Jatenergy obtains loan to fund Jongkang mine mobilization
Wednesday, May 28 2014 - 03:55 AM WIB
ASX-listed Jatenergy Limited announced Wednesday that it has negotiated a US$100,000 loan to finance the mobilization of excavators and trucks to the Jongkang coal mine site in East Kalimantan as dry weather allows the company to resume operation.
?Seasonally dry weather in Kalimantan has allowed operators at Jongkang to pump and drain the existing mine pit to access previously identified coal. Over the next four weeks excavators will be smoothing road access and removing overburden to excavate identified coal,? the company said in a statement.
The loan provides Jatenergy with extra capital to rework the Jongkang mine site. It is a profit share arrangement earning 50 percent of Jatenergy?s residual share of the profit from the mine.
At Jatenergy?s election it has the opportunity to convert the loan at 2 cents a Jatenergy share during the life of the Jongkang mine site. There is no interest payable on the loan.
Chris Flanagan Indonesian Manager said, ?As coal prices have at least stabilized it has enabled us to restart exploitation with an economic stripping ratio. Due to its high calorific value and low ash and sulphur the coal has always found ready buyers wishing to either sweeten cargoes or export directly by barge to neighbouring countries.?
The company said it continues to work with its local partner in further drilling the site to map out future opportunities in the area.
The Jongkang I and Jongkang II projects are currently in production and produced around 35,000 tons over the past year and were developed in December 2011 as part of a Joint Venture arrangement with a local Indonesian partner. Located in East Kalimantan approximately 5 km along an existing haul road from the Mahakam River, and about 25 km from a major hub of Indonesia?s coal industry at Samarinda, each concession is covered by a production license comprising 100 hectares.
Editing by Reiner Simanjuntak