Australia's Straits sees higher earnings on Sebuku coal prices

Australian mining firm Straits Resources Limited said Thursday its earnings from coal business will significantly increased this year as the pricing of Sebuku coal in the second half of 2005 will extremely higher than the first half.

?We achieved approximately US$37 per ton in the first half (of 2005), while in the second half we?re expecting US$47 a ton,? Straits? CEO Milan Jerkovic said in an interview with corporatefile.com.au.

Straits operates the opencut truck and shovel Sebuku coalmine in South Kalimantan through its wholly-owned subsidiary PT Bahari Cakrawala Sebuku.

Straits recently reported Sebuku produced a record 697,000 tons of coal for the quarter ending June 30, 2005. The company expects to produce 3 million tons for this year, higher from 2.55 million tons in 2004.

?In terms of production for the year, while obviously the first half is a little bit behind in terms of its target, it is on track if you look at our record over the last three years. We are always somewhat behind in the first half due to the wet season and general ramp up in the second half of the year,? Jerkovic said.

Jerkovic also said drill holes, which were recently completed at Tanah Putih, showed a new coal seam of 7-8 metres average thickness below and adjacent to the previously planned pit which could be extensive.

A full drill-out to test these areas will take 12 to 18 months during which time we will be reevaluating the life of mine at Sebuku, Jerkovic said, adding that the outcome of that review will guide any further expansion plans.

According to Jerkovic, current infrastructure at Sebuku is capable of processing at least 4 million tons annually through the washplant. The port facility has up to 5 million tons of shipping capacity. (robert)