Ivanhoe updates E. Kalimantan coking coal project

Vancouver-based mining firm Ivanhoe Mines Ltd. has released its 2009 second quarter report. The following is an excerpt of the report on the company?s operation in Indonesia.

SouthGobi holds an 85% interest in the Mamahak Project in East Kalimantan, Indonesia, with provisions to increase its interest to 100%.

SouthGobi has filed the required permit applications for mining, coal transportation and a barge loadout facility for the area. SouthGobi has engaged two smaller mining contractors who have significant experience in operations similar to Mamahak. In April 2009, initial pre-development work was started with the removal of waste rock, extraction and roadwork.

The 34-kilometre coal haul from the SW deposit to the barge port on the Mahakam River has been completed and commissioned. The installation of a river barge loading terminal which is located at Long Habung on the Mahakam River is also completed, as well as, installation and commissioning of truck weigh scales, coal crushing equipment and a mine site coal analysis laboratory.

In May 2009, SouthGobi signed a coal marketing agreement with Glencore International AG (Glencore). Under the terms of the agreement, Glencore will provide SouthGobi with coking coal marketing expertise and river barging/vessel loading logistical services. With the completion of the coal marketing agreement, SouthGobi is planning to ship an initial 30,000-tonne test cargo from the Mamahak coal project to potential Asian customers during Q3?09.(end of excerpt)

Editor?s note:
Ivanhoe Mines is SouthGobi Energy Resources' largest shareholder, currently owning, directly and indirectly, approximately 80% the issued and outstanding shares.