Churchill studies transport options to fast-track E. Kalimantan coal project
Monday, November 10 2008 - 02:21 PM WIB
According to the company, new independent studies have concluded that a combination of road and river barge transport is now possible and should be the most capital cost-effective and quickest initial access method to transport the coal from site for the fast-track production scenario.
The studies concluded that access to the Senyiur River, which is a tributary of the Mahakam River south of the EKCP, can be used to transport the coal down to the Mahakam River for transhipment and onto multi-user coal ports at the coast.
The newly surveyed Senyiur River route could enable shipping of up to 7MTPA of coal, starting with delivery of up to 3 MTPA, which is the increased target for the first full year of production, the company said.
Currently, a new multi-user coal barge port is being built on the Senyiur River by a third party. Churchill management is in discussions with the company constructing this river barge port to gain access to the facility, which would result in a significant reduction in capital expenditure for Churchill.
The company is also in discussions with the owners of current and proposed multi-user coal ports on the coast, which if access is gained, will also add significant further reductions to Churchill?s project capital costs.
The company continues its detailed work on a number of options for the 20MTPA full-Production scenario, to transport the coal to a new dedicated port, including a conveyor system, it said.
Infill drilling continues on site and is on target to upgrade much of the 1.42 billion tones of coal resource to ?mineable? by the end of 2008, it added.
Churchill recently launched a review into coal treatment processes that have the potential to move the energy content of EKCP?s thermal coal from the current range of kcal 4700 ? 5600 ADB (Air Dried Basis) to over kcal 6000.
?Churchill?s examination of processes to upgrade the EKCP thermal coal has determined that the coal sale price assumptions in the Company?s business model could be increased from US$50 per tonne to $84 per tonne (in the current price environment) at an operational cost of US$3 per tonne,? the company said.
?Churchill?s technical team is in the process of finalising their assessment of the available upgrading technologies and it is envisaged that at least one of these plants will be onstream during the first year of full production.?
In May 2007 Churchill announced a sales agreement had been entered into to purchase a 75% interest in the East Kutai Coal Project from PT Techno Coal Utama. Churchill has now extended the size of the project by 200 square kilometres by acquiring a 75% interest in the abutting tenements to the west of EKCP from the Investmine Group of Indonesia. Exploration and resource drilling continue along with scoping and pre-feasibility work.(alex)