Coal Fe says E. Kalimantan mine to start production August 2009

Australian firm Coal FE Resources said Tuesday that it would commence coal production from its Abadi coal concession in Kutai Kartanegara regency, East Kalimantan by August 2009.

The company said its subsidiary PT Techventure Indocoal will jointly manage and administer the mining activities of the Abadi Project with PT Toba Jaya, a subsidiary of Malaysian company, Kok Ann Construction Works (M) Sdn Bhd.

Under the Joint Mining Management Agreement, Toba Jaya will finance the capital expenditure, machineries and all necessary costs to commence mining operations by August 2009.

In return Indocoal undertakes to obtain all relevant licenses needed for mining and selling the coal from the Abadi project. Indocoal will also ensure compliance on all reporting and licensing responsibilities to the local Government and Mining Department.

Under the JMMA, Indocoal will receive a maximum of up to USD3 per tonne upon production and sale of the coal. The mining schedule is designed to accommodate a coal production of up to 900,000 tonnes per annum as per the approved Feasibility Study and Environmental Impact Study by the Mining Department and Regent of Kutai Kartanegara respectively.

The Exploitation Licence has been issued for the Abadi Project encompassing an area of 991 hectares for a period of 16 years expiring on 18 December 2024. (denny)