Jatenergy updates Indonesian coal projects
Monday, January 30 2012 - 03:57 AM WIB
Jatenergy Ltd reached the tipping point in the December quarter in the transition to becoming a meaningful energy player. Mining operations commenced on its central Kalimantan coal projects and the local 100 % subsidiary was fully incorporated and office opened in Jakarta for business. Significant progress has also been made to advance other new opportunities to maximise the growth potential of our business in a rapidly growing Asian energy market.
Jatenergy announced last August that it had reached conditional agreement for a new coal mining joint venture. The Jongkang project is located 5km along an existing haul road from the Mahakam River, where there is a crushing and stockpiling facility and conveyor loading for barges, and about 25km from a major export hub for Indonesia?s coal industry at Samarinda. During the last quarter, technical and legal due diligence was completed and a decision made to proceed with the investment. Jatenergy also made a decision to invest in a separate joint venture covering an existing coal mining operation known as Jongkang II.
Jongkang I and Jongkang II are being developed in JV arrangements with a local Indonesian partner. Jatenergy has already covered the majority of the working capital costs of both projects (around US$1m) in return for 30% of the mining margins and the ability to market the entire output of both projects.
During the last quarter, a production licence for the Jongkang I mine was issued and an ongoing drilling program was commenced to outline an in-situ coal resource for mine planning and production purposes. That drilling has outlined an Indicated Resource of 97,000 tonnes of thermal coal in accordance with the guidelines of the JORC code for the first planned mining pit. Drilling is currently underway to delineate a second pit, and it is intended that a third pit will follow once the current work has been completed. Mining at Jongkang I has commenced and coal sales are expected to commence during the first quarter of 2012.
Contractors have also been working at Jongkang II, where the focus has been on stripping additional over-burden at the base of the exposed coal seam to maximise extraction tonnage. The seasonal weather conditions have delayed initial coal sales, which are now expected to be made in February 2012.
The Company continues the progress the Atan Bara and Katingan projects which are in the process of applicable regulatory approvals.
Incorporation of PT Barata Energy
PT Barata Energy holds project rights to the Atan Bara and Jongkang projects. During the last quarter, PT Barata Energy completed its incorporation process and now has an operating office in Jakarta. (end of excerpt)