Global metallurgical coal group Cokal has submitted an Environmental Impact Study (EIS) for the Bumi Barito Mineral (BBM) project in Central Kalimantan. The EIS outlines development of mining operations up to an annual output of 6 million tonnes, and includes the integrated development of the mine, haul road and river barging terminal.

Cokal has previously announced the results of a pre-feasibility study (PFS) which divided the development in two stages with stage 1 based on an initial 2 million tonnes/annum direct ship mining operation and a potential expansion incorporating coal processing and washing in stage 2.

Modelling of the stage 1 development indicates healthy margins producing an NPV of US$497 million from a project built for a low capital cost of US$100 million. The project is now moving through a definitive study with the aim of achieving first production in quarter 2 of 2014.

Cokal’s executive chairman Peter Lynch says the company is growing into a significant global metallurgical coal producer.

“We have started to expand our team ahead of the expected project development with the employment of civil engineers, mining engineers and project managers, as well as substantially increased our community liaison and environmental staff,” says Cokal’s managing director Jim Middleton. “We are proud of the experienced and competent team of Indonesian mining professionals we continue to attract.”

Cokal has progressed the 19,400 hectare BBM site quickly since completion of the PFS in November last year. There is significant additional drilling capacity now on site, land acquisitions to allow for access roads have been completed and the construction of a major base camp and access roads is advanced.

The drill program is aiming to identify additional resources from the previously announced exploration target of between 200 and 350 million tonnes.

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