Churchill Mining accelerates drilling at E. Kalimantan coal project

UK miner Churchill Mining Plc announced Tuesday that recent geological field results at the Sendawar thermal coal project in East Kalimantan had been encouraging and the company had commissioned a second drill rig to accelerate the exploration programme.

The Company expected its drilling contractor, PT Maxidrill Indonesia, to complete building the rig at its Jakarta workshop within two weeks, ready for field commissioning at the end of the month.

Churchill already has a drill rig at site which has completed four stratagraphic holes necessary to aid in the geological understanding of the Sendawar project before the drilling of actual coal targets begins. This rig has now been relocated and Churchill?s geologists have begun the drilling of specific coal outcrop areas.

Shortly, Churchill?s geological advisors shall decide whether the newly commissioned drill rig will be deployed either to expand drilling on the current coal outcrop targets or be moved to drill in the north of the Sendawar project.

"Whilst Churchill?s ultimate project target is an eventual JORC-compliant resource of 200 million tonnes, the first resource milestone is a target of five million tonnes. At this threshold, the company believes it should be in a position to begin trial mining. Any profits from this operation will be re-circulated back to the project by way of an expanded exploration programme," the company said.

Churchill Mining?s Sendawar project in Kalimantan covers more than 1,000 square kilometres of prospective ground. The Sendawar project is located approximately 50km from the Mahakam River.

In June 2006 Churchill announced the first test results, albeit early stage and limited, from outcrop samples gathered at Sendawar; these confirmed the presence of high calorific coal, i.e a calorific value above 6,300 Kcal/kg.(alex)