Cokal updates C. Kalimantan coal project
Friday, January 30 2015 - 10:09 AM WIB
EXPLORATION
BBM's Production IUP covers an area of 14,980 hectares (ha), immediately adjacent to BHP Billiton?s Juloi tenement, straddling the Barito River and has multiple seams of high quality metallurgical coal.
Highlights
? Completed detailed surface geological mapping of proposed open pits Pit 1 and Pit 2 at BBM East Block.
? Completed detailed geological model evaluation of B, C, and D seam group in proposed open pits Pit 1 and Pit 2.
? Completed detailed geological model evaluation of J seam group in proposed open pits Pit 3 and Pit 4
DETAIL SURFACE MAPPING
During the Quarter further detailed geological survey mapping in and around proposed BBM open pits Pit 1 and Pit 2 was conducted by Cokal?s team of geologists. Analytical results of the outcrop samples have confirmed sufficient quantities of a low ash (2% -7%) coking coal for the initial 2 years of mining as scheduled in BBM?s Definitive Feasibility Study.
Completed detail geological mapping in Pit 1 (with total length of 3,600m) recorded a total of 147 coal outcrops with coal seam thicknesses ranging from 0.12 ?1.98 m. A total of 56 plies from within Pit 1 have been sampled using channel sampling method and subsequently analysed at a local laboratory for basic physical properties.
Completed detail geological mapping in Pit 2 (with total length of 3,900m) recorded a total of 116 coal outcrops with coal seam thicknesses ranging from 0.08 ?1.88m. A total of 34 plies within Pit 2 have been sampled and sent to a local laboratory for analytical testing.
RESOURCE UPGRADE
Cokal continues to evaluate the additional geological data from the surface mapping and is preparing an updated Report of BBM?s Coal Resources for Seams B, C and D.
Geological modelling of the coal geology of BBM East has included both previous and recent geological data from exploration boreholes and coal seam outcrops. The new geological model accurately defines the outcropping coal for Seams B, C, D and J in Pits 1, 2, 3 and 4.
The updated geological model has confirmed continuity of the coal seams, and that other than the few major faults initially identified in the first Resource Report (December 2011), there is no evidence of any other significant structural discontinuity of the coal geology of BBM East. This endorses Cokal?s Definitive Feasibility Study which anticipates minimal mining dilution due to seam continuity as well as the potential to use highly productive underground mining extraction methods such as longwall mining in the future beyond the DFS study period.
BBP Project
No exploration activity was conducted on BBP during this period as all drilling and exploration resources have been deployed to BBM to assist in the delineation of the coal seam in the KLM area.
AAM and AAK Projects
Cokal has a 75% share of Anugerah Alam Katingan (AAK) and Anugerah Alam Manuhing (AAM) projects also located in Central, Kalimantan, Indonesia. The AAK project area comprises of 5,000ha and the AAM project comprises of 10,000ha. Applications for the Exploration Forestry Permit (IPPKH) and Clean and Clear Certificates continue to be processed.
SNR Project
Applications for the Exploration Forestry Permit (IPPKH) and Clean and Clear Certificate continue to be processed.
PROJECT DEVELOPMENT
EARLY WORKS DETAILED ENGINEERING & CONTRACUAL DOCUMENTATION
Work has been completed to detailed design and quotation stage on a number of critical path construction items. By completing these items the project construction can commence as soon as the full funding package is available.
These items include;
? Plotting and survey of road corridor from the Barito River to BBM being carried out, 100% complete. The centreline of the road corridor has been established and control survey marks established for earthworks cut and fill control
? Additional geotechnical investigation for port, stockpile and bridge locations.
? Purnama Port land mapping completed
? Engineering design optimised and re-quoted
? Detailed river bottom and channel survey work completed for the load out port at Purnama and surrounding areas.
BBM DEFINITIVE FEASIBILITY
Further costing, delivery confirmation and price enquiries were carried out during the Quarter in order to confirm both the BBM Definitive Feasibility Study and consequent changes associated with the Detailed Engineering works carried out during the Quarter
MINING
A number of site visits by reputable mining contractors were made to the Bumi Barito Mineral (BBM) project during the Quarter reflecting the strong interest in the project by mining contractors and the current over capacity of mining equipment and services in Indonesia from the downturn in the thermal coal sector
RIVER BARGING
Since obtaining the Port location approval, work has continued on obtaining design and construction approval of the facilities. The full design and construction approval application was submitted to the Department of Transport in Q4 2014, with approval expected in Q1 2015.
