Borneo Seeks to Acquire Thermal Coal Mining Rights in Kalimantan

Thu, 25 January, 2012

Borneo Resource Investments Ltd. (OTCPK: BRNE) said it seeks to acquire highly prospective thermal coal mining rights primarily in East Kalimantan, Indonesia, a highly-stable mining jurisdiction.

"Our objective is to add value through grassroots exploration and target refinement and then seek option or joint venture partners through to production," Borneo Chairman and CEO, Nils Ollquist commented.

Borneo's business model is that of a Project Generator and coal trader. The Project Generator model is particularly suited to the company's ongoing interest in the East Kalimantan province where Borneo has a wealth of intellectual capital and experience.

To add to cash flow and reduce the need for dilutive financings to fund its activities, Borneo engages actively in coal trading. Management seeks to identify and broker transactions between buyers and sellers, earning a profit as the intermediary.

The company currently has interests in two thermal coal exploration projects in East Kalimantan province with an estimated resource potential of 12-14 million metric tonnes, pending confirmation by geological studies.

The first is an 80% interest in PT Chaya Meratus Primecoal, an Indonesian company holding exclusive exploration and development rights for up to 6,000 hectares in the Tanjung Area Basin of south east Kalimantan.

The second is an exploration and production license covering 1,300 hectares in the East Kalimantan province through an agreement with the concession holder, PT Integra Prime Coal.

The company also has an extensive pipeline of additional projects under review for potential licensing or acquisition. East Kalimantan has the distinction of being at the epicenter of thermal coal mining and exports from Indonesia.

For context, most of the country's coal mines, including the largest, are located in East and South Kalimantan and two of the world's largest coal mining companies, BUMI and Adaro Resources operate in the region. Our concessions show extensive coal formations at the surface, and preliminary field work by our field geologists give us a high level of confidence in the resource estimates previously mentioned.

Currently our projects do not have JORC-compliant resource estimates, which is one of the standards used in the mining industry to assure shareholders and other stakeholders that the resources a company says they have are in fact present.

"We are actively engaged in securing JORC estimates for both of our concessions, and will do so for all additional concessions we acquire. This will significantly increase our company's attractiveness to institutional investors," Borneo said.

(sourced:Theindonesiatoday.com)