Orpheus Energy secures Papua coal projects
Friday, November 11 2011 - 12:57 AM WIB
The Papua project covers an area of 540,430 hectares and the tenements are located 40-80 km from the west coast of Mamberamo in Papua. Coal outcrops throughout the tenement area and recent coal samples analysed by Mega featured: low ash (4.2 - 5.1 percent adb), low sulphur (0.29 - 0.38 percent adb), total moisture (14.1 ? 24 percent ar) and an energy content of 5311-6043 Kcal/kg.
Orpheus is currently undertaking technical due diligence and will conduct a site visit in a fortnight to establish an initial exploration target for up to three of the 12 blocks.
Preliminary mine planning indicates either trucking coal to a deep sea port area, to be constructed by the joint venture, or barging the coal down river for loading onto geared vessels or by floating crane assist.
The realization of venture agreement is pending on the completion of technical and legal due diligence.
Under the agreement, Orpheus will pay an initial deposit of A$2 million to Mega for a 37.5 percent equity interest in one of the Papua Project production IUPs. Orpheus has an option to make further equity contributions of up to A$13 million in respect of the remaining 11 blocks in the Papua project.
In order to secure the initial deposit, Mega will grant a pledge of shares of its 100 percent owned PT Alum Duta coal mine and near term coal production asset, PT Citra Bara Prima, both located in South Kalimantan.
?The Papua transaction is very significant as it has the potential to develop into a large coal project, and further demonstrates the power of the strategic alliance that Orpheus enjoys with our partner Mega Coal,? Executive Chairman Wayne Mitchell said.
?Our intention is to rapidly complete the due diligence on the Papua project and move into production as quickly as possible,? Mitchel said. (demas)
