0.45% Co (cobalt)
These results are consistent with — and furthermore reinforce — historical work by previous project owner Beacon Minerals, which returned assay results from 38 samples of up to 14.6% Cu, 10.1 g/t Au, and 0.94% Co.
Assay Comparison — Historical vs. Tivan Sampling:
| Source | Max Cu | Max Au | Max Co |
|---|---|---|---|
| Beacon Minerals (historical) | 14.6% | 10.1 g/t | 0.94% |
| Tivan (2026 rock chips) | 17.4% | 38.1 g/t | 0.45% |
Building on these surface results, Tivan has engaged Southern Geoscience Consultants (SGC) to undertake reprocessing and interpretation of historical regional magnetic and radiometric datasets across all three projects. The objective is to refine structural and lithological interpretations and fast-track target generation.
The maiden drilling programme at Ossu, targeted for Q4 2026, will initially focus on priority targets defined through integration of historical exploration data, recent surface sampling, geological mapping, and reprocessed geophysical results from SGC.
Operational Conditions Favour a Rapid Drilling Start
One factor that stands out in Tivan's Ossu narrative is the favourable operational environment. Unlike many frontier exploration settings requiring expensive heliportable or manportable drilling equipment, the Ossu Project benefits considerably from:
- Accessible terrain with comparatively moderate topography
- Established road networks and river crossings providing year-round access
- Ability to mobilise conventional drill rigs and support vehicles efficiently
- Ground-based geophysical survey capability — often impractical in more remote settings
This operational profile translates directly to lower mobilisation costs and a more predictable drilling timeline — a material advantage for a company targeting a maiden programme within calendar 2026.
Milestones and Timelines: What to Watch
The next six months represent a dense period of value-creating activity. Investors should monitor the following sequence of catalysts:
| Target Date | Milestone |
|---|---|
| May–June 2026 | SGC geophysical reprocessing across Baucau, Ossu, and Turiscai |
| Ongoing (near-term) | Murak Rai geologists contribute to Speewah fieldworks |
| 31 July 2026 | Target incorporation of JVCo entities in Timor-Leste |
| 30 September 2026 | Target execution of full-form JV Agreements |
| Q4 2026 | Maiden drilling programme at Ossu Project |
The regulatory pathway to drilling is described as well understood, principally involving expansion of existing Environmental Management Plans to incorporate ground-disturbing activities, alongside work programme approval and stakeholder engagement under the Mining Code.
A Relationship-Led Strategy Bearing Structural Results
What distinguishes Tivan's position in Timor-Leste is not simply the geology — it is the depth of institutional and community relationships the company has built over the past 18 months. The progression from initial engagement to signed Binding Term Sheets with a state-owned enterprise reflects a deliberate approach to trust-building in a nascent mining jurisdiction.
Indicators of this relationship depth include:
- Attendance at community licence presentation ceremonies in April 2026, including by newly appointed Technical Advisory Group member Major Michael Stone (Retd)
- Murak Rai geologists actively participating in Tivan's Speewah Fluorite Project fieldworks in Western Australia — a cross-border capability building initiative
- Tivan's alignment with the principles of the Parseria Foun Ba Era Foun — the Joint Declaration between the Governments of Timor-Leste and Australia (2026)
Murak Rai President and CEO José Manuel Gonçalves stated: "The finalisation of the binding agreement with Tivan underscores Murak Rai's commitment to accelerating mineral exploration in Timor-Leste, specifically within the Baucau and Ossu project areas. Leveraging our local resources and strategic capabilities, we are fully prepared to support Tivan in the upcoming maiden drilling campaigns scheduled for later this year."
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Why Investors Should Be Watching Tivan
Tivan's Timor-Leste portfolio is advancing on multiple fronts simultaneously — binding commercial agreements, geophysical interpretation, regulatory engagement, and imminent drilling. Several factors combine to make this an investment case worth tracking closely:
- First-mover advantage in one of the world's least explored yet geologically analogous copper-gold belts
- 80% controlling interest in both JVCos entering formal arrangements with a supportive state partner
- High-grade surface results at Ossu (up to 17.4% Cu, 38.1 g/t Au) that validate the exploration thesis ahead of drilling
- Near-term binary catalyst — maiden drilling at Ossu in Q4 2026 represents a clear, time-bound inflection point
- Combined ~633km² of tenure across three projects analogous to Grasberg, Ok Tedi, and Wafi-Golpu
The Tivan joint venture with Murak Rai for the Baucau and Ossu projects in Timor-Leste now moves toward operational implementation, with maiden drilling representing the next major value inflection point. The progression from preliminary engagement to binding commercial terms demonstrates substantial de-risking of the regulatory and partnership elements of Tivan's broader strategy.
Key Takeaway: Tivan has positioned itself as a genuine first mover in Timor-Leste's emerging mineral resources sector, with binding joint venture agreements in place with the state mining partner, high-grade copper-gold results already in hand, and a maiden drilling programme at the Ossu Project on the horizon for Q4 2026. With JVCo incorporation targeted for July and full-form agreements for September, the next several months represent a significant de-risking and value-creation sequence that warrants close investor attention.
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