Altura updates Indonesian coal project
Monday, January 31 2011 - 07:21 AM WIB
TABALONG (South Kalimantan) Thermal Coal (100% AJM)
The Tabalong Coal Project consists of two (2) Mining Licences (IUPs) in the province of South Kalimantan on the island of Borneo. Currently both IUPs are granted for exploration purposes and Altura is seeking the necessary approvals to have them granted for operation production status.
Altura is awaiting grant of the two (2) Mining Licences in accordance with the current legislation. The pre-requisite documentation required for grant consisting of the Environmental Impact Statement and the Government Feasibility Study has been submitted to both Regency Councillor and Mines Department. The documents have been approved in principle and now await formal submission to support operational approval, however there is no definitive timeframe for these approvals. Subsequent to operational approval the Company will be required to gain clearance from the Minister of Forestry prior to commencement however the project does not cover any protected forest areas.
During the quarter further assessment and planning for product coal transport and route approval has continued in preparation for coal production. Currently two (2) options remain with the first entailing approximately 120km haul to an offload point in the Barito River, whilst the second entails an approximately 25km haul to a discharge point to another mining entity.
The current cost of production estimate (FOB barge) is US$60 per tonne for the 120km haul option however a reduction of US$13 per tonne is forecast if the shorter route is chosen. Thermal coal prices have firmed in Indonesia during the quarter with price yields greater than US$90 per tonne for Tabalong grade coal being achieved.
The Company aims to develop Tabalong as a stand-alone operation initially at a planned annual production rate of 300,000 to 400,000 tonnes per annum of premium thermal grade coal. The location of the Tabalong project also lends itself to satellite development of other mining permits. The area consists of numerous other smaller resource areas that have the potential to be operated simultaneously to provide increased tonnages and blended coal products. Altura is considering a number of potential adjacent projects that could be amalgamated into the development.
COAL ? Indonesia
During the quarter, Altura continued to source and review a number of other potential coal acquisitions in Indonesia. Following an extensive review, a short list of potential targets was compiled and discussions are continuing with a number of parties. The Company will inform shareholders and the market if an agreement can be reached and remains confident that a suitable coal project can be delivered in 2011.
About Thermal Coal
Thermal coal forms the backbone of worldwide energy supplies with Indonesia now the world?s largest exporter of thermal coal products. Recent innovations in coal beneficiation and clean coal technology point toward a strong future for coal to remain a reliable energy generation commodity.
The Indonesian mining services division has produced revenues of US$4.1 million for the first half of the financial year and remain on target for annual revenue of between US$8 to US$9 million.
PT Asiadrill Bara Utama (100% AJM)
The mining service group of Asiadrill Bara Utama (Asiadrill) and Velseis Indonesia (Velsei-50% Altura) continued exploration support services during the quarter. The drilling operations were confined to Indonesia with a primary focus in coal exploration and development.
Drill rig deployment further increased during the quarter via new contract awarding and expansion of drill units existing contracts. Asiadrill operated up to twenty (20) individual drill units consisting of track and skid mounted and man portable units during the quarter.
Asiadrill has equipment deployed in South and East Kalimantan on the island of Borneo with offices in Jakarta (West Java), Balikpapan (East Kalimantan) and Tanjung (South Kalimantan).
About PT Asiadril Bara Utama
Asiadrill operates a varied fleet of truck and track mounted drills; supplemented by a fleet of hell-lift and man-portable units for environmentally sensitive areas. The current fleet totals sixteen (16) larger units and fifteen (15) man-portable drills. Asiadrill?s predominantly Indonesian workforce totals 48 permanent and up to 150 contract staff.
PT Velseis Indonesia (50% AJM)
Velseis Indonesia (Veleis - 50% Altura) operated up to eight (8) wireline units during the quarter out of a total fleet of eleven (11) tinits. Velseis has operated primarily in East and South Kalimantan provinces on the island of Borneo. Velseis continues to partner Asiadrill on a number of projects to provide clients with both drilling and geophysical services on their coal exploration projects.
About PT Velseis Indonesia
Velseis Indonesia is joint venture company between Altura and Velseis Pty Ltd (Brisbane based wireline and seismic service provider). Velseis operates a fleet of eleven (11) portable and vehicle mounted wireline logging units in Indonesia. The Velseis Indonesian workforce totals 24 permanent staff.(end of edited excerpt)