Polo invests in Universal Coal Resources

By Romel S. Gurky

AIM-listed Polo Resources Limited, the natural resources investment company with interests in oil, gold, coal, copper, phosphate, iron and vanadium, announced on Tuesday that its subsidiary, Polo Investments Limited (PIL), has entered into a secured S$5,000,000 nominal value 15 percent redeemable convertible note (Note) with Universal Coal Resources Pte Ltd (UCR).

UCR is a company incorporated in Singapore, which, in turn, has entered into a conditional agreement to acquire an indirect 75 per cent interest in PT Transcoal Minergy Coal Project (TCM), a company incorporated in Indonesia, from a Pan Asia Corporation Ltd. (PZC) subsidiary.

TCM is the owner of a Production Operation Mining Business License in respect of a mining concession area in Mantewe district, Tanah Bumbu regency, South Kalimantan province. This comprises of 3,440 hectares and is a major coal producing province in Indonesia. The TCM Coal Project is focused on developing a two million tons (Mt) per annum underground mine delivering a high quality Bituminous Coal saleable product of some 6,200 kcal/kg specific energy (GAR ? Gross as Received). The current JORC Resource of 129 Mt (measured, indicated and inferred) has been derived from the southern area of the concession and there is potential to upgrade and increase the resource base through drilling the northern area. TCM?s production permit extends to April 2028. Further drilling and a full final feasibility study are required to be completed and forestry approval obtained prior to commencement of mine development. The TCM Coal Project will utilize existing coal transportation infrastructure including a 50 kilometer haul road to the river port at Batulicin, a major coal shipping center.

UCR is targeting a Singapore Stock Exchange Catalist Board listing and the Note entitles Polo to convert the principal outstanding plus any accrued interest into not less than 20 per cent of the share capital of Universal as enlarged by such conversion at any time up to 18 months from drawdown, or earlier upon the receipt of approval in principle to list. The funding under the Note will enable UCR to undertake value adds to the TCM Coal Project in addition to progressing its proposed listing. The Note is repayable 18 months from draw-down unless previously converted.

The Note is secured by TCM and underwritten by a personal guarantee and undertaking by Boelio Muliadi, an Indonesian national and major shareholder of Universal, guaranteeing the repayment by Universal of the principal amount and any accrued interest and undertaking to meet all the funding requirements of Universal and the TCM Coal Project for the proposed listing on or before Dec. 31, 2017.

Editing by Johannes Simbolon