Investing in an Underground Coal Mine in Indonesia

Transcription

1 Coal Supplying Key Resources into expanding Asian markets Investing in an Underground Coal Mine in Indonesia

2 Disclaimer Forward Looking Statements This presentation includes certain forward looking Statements. All statements other than statements of historical fact are forward looking statements that involve various risks and uncertainties. There can be no assurances that such statements will prove accurate and actual results and future events could differ materially from those anticipated in such statements. Such information contained herein represents management s best judgement as of the date hereof based on information currently available. The Company does not assume the obligation to update any forward looking statement. Qualified Person The technical information in this presentation is derived from Pan Asia s ASX releases, each of which has been reviewed by our competent person, Marek Rosa, as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Copies of prior releases are available on the ASX website or Competent Persons Statement The information in this release that relates to the Coal Resources of PT. Transcoal Minergy ( TCM ) is based on information compiled and reviewed by Mr. Marek Rosa, who is a Member of the Australasian Institute of Mining and Metallurgy (The AusIMM) and works full time for PT Kopex Mining Contractors based in Jakarta, Indonesia (Member of Kopex Group Poland). Mr Rosa is a qualified geologist who has more than 20 years of relevant mining and geological experience in coal, working for major mining companies in Poland (17 years) and in Indonesia (4 years) as a consultant. He has National Polish geological license No II-1140 for research, exploration, resource and reserve estimation of deposits of basic minerals and coalbed gas methane. During this time he has either managed or contributed significantly to numerous mining studies related to the estimation, assessment, evaluation and economic extraction of coal in Poland and Indonesia. He has sufficient experience which is relevant to the style and type of deposit under consideration especially for Underground Mining and to the activity he is undertaking to qualify him as a Competent Person for Reporting of Exploration Results, Mineral Resources and Ore Reserves. The estimates of Coal Resources have been carried out in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (December,2004) and Mr Rosa consents to the inclusion in this release of the Mineral Resources in the form and content in which it appears. MAREK ROSA M.Sc. (Geology), MAusIMM 2

3 Structure Why Underground Now? Key Factors to Consider The TCM Project 3

4 Indonesia Underground History Long History of Underground Mining GOLD Traditional underground mining since 700 AD in Sumatra Extensive underground mining in Sumatra and West Java during the Dutch era TIN Largest underground tin mine in the world - Belitung Island; pre World War 2 COAL Ombilin in West Sumatra from the late 1800 s 4

5 Notable Underground Projects Past & Present 5

6 Why it s Time for Underground Coal in Indonesia 3 rd Generation Coal Projects GEN U Near Coast High Coal Quality Available Infrastructure Already In Big Tonnages Possible High CAPEX & Mining OPEX INDONESIA S COAL CLOCK GEN 3 GEN 1 1 st Generation Coal Projects GEN O Open Pit Near Coast Big Tonnages Available Low CAPEX/OPEX GEN 2 2 nd Generation Coal Projects GEN O 2 Open Pit Longer Haul/Barge Lesser Coal Quality Needs Big Tonnage May Need Infrastructure 6

7 What Does Underground Mining Offer Investors? OFFERS High Coal Quality Large Tonnage Good Location Infrastructure In Minimum Impact on Other Stakeholders Forestry Possible Incentives NEEDS Expertise Technology High CAPEX Higher Mining OPEX 7

8 Key Factors to Look For in Underground Mining THE BIG PICTURE High Quality Coal Big Tonnage Potential Location and Infrastructure High Revenue per tonne Supports High CAPEX Offsets Higher Mining Costs KEY DETAIL - Technical GEOTECH PARTING OTHERS - Rock Integrity - Faulting - None or small (washing /yield) - Gas, water, spontaneous combustion etc 8

9 TCM Project South Kalimantan 75% interest (25% Local Partners) (3,044Ha) Immediately adjacent to PT Arutmin ATA mine 4 main coal seams dip into TCM High calorific value thermal coal - 6,500 6,800+ kcal / kg (adb) 114Mt of JORC measured, indicated & inferred resource, with potential to increase Potential to unlock value in stranded boundary coal via expansion of adjacent ATA open pit mine Haul road in (51kms to Batulicin Barge Loading Terminal) PT Arutmin ATA coal mine adjacent to TCM 9

10 TCM Project - Resource JORC measured resource = 35Mt JORC indicated resource = 35Mt JORC inferred resource TOTAL RESOURCE = 44Mt = 114Mt* * See Appendix 1 for details 10

11 TCM Project Concept Style of Mining Target Sellable Coal Mine Life Target Coal C.V CAPEX + OPEX pre production Mechanized Longwall 1.5Mt pa 15 years AR ~ US$150m US$200m 4 major exposed coal seams dipping into TCM area Conceptual project parameters targeted by the company and reviewed by PT Kopex Mining Contractors (KMC). These remain subject to results & further analysis (Completion of Feasibility Study). Haul road infrastructure at TCM 11

12 TCM Project What s Next? 1 st Quarter nd Quarter nd Half 2012 Completion of Current Feasibility Study Project Finance & Offtake Legal Project Development (Underground) 12

13 SUMMARY 1. It s Time for Underground Coal Mining in Indonesia 2. Underground Coal Brings Something New to the Partnership with Indonesian People Expertise / Technology / Large, Long Term Investment 3. Potential to Deliver Significant New Reserves for Indonesia, with Lowest Impact on Other Stakeholders Forestry / Agriculture / Local Communities 4. Mining Is A Marriage, Not A Date Underground Mining - A Longer Engagement 13

14 THANK YOU 14

15 Appendix 1 CURRENT JORC RESOURCES AT TCM TCM JORC RESOURCES MEASURED (tonnes) 35,602,319 INDICATED (tonnes) 35,109,149 INFERRED (tonnes) 43,910,420 TOTAL (tonnes) 114,621,889 Coal Quality Resource Summary The coal quality model will be further updated when all the coal quality results are in for the current drill programme. Washability tests and subsequent analysis of the results have been undertaken on a 500t bulk sample to develop a conceptual Coal Handling and Preparation Plant design. Further testwork and analysis of all quality data will lead to a specification of a saleable product, the results of this are expected later this month targeting a TS of ~1.0 with good yield. 15

16 Appendix 1 (Continued) PARAMETERS USED IN LATEST JORC NUMBERS 1. Completed 18 additional boreholes from current phase of drilling; 2. A total of 35 boreholes was used for the latest update of the resource estimation; 3. This preliminary resource update was made for the purpose of re-estimating the resource numbers and evaluating the tectonic structure of the rocks; 4. Approximately 6 boreholes remain to be done in the present drilling program; 5. All finished boreholes were geophysically logged, samples taken and sent to laboratories; 6. Profiles, logs of boreholes and seam correlations have been completed; 7. Collar coordinates have been completed; 8. Laboratory testing: quality, Geotech, gas methane- not yet completed but underway; 9. Quality model still to be updated once all quality results received; 10. Full version of resource statements to be elaborated after all drilling and laboratory testing completed. 16

17 Appendix 1 (Continued) Drill Spacing in the Calculation of Resources Based on the better understanding of the complexity of the deposit achieved through the current drill programme, Kopex has now sub-divided resources into categories based on the following drill spacing: 17 OCTOBER JANUARY 2011 MEASURED <500m <250m INDICATED m m INFERRED 1000m-2000m 500m-1000m 17