Cokal seeks to upgrade BBM mining license

By Peni Pedriawan

ASX-listed Cokal Limited said it has lodged application to upgrade the exploration license to a full operation / production mining license for its 60 percent owned Bumi Barito Mineral Coal Project (BBM), located in Central Kalimantan, Indonesia.

The application was prepared in accordance with the relevant mining regulations and was submitted to the Ministry of Energy and Mineral Resources on January 16, 2013, the company said in a statement received Thursday.

Once granted, the upgraded mining License provides a key part of the necessary approval pathway to commence the development and operation of the mine.

?With the lodgment of the mining license upgrade application, together with the submission of the EIS (environmental impact study; ASX Announcement - January 14, 2013), the approvals process remains on track to allow construction to commence in fourth quarter of 2013. With the achievement of these two significant milestones we remain excited about the progress we have so far made towards bringing this low cost, high value project into production? said Managing Director Jim Middleton in the statement.

Project overview
The BBM coal project is situated in Central Kalimantan, Indonesia in the prospective metallurgical Upper Barito Coal Basin, Regency of Murung Raya. The project covers an area of 19,920 hectares. The Project is adjacent to the BHPBilliton?s, Indomet Coal. Joloi Project in Murung Raya Regency.

BBM has reported an Exploration Target1 of 200 to 350 Million tons (Mt) in thirteen seams within the Eastern Block of the BBM mining license (approximately 40 percent of the project area), as well as an additional JORC Resource of 77Mt in four seams comprised of 70Mt Inferred and 7Mt Indicated. The BBM project is proposed to produce up to 6.5 Million tons per annum (Mtpa) Run of Mine (ROM) estimated to provide 5.6Mtpa saleable product, with first coal scheduled in 1H 2014.

Cokal Executive Chairman, Peter Lynch, said ?The Pie-feasibility Study (PFS) provided us with significant confidence that we have a technically viable and economically compelling project, in a commodity with a great future. We are now focused on completing all the necessary applications, approvals, project studies and contracting arrangements required to take the project into production.?

The BBM Project is geographically strategically located to supply metallurgical coal, with excellent product properties, to customers in the Asian sub-continent. It enables Cokal to enhance the supply diversification from this emerging coking coal basin in Central Kalimantan. These features for our flagship BBM Project add up to great value for our potential customers and a real opportunity for our shareholders.

Editing by Reiner Simanjuntak