Yinfu acquires coal mine in Kalimantan

By Romel S. Gurky

Yinfu Gold Corporation recently stated it has entered into a definitive agreement to acquire a 51 percent interest at Hitric Resources Ltd, a Singaporean company that owns 80 percent rights for a 1,116 hectares coal mine located in Tanah Bumbu, South Kalimantan. The acquisition, giving Yinfu up to 3.3 million restricted shares, is valued at US$1.25 million.

Yinfu stated that Hitric received the exploration license on February 25, 2010, valid until February 25, 2017. Initial Exploration and mine design and plans have been concluded and production due to start in March 2013 after the issuance of the production license.

Initial first year production is projected to reach 150,000 tons of high grade thermal coal with an estimated revenue at just above US$13.5 million and an earnings before interest and tax just above US$4.5 million. Year two revenues and production are projected to be at double year one, as a mining production plus shipment efficiency gains traction.

Infrastructure, the company said, is already in place with modern roads and more than 5 port locations available for access, including integrated crushing and conveyor loading facilities serving the area where the coal mine is located.

"We are very pleased to have acquired the Kalimantan coal mine to add to our asset base and diversify our resource revenue streams. We have existing coal buyers from power plants in China which we will supply via long term supply contracts. We believe that this acquisition will produce excellent revenues for Yinfu," company CEO Tsap Wai Ping said.

Editing by Er Audy Zandri