Kangaroo provides E. Kalimantan coal projects overview
Monday, January 31 2011 - 01:19 AM WIB
(31 January 2011)--The December 2010 Quarter marked a major turning point for Kangaroo Resources Limited (KRL), with the Company announcing on 29 December 2010 a transformational $277 million asset acquisition together with a Strategic Alliance and operational MOU with one of Indonesia?s largest coal mining companies, PT Bayan Resources Tbk (Bayan).
The proposed acquisition of the large-scale Pakar Thermal Coal Project in East Kalimantan, together with the strategic alliance and operational alliance with Bayan, will represent the culmination of KRL?s asset development strategy within the Indonesian coal sector over the past 18 months.
Following completion of the transaction, KRL will be a rapidly growing international coal producer with a major strategic shareholder in Bayan which will also manage all of its operations, a strong balance sheet and three major coal production hubs:
- Mamahak: production Feb 2010 (coking coal)
- Pakar: production targeted FY 2011 (thermal coal)*
- GPK: production targeted FY 2011 (thermal coal)
*pending shareholder approval
Prior to announcing the Pakar/Bayan transaction, the Company secured a significant new cornerstone investor group through a $23.8 million share placement completed in December and also completed the acquisition of the remaining 15% of the Mamahak Coking Coal Project in East Kalimantan, increasing its ownership to 100%.
The Company also completed a commercial review of its GPK Thermal Coal Project and, as a result of the newly-established association with Bayan, intends to retain the GPK asset and will target resumption of coal operations at this project in 2011, and also confirmed the appointment of experienced Indonesian-based businessman, Galih Kartasasmita, as a Director.
The Mamahak Coking Coal Project completed 9,882 metric tonnes of coal sales (FOB Mamahak port facility) during the Quarter to 31 December 2010, generating revenues of $828,000. Coal sale pre-payments received during the quarter generated an additional $320,000.
During the March Quarter, the Company will work towards completing the Pakar Project transaction as rapidly as possible by completing all required regulatory and due diligence processes. This will include obtaining an Independent Expert?s Report on the transaction and obtaining shareholder approval at a meeting to be convened as soon as possible.
While the transaction is being completed, KRL and Bayan will work closely together to integrate their operations and activities and transition operational management of all KRL?s existing coal projects in Indonesia. (end of edited excerpt)
Editor's Note: GPK located in the regency of West Kutai, East Kalimantan has started production. It targeted to produce up to 100,000 tons of thermal coal per month by early 2011, and ultimately up to 3-4 million tons per annum (Mtpa) by 2012.