Handini reports Indonesian coal production, exploration
Friday, January 30 2009 - 12:41 AM WIB
The Company acquired, effective 17 October 2008, its coal mining operation by the acquisition of 100% of China Time International Limited which delivered ownership of a 60% interest in PT Nusantara Termal Coal (NTC), which holds a 30-year Concession in Muara Bungo, in Jambi Province, Sumatra under a Coal Contract of Work with the Indonesian Government.
This Muara Bungo Concession, which covers an area of 28.6km2, has JORC compliant reserves as detailed in the Company?s July 2008 prospectus, which can be accessed on the Company?s website (www.handiniresources.com).
Mining originally commenced in March 2006 with more than 2 million tonnes of coal being produced up until December 2008.
MINE PRODUCTION
MUARA BUNGO CONCESSION
Coal Production
July to December 2008
| July | Aug | Sep | Oct | Nov | Dec | Total (Mt) |
| 221,578 | 194,849 | 200,043 | 21,970 | - | - | 638,440 |
The monthly coal tonnage was steady up until October at which time the mine was temporarily closed for the rainy season. This rainy season closure afforded NTC management the opportunity, assisted by the Department of Energy and Mineral Resources (DEMR) to review the current sub contract arrangements for the mining operations. As a result of this review new mining agreements will shortly be signed by NTC, in a move which, it is hoped, will deliver greater mine efficiencies and performance.
It is anticipated that mining will re-commence at the end of the rainy season in mid-February, subject to DEMR being satisfied with the measures that have been taken and will be taken. Budgeted production over the next 12 months is 1.5 million tonnes.
The Company has extended a working capital loan of $1 million to NTC.
EXPLORATION
TABALONG PROJECT
The Company (via its proposed 100% owned subsidiary, PT Tabang Mineral Ventures (TMV)) has entered into a Memorandum of Understanding (MOU) with PT Global Multi energy (GME) whereby HRL shall provide project funding to GME to explore and ultimately develop a new mine in Kalimantan. In this regard the Company has extended an advance of $1.1 million to TMV to finance its activities.
GME has been granted a coal exploration permit over the area, which is located in Kalimantan Selatan. The permit area has good accessibility via existing logging tracks or by sea through the Makasar Strait.
Exploration
Initial exploration has found 32 coal surface outcrops with thicknesses ranging from 5 cm to 1.3 metres. An initial drilling programme has also commenced with 17 cores completed to date with a maximum depth of 36 metres for a total of 500 metres. 8 cores contain coal with thicknesses between 0.27 metres and 2.98 metres.
The drilling completed to date has covered only a small portion of the outcropped area. Further detailed drilling of depth ranges from 500 to 1,000 metres, especially on strike coal seams will be carried out over the coming months to establish the coal distribution in the entire exploration area of 2,056 hectares.
Six samples have been analysed from the initial drilling programme, as well as some random outcrop samples. The results indicate the coal is of a high quality in excess of 6,000 GCV/kg. (end)