Cokal Limited is making good progress with construction on the BBM Anak Coal Project in Central Kalimantan, Indonesia. BBM Anak forms part of the wider Bumi Barito Mineral (BBM) project and has been targeted for early production owing to the low-risk of mining the high calorific value, high volatility PCI coal.
The BBM Anak coal is suitable for blending with lower quality coals and will be sold to local coal companies, providing Cokal with attractive cashflows.
The ASX-listed company has recently raised A$700,000 via a private placement to sophisticated and professional investors.
The funds raised will be used for working capital as the flagship BBM project advances towards initial coal production, which is expected to be achieved in Q3 of 2017.
Cokal anticipates that the capital raised will be the final requirement for funding prior to initial production from the BBM Anak area.
On June 12, the first of three LCT (Landing Craft Transport) barges carrying mining equipment arrived at Krajan, which is the base camp for BBM. Dump trucks, excavators and dozers were unloaded and immediately commenced construction of the centreline for the haul road from the barge-loading port to the stockpile area.
This initial construction was completed during the weekend of July 15 and 16 and the equipment then commenced clearing the centreline from the stockpile area to the mine site and the Krajan camp.
All land acquisitions required to implement production at BBM Anak have been completed. All parties involved conducted the transactions in a co-operative manner and Cokal is pleased with the outcome.
Cokal has all of the key components required for the construction of, and production from, the BBM Anak mine as well as the approvals for the logistics chain to deliver the coal to domestic customers.
The company has received interest from numerous customers who are seeking to purchase this particular coal product.
Chairman Domenic Martino said, Cokal is very pleased with the outcome of the capital raising and the strong support shown by investors. The timing is perfect as it coincides with Cokals unique value proposition as a near-term, low cost producer of metallurgical coal, with two fully-funded coal mine developments.
We are delighted to have been able to introduce a number of new mining sector institutional investors onto the Cokal share register through this capital raising process and we look forward to their long-term support and commitment.