Pan Asia updates Indonesian coal, manganese projects
Thursday, December 17 2009 - 02:43 AM WIB
Pan Asia Corporation Ltd. (PZC) provides this important update on the review of the extensive portfolio of projects being acquired from Innovation West announced to shareholders on 23 November 2009. The Company?s executives have recently returned from visiting the highest priority projects and it is clear that the proposed acquisition of projects represents a significant company changing growth opportunity.
The Company believes the suite of assets being acquired is a platform to build a significant Indonesian-focussed resource company with increasing thermal coal production from a number of operations. The extensive pipeline of coal and manganese exploration projects provides the Company with exposure to vast parcels of prospective ground in the prolific coal fields of eastern Kalimantan, as well as the emerging manganese province on Flores Island and West Timor. It is expected that exploration activity, including drilling and detailed project evaluations will begin in the coming weeks.
Due to the large number of projects under review, the company prioritised the projects on the basis of first assessing those in production, near development stage or with high priority exploration status. The other projects, while prospective, will necessarily be assessed in detail at a later stage.
PROJECT DETAILS
JASA TAMBANG NUSANTARA (JTN), East Kalimantan: In Production
The JTN concession is located in eastern Kalimantan, approximately 75km SW of Balikpapan. The concession covers 2,750Ha, with a small open pit mine currently producing around 20,000* tonnes per month of sub-bituminous thermal coal with typical analysis (air dried basis): 5,600-6,000 Kcal/kg, 0.3-0.7% total sulphur, 8-10% total moisture, 4-8% ash. Observations from site indicate the current mining activity is in the early stages of extracting two near-surface coal seams with thicknesses varying from 0.8-4m. The seams dip shallowly to the south east at 80-150.
JTN owns and operates coal handling and barge loading infrastructure approximately 7km from the mine site where it currently loads shipments twice weekly. Loading capacity is presently rated at around 200tph.
PZC plans on implementing expansion plans to ramp-up production to 40,000* tonnes per month over the coming 3 month period. Additional plant and equipment will be mobilised to site to assist in achieving this goal, with the existing infrastructure capable of handling the increased throughput.
In addition, PZC will commit to undertake a detailed near-mine drilling program in order to assess the potential for further production expansions and optimising future mine planning and scheduling. Drilling will focus on the estimated 6km of inferred strike length of coal seams on this concession.
*The above production results and targets are based on information provided to the company by the vendors during the due diligence process.
CV BUNGA BONE (CBB), East Kalimantan: In Development
The CBB Project has a recent history of small-scale production and sales of sub bituminous thermal coal from a 100Ha concession area located approximately 30km SE of Samarinda, Eastern Kalimantan. Barge loading infrastructure with a capacity of approximately 20,000-30,000* tonnes per month is located 7km from the mine site and is ready for immediate start-up. Coal quality is expected to be in the range of 5,600-5,800 Kcal/kg, 10-15% moisture, 5-10% ash and 0.5-0.8% sulphur.
With some additions to the existing mining fleet and infrastructure, the Company is aiming for an initial production target of 50,000* tonnes per month.
Four coal seams have been identified at CBB, with thickness varying from 1.lm to 5m and dipping at 12-18? to the SE. A significant amount of near-surface coal has recently been exposed and is ready for extraction (see Figure 5). The Company is also acquiring drilling data which will be further verified by additional drilling to take place in the first quarter of 2010.
*The above production results and targets are based on information provided to the company by the vendors during the due diligence process.
ARCHIPELAGO TIMOR PERKASA (ATP), East Kalimantan: In Development
A significant amount of mine development has been undertaken at ATP, with the extraction of 1 00,000t* of coal within the last year. Coal is present in seams up to 5m thick which exhibit high calorific values, up to 6,700 Kcal/kg. The sulphur content is elevated such that this coal will require blending with lower sulphur coals, such as material from JTN, to produce a saleable product. The coal seam outcrops intermittently over a 3km strike length, some of which has been drilled by the project vendor.
The 3,930Ha ATP concession is located approximately 90km SW of Balikpapan and has direct access to owned and operated barge loading infrastructure.
A significant near-mine exploration and resource delineation program is being planned for ATP. The Company believes this coal will add significant value as a blending coal with other projects nearby, particularly JTN.
*The above production results and targets are based on information provided to the company by the vendors during the due diligence process.
ABADI PANDU SELARAS (APS), Central Kalimantan: High Priority Exploration
An exploration application has been submitted over an 8,000Ha area in Central Kalimantan which is targeting coking coal and high quality thermal coal. Several photos of outcropping coal seams up to 3m thick are available from this.
Further exploration and evaluation work is planned to begin within the coming weeks to ascertain the aerial distribution of outcropping coal, with a drill program desgined to define the size and prospectivity of this area.
SARANA MANDIRI UTAMA (SMU), East Kalimantan: High Priority Exploration
The 5,250Ha SMU concessions are located in the north of Kalimantan with easy access to the adjacent river system. The company is acquiring a significant amount of drilling data which will be verified by additional drilling undertaken by the company in the coming weeks. The company believes the SMU concessions appear highly prospective for the rapid dealineation of potentially large areas of near-surface thermal coal.
An initial production target of 40,000 tonnes per month appears feasible.
BHARATINDO MINERALS MANDIRI (BMM), Sumatra
The 4,500Ha BMM concession is a greenfields project area which the company believes has excellent potential to host near-surface thermal coal. The project vendor reports a near-continous coal seam outcropping for over 1.6km. Coal quality analysis and seam thickness information is not yet available, however will be investigated further by the company early in 2010. The area is serviced by several logging roads with only slight topography.
Coal terminals / Infrastructure
The company visited the Samboja site and met with representative of the state owned company specialising in sea barge loading facilities. the review of feasiblity data is ongoing and future updates will be provided as further progress is made.
Manganese concessions, Flores Island, West Timor NTT: High Priority Exploration
A number of manganese concessions covering more than 15,000Ha are being acquired as part of the Innovation West transaction. These projects are located in Flores, West Timor, East Kalimantan and Sumatra.
Following the site visits undertaken by the Company?s technical staff, the concessions on Flores Island are considered highly prospective for the discovery of in-situ primary manganese deposits. Figures II and 12 illustrate massive manganese oxide (pyrolusite) contained within a large boulder as part of a small landslide. The size of the boulder and the morphology of the immediate area suggest this boulder has not traveled far from its source. Detailed geological mapping and prospecting will be undertaken in areas directly upslope from this boulder with the aim of identifying the original source rocks.
Additional exploration work will be carried out on the concessions in West Timor to fully understand the geology of this region and ascertain the prospectivity for hosting primary manganese deposits of significant size. Recent site visits indicate predominantly alluvial manganese occurrences in these concessions. (end)