Churchill Mining begins drilling primary target at E. Kalimantan coal project

UK miner Churchill MIning PLC announced Tuesday that it has now begun drilling on the primary coal resource targets in the northern portion of the Sendawar project, East Kalimantan and plans to drill 64 new holes by February 2007.

The programme, which will concentrate on the top end of the tenements, is designed to test possible seam extensions from the abutting Gunung Bayan mine onto the Sendawar ground, the company said.

The programme is part of a 23,000 metre drilling plan Churchill is conducting on the 1000 square kilometre Sendawar project. The company is currently sourcing another three rigs to further accelerate drilling in 2007.

"Whilst Churchill?s ultimate project target is an eventual JORC-compliant resource of 200 million tones, the first resource milestone is a target of five million tones. At this threshold, the Company believes it may be in 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 and lies in close proximity to two operating open-cut mines: Thai miner Banpu?s newly commissioned Trubaindo operation, which will be shortly producing at a rate of approximately 6 million tonnes per annum (tpa); and the privately-owned Gunung Bayan mine which has been operating since 1998 and produces approximately 3.4 million tpa.

Coal from these mines is transported via barge via the Mahakam River to the port of Samarinda. The Sendawar project is located approximately 50km from the Mahakam River. (alex)