Geo obtains approval for acquisition of S. Kalimantan coal mine
Tuesday, November 29 2016 - 01:20 AM WIB
SGX-listed Geo Energy Resources Limited announced on Monday it had on November 25 obtained approval in-principle from the Singapore Exchange Securities Trading Ltd for the proposed acquisition of 100 percent interest in Fortune Coal Resources Ltd, a Singapore-registered company.
The company said in an update statement that the approval in-principle granted by the SGX-ST for the listing and quotation of the consideration shares is subject to certain conditions, among other things, compliance with the SGX-ST?s listing requirements, and shareholders? approval being obtained for the proposed acquisition.
Fortune Coal indirectly holds an effective 98.73 percent stake in PT Tanah Bumbu Resources, which holds coal concession in South Kalimantan Province.
As has been previously reported, Geo signed a conditional sale and purchase agreement on July 18 of this year with International Resources Investment Ltd for the acquisition of TBR for US$90 million.
The company said that the proposed acquisition is expected to increase the group?s total mineable coal reserves by another 44.4 million tons of coal. Spanning 489.1 hectares of mining concession, TBR?s coal mine has a Joint Ore Reserves Committee report (JORC) estimated proved coal reserves of 40.7 million tons of coal and a probable 3.7 million tons of coal with a minimum average calorific rate of 4,200 kcal/kg containing 34.4 percent total moisture, 39.4 percent volatile matter, 5.1 percent ash and 0.24 percent total sulphur.
Strategically located beside the coal mine belonging to the Group?s subsidiary, PT Sungai Danau Jaya (SDJ), TBR?s coal mine possesses similar qualities like thick coal seams, low strip ratio and close proximity to jetty. Acquiring an adjacent mine has synergistic benefits as most of the infrastructure and facilities are already in place for coal mining operations to commence.
Geo said the TBR coal mine is to start production in early 2017 and expand the group?s coal production to no less than 10 million tons in 2017.
Editing by Reiner Simanjuntak