ENVIRONMENTAL REHABILITATION
Cokal continued last quarter to undertake environmental monitoring on site as part of ongoing baseline studies. Rehabilitation activities have continued over the last quarter with activities concentrating on finalising the rehabilitation of the exploration drill pads and access tracks, the riverside buffer area and the site access road. Approximately 12 hectares had been rehabilitated and near on 4,000 plants from the BBM nursery used as part of the rehabilitation activities.
APPROVALS & EXTERNAL RELATIONS
BBM PRODUCTION APPROVAL ADVANCES?UPDATE
As reported previously Cokal received the Izin Princip Ijin Pinjam Pakai Kawasan Hutan or ?In-Principal Forestry Permit? for its BBM Project. The In-Principle Forestry Permit is the last stage prior to the issuance of the ?Borrow and Use of Forest Area Permit (Ijin Pinjam Pakai Kawasan Hutan (?IPPKH?)) which allows the Company to start construction and mining.
The In-Principal Forestry Permit has been issued for an area covering 1,242 ha which enables the development of the port, haul road and the initial development of the mine site once the conditions of the In-Principal Forestry Permit are met.
Cokal has fulfilled all of the administrative obligations necessary to obtain the full IPPKH. It was expected that the IPPKH would have been issued Q4 2014; however, delays associated with process changes due to the amalgamation of the Environment and Forestry Department under the new Government has pushed back the expected issue of the IPPKH to Q1 2015.
On the 26th of January, 2015 the Indonesian Government announced the commencement of the BKPM as the new one-stop integrated service (PTSP) to simplify investment licensing procedures. This move is expected to free up the issuing of the final borrow and use permit for the BBM project. Detailed landowner and land use mapping is complete for the Purnama Port and now substantially completed for the haul road corridor. Mapping of the first development areas within the mine area is scheduled to commence in Q12015.
BBM PORT DESIGN APPROVAL
BBM has submitted its full application to the Transport Department to have the design of the Purnama Port facilities approved for construction. The approval from the Transport Department expected in Q12015.
BBM FOREST INVENTORY SURVEYS
BBM has concluded the forest inventory surveys for the Port and Haul Road IPPKH areas during the last quarter. The inventory surveys for the initial mine development area will be completed in Q12015 in line with the issue of the full IPPKH. The data collected during the forest inventory surveys will be used to establish the various Government taxes payable by Cokal for activities in Production Forest areas.
BBM WEST BLOCK EXPLORATION IPPKH EXTENSION
The application remains under evaluation by the Environment and Forestry Department due to delays associated with process changes due to the amalgamation of the Environment and Forestry Department under the new Government. Approval is expected in Q1 2015 and once the extension is issued, BBM can commence exploration in the BBM West Block.
BBP PRODUCTION APPROVAL ADVANCES-UPDATE
The IUP production / operation (Mining Lease) licence is still with the Murung Raya Bupati for signing. Whilst expected to be issued during this quarter it is now expected to be issued in Quarter 12015.
Cokal has submitted its application for the Clean and Clear Certificate Exploration from the Director General of the National Mines Department formalising the previous award of Clean and Clear status. As reported previously award of the Clean and Clear certificate has been delayed due to workloads in the Mines Department and this continued last quarter. Cokal has continued with discussions with the Mines Department and it is now expected the granting of the certificate will occur in Quarter 12015 in parallel to the issue of the IUP production / operation.
TBAR EXPLORATION FORESTRY PERMIT
Cokal continued during the last quarter to progress the Exploration Forestry Permit for TBAR with the Central Kalimantan Provincial Government. Site visits by the Provincial Government were expected to occur during Quarter 42014 and the issue of the Provincial Government technical recommendation expected early Quarter 1 2015. Due to Cokal?s focus on fulfilling the administrative requirements to obtaining the IPPKH for BBM, together with workloads within the Provincial Forestry Department the site visit to the TBAR concession has been delayed until Q1 2015.
CORPORATE
BBM Project Financing
Discussion with Platinum Partners on the previously announced project financing offer continued during the quarter. We continue to work closely with Platinum Partners during the quarter as the bridging loan funded both early works program and the completion of the BBM IPPKH approval process. The granting of the final Forestry Borrow and Use permit is a critical condition precedent for the project financing and as such increased work on the final detailed legal aspects of the project financing facility will occur over the next quarter. (end of excerpt)