Bank appointed financial advisor for Tabang coal upgrading plant expansion

White Energy Company Limited and PT Bayan Resources Tbk. on Wednesday announced the appointment of Standard Chartered Bank as financial adviser to their coal upgrading joint venture company PT Kaltim Supacoal (KSC), for the establishment of a project financing facility to assist with the next phase of the expansion of KSC?s Tabang project to 5 million tonnes in annual capacity.

Based on current information and proposed expansion plans, the final amount available under the facility is expected to be a minimum of US$150 million, the companies said in a release.

The facility is conditional upon the successful completion of project due diligence by Standard Chartered Bank, including the satisfactory operation of the initial 1 MTPA plant at Tabang, which is now in its final stages of commissioning having recently produced its first batch of upgraded coal briquettes.

Financial close for the facility is being targeted for the end of the first quarter 2010 which is also expected to coincide with the finalization of the Engineering, Procurement and Construction (EPC) contractor arrangements.

Standard Chartered Bank has also agreed to provide KSC with an immediate interim US$10 million Working Capital Facility to assist with its operating and production ramp-up expenses.

White Energy and Bayan have agreed to expand the capacity of their existing joint venture in Tabang, East Kalimantan, to 15 MTPA in ultimate production capacity. The next stage of this project is envisaged to comprise the construction of an additional 4 production modules adjacent to the current facility, to take the production capacity to 5 MTPA by 2011. (denny)