Kaltim Supacoal to complete coal upgrading modification works

Australian-listed firm White Energy Resources (WEC) said on Friday that it is expecting that all outstanding plant modification works in its East Kalimantan coal upgrading unit PT Kaltim Supacoal (KSC) will be completed by September 2011, enabling a ramp-up to full production capacity by the end of the 2011 year.

?KSC continued to make sound progress in respect of a number of engineering modification works which are necessary in order to enable the Tabang plant to run at its design production capacity, with the relevant design, procurement and fabrication works all progressing to schedule,? the company said.

As can be expected, the modification works referred to above have continued to impact day to day operations at the plant. Notwithstanding this, WEC remains confident that the ongoing viability of the Tabang plant will be proven once modification works are complete, it said.

Recently, approximately 15,000 tonnes of briquetted coal which had been in stockpile for over 6 months was moved from KSC?s stockyard to Bayan?s Tabang mine stockyard. This briquetted coal was extensively sampled and tested. Despite the briquetted coal having been exposed to the elements for a lengthy period of time, test results show that it had not reabsorbed moisture which provides further verification that the core binderless coal briquetting (BCB) technology is working as expected

Following completion of the plant modifications referred to above, KSC will refocus its attention on the construction of additional plant modules in Indonesia, it added.

KSC is joint venture firm between WEC, which owns 51% stake together with its partner Indonesian coal producer PT Bayan Resources (49%). The JV is building a coal upgrading plant in Tabang with a production capacity of 1 million tonnes per annum (MTPA). The partnership is planning to increase the capacity to 5 MTPA.

In relation to the IUP application, as previously reported the relevant applications have been submitted to the local Bupati government and are currently being processed. KSC and its external Indonesian lawyers were also liaising with officials from the Directorate General of Mineral and Coal (DGMC) in an attempt to expedite this process.

A letter recently received from the DGMC confirmed that KSC should continue its IUP application with the local Bupati and that only one Special IUP (Processing and Refining) was now required, and that a second IUP covering sales and transport was no longer needed.

Meetings with the Bupati to finalise the IUP application are currently taking place and KSC expects it to be issued imminently. (romel)