PHI Energy acquires Indonesian coal assets

US firm PHI Energy Corporation, a minority owned subsidiary of PHI Group, Inc., in partnership with AXN Group LLC has signed an agreement to purchase the coal mine assets of PT Dian Anuhgrah Pratama (DAP).

PHI Group is a company engaged in M&A advisory services, real estate development, mining, and energy.

According to the agreement, PHI Energy will acquire an estimated mineable coal reserve of 10,000,000 metric tons located in an area of approximately 423 hectares, at Kapur IX district, Lima Puluh Kota regency, West Sumatera, from DAP in exchange for 20,000,000 shares of common stock of PHI Energy Corporation valued at $1.00 per share, the firm sid in a statement=.

The closing of this transaction is scheduled to take place on May 7, 2011. As part of the agreement, PHI Energy Corporation is irrevocably committed to filing a registration statement with the United States Securities and Exchange Commission to become a fully reporting publicly traded company and will do so within 90 days following the closing.

PHI Energy Corporation also agrees that, during the first 60 days immediately following the initial effective trading of its common stock, if the average closing price of the company's stock falls below $1.00 per share, the Company agrees to issue additional shares of its authorized but unissued common stock to DAP such that the total value of all the shares of common stock received by DAP will be equal to a minimum of $20,000,000.

Sample analysis data of the coal assets acquired show ash content of 10.66%, total sulfur 0.97%, total moisture 4.78%, volatile matter 46.36%, fixed carbon 41.43% and caloric value of 7,338 Kcal/kg.

Herman Koswara, Director of DAP, said, "We are pleased to participate in PHI Energy Corp's growth strategy through this relationship and look forward to creating substantial value for all parties involved."

Allen Wu, Chairman of PHI Energy Corp, said, "The acquisition of the DAP coal assets is the first step of our plan to engage sizable sources of coal supply to meet the demand of potential long-term off-take contracts. We are confident that this transaction will bring significant economic benefits to our shareholders." (romel)