Western Manganese is taking its first steps into non-manganese projects, signing an agreement to acquire four coal tenements in East Kalimantan for the payment of 10 million shares. The company has spent six months investigating the acquisition opportunities in coal and has decided on acquiring four companies which own coal tenements over a combined area of 5000 hectares in the Panajam Paser Utama region.  1

The Penajam Paser Utama project is made up of four close mining business areas about 35km northwest from Balikpapan on Borneo Island.

Western Manganese will acquire up to 100% of the shares of PT Pratama Energy Alam Tujuh (PEAT), PT Adi Mecha Kontekindo (AMK) and PT Samboja Perdana Agung (SPA), which own exploration licences for bituminous coal, and PT LB Prima Coal (LBPC), which holds a production licence within the Balikpapan formation for sub-bituminous coal.

“The area has simple logistics and transportation requiring short road hauling, followed by short barging to the coal terminal as well as being easily accessible for exploration and operations,” says Western Manganese’s executive director Colin Locke.

Exploration activity on the tenement areas has been very limited to date. Western Manganese plans to implement initial exploration programs including a comprehensive mapping exercise to identify the areas with the highest near term development potential.

BHP Billiton operated and produced coal in the region south of the LBPC tenement about 10 years ago. The area is now mined by local miners under a local mining permit from the head of regency. General characteristics of the region include major coal seams ranging up to 1.5 metres in thickness of very high calorific value coal.

Western Manganese currently holds the rights to two promising manganese exploration tenements near Atembua in West Timor, which is regarded as an emerging manganese province. The company plans to be the first company to utilize best practice exploration techniques to explore the manganese deposits of West Timor.