Churchill Mining Acquires Land for Port Facility at East Kutai Coal Project
Proactive Investors USA & Canada, Thursday, 16 December 2010

Churchill Mining (LON:CHL) has completed the purchase of the land to be used as the site of the future port facility for the shipment of coal from the East Kutai project in Indonesia.

The port stockyard will have four stockpiles with a total storage capacity of 852,000 tonnes.

The wharf facility will be equipped with two dedicated ship loaders capable of handling 30 million tonnes per annum (Mtpa) of coal.

The wharf facility will handle shipping from Handymax to Capesize 210,000 DWT vessels.

In September this year, Churchill received internal sign-off on the port site from the Department of Transportation, initiating the land acquisition process.

The location of the port facility is a key component for the direct access of exporting thermal coal to the international markets, said the company.

“We believe that the port location is the best available site within the region, and are proud that our land acquisition team successfully completed the acquisition of this site in rapid time,” said managing director of Churchill Mining Paul Mazak.

The wharf facility will handle shipping from Handymax to Capesize 210,000 DWT vessels.

Broker Northland Capital Partners said that the stockyard represents a significant part of Churchill’s land acquisition programme.

“The company continues to build key components of the EKCP story as it works towards a JV, farm-out or sale.

“This demonstrates its ability to negotiate successfully with a number of disparate land owners and advances the project in terms of its marketability,” said Northland Capital.

Churchill has hired Credit Suisse to find what Mazak called a “big brother with deep pockets” to fund the development of the mine, which has a net present value of US$1.8 billion.

However, Churchill is keeping all of its options open and is still looking at possibly running East Kutai as a stand-alone project funded by equity and debt.

In September the company passed a major milestone when the eagerly awaited feasibility study confirmed East Kutai as a world class deposit with a JORC resource of 2.73 billion tonnes.
To ensure the success of the project Churchill has created an Indonesian advisory board that “guarantees access to all levels of industry and government” and it has negotiated an off-take deal with the state electricity company.

Churchill Mining’s strategy is to explore and develop mining projects that will leverage off the current appetite for raw commodities which are used in burgeoning steel and energy industries in growing economies.

Churchill’s main focus is its highly prospective thermal coal project located in the East Kutai Regency of Kalimantan, Indonesia. The Company has concluded an Exclusivity Agreement with PT Techno Coal Utama and the JORC compliant resource has been defined as 1.412 billion tonnes. Exploration and resource drilling continue along with scoping and pre-feasibility work.

Churchill has also acquired the Sendawar CBM Project in East Kalimantan, Indonesia, which is in an highly prospective area for coal bed methane. Additionally the Company acquired the South Woodie Woodie manganese project in Western Australia however due to the Company’s focus on Indonesia and the increased prospectivity of the project 80% was sold to Spitfire Resources Ltd.

Churchill's management continues to assess further opportunities in Australia and southern Asia to acquire quality projects in line with the Company's business plan.

Churchill is committed to growing shareholder value by becoming a leading minerals explorer and future miner.

• PTBA Targets 15% Production Increase
• Coal Imports May Increase 78% to China, India: Energy Markets