PHI appoints Runge to conduct due diligence of TSA coal concessions

By Ruli Setiawan

Energy and resources company PHI Group, Inc. said it has engaged PT Runge Indonesia, a subsidiary company of Australian-based advisory and technology group RungePincockMinarco Ltd, to undertake a staged study of PT Tambang Sekarsa Adadaya (TSA)'s coal concessions in West Sulawesi, Indonesia.

The technical due diligence is part of PHI Group's validation of the resources, reserves and quality of the TSA coal concessions prior to the closing the purchase of 70 percent equity ownership in TSA, the company said in a statement received Wednesday.

This independent assessment by Runge aimed to result in the production of a Resource and Reserve Statement in conformance with "The Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, the JORC Code," subject to the mining concessions having suitable ore potential, PHI said.

A preliminary geological report by TSA has shown 71,038,925 metric tons (MT) of measured and 205,334,343 MT of indicated coal resources over an area of 9,690 hectares in West Sulawesi, Indonesia and laboratory analyses have shown Gross Calorific Value of approximately 6,200 Kcal/Kg (ADB).

However, the study by Runge will provide an independent and more accurate understanding of the coal deposits at these concessions. If the due diligence results are satisfactory, PHI Group will proceed to close the purchase of TSA and continue with the mine planning before engaging an international mining contractor to manage the production and operation of the mine.

PHI Group has received indications of interest from a number of buyers in the Asia Pacific region interested in purchasing several hundred thousand MT of coal per month for power plants and other factories.

Editing by Reiner Simanjuntak