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Gary Cochrane - Bounty Mining
- 1. Indonesian Coking Coal Exports - A Threat to Australia? Bounty Mining Ltd Informa Brisbane 2017 Gary Cochrane and Keith Whitchurch
- 3. Indonesian Coking Coal Companies • Mixture of Australian, Indonesian, Japanese, Chinese investors; • Private and listed companies, on Jakarta, Singapore and Australian stock exchanges; • Large and small operators; • Potential to increase coking exports from 2.2 mtpa in 2016 to at least 10 mtpa in 2020.
- 4. Advantages • Low Indonesia Rupiah; • Strong GDP growth and strong economy; • Ability to commence with low capex utilising small trucks and excavators; • Very low ash coal, low sulphur; • Direct shipping quality; • Generally good CSN and fluidity; • Low stripping ratios;
- 5. Disadvantages • Multiple thin seams of coal and interburden; • Can be steeply dipping; • Variability of quality within seams and areas; • Long haul distances to the river; • Long barging distances to the ocean; • Seasonal constraints with low water levels in the dry season impacting barging; • High VM, low fixed carbon coal, low rank.
- 6. Major Players • Adaro Metcoal Companies (ex Indomet, 1.27 bt) Murawi and other projects; • Cokal Coal (ASX:CKA), BBM project; • Itochu investments (MGM 23.5%, SMM 19.9%) • Marunda Graha Minerals; • Suprabari Mapanindo Minerals; • Zamia Metals (ASX:ZGM), PT Borneo Coal; • Kangaroo Resources (ASX:KRL), Mamahak Coal; • Project Orion, large coking coal and anthracite reserves.
- 8. Adaro Metcoal • Very large Indonesian coal company producing up to 60 mtpa of thermal and coking coal; • Acquired Indomet of BHP in 2016 and now plans to commence production in 2017 increasing to 5 mtpa of coking coal by 2020; • 1.27 billion tonnes of resources; • Requires trucking of up to 40km to the river.
- 9. Adaro Metcoal - Central Kalimantan
- 10. Cokal - BBM • Bumi Barito Mineral Project. • High quality metallurgical coal project in Indonesia; • 266Mt JORC Measured, Indicated & Inferred