Kangaroo reports increase Mamahak coking coal output

Perth-based coal producer Kangaroo Resources Limited (KRL) said on Wednesday that semi-soft coking coal sales for January 2011 from its 100%-owned Mamahak coal project in East Kalimantan totalled 20,950 tonnes, more than double December quarter sales of 9,882 tonnes.

The coal sales generated approximately US$2.0 million in revenue, which has already been received by the company. Another 15,700 tonnes is waiting at the Mamahak port site for immediate sale, the company said.

As part of the recently announced transaction and strategic alliance with Indonesia-listed coal mining group PT Bayan Resources, KRL will now be selling its Mamahak cool at Bayan's port site/mine gate, it said.

This means that the company does not have to manage the logistics associated with barging, stockpiling or ultimate completing coal sales from this project, which in turn means that KRL can concentrate on exploring for, mining and producing coal. It also means that the company has a shorter sales cycle, which will free up cash to facilitate the ramp-up of production.

KRL has already begun working with Bayan on the Mamahak project, taking advantage of Bayan?s experience and expertise to assist ramp up the project as quickly as possible.

KRL Managing Director, Mark O?Keeffe, said: ?These initial strong coal sales for 2011 reflect the immediate impact of our new working relationship with Bayan at Mamahak. KRL is now able to focus on production and exploration matters and no longer has to manage the downstream issues relating to logistics. We anticipate continuing with the production ramp-up and further sales of coal at Mamahak are imminent.? (denny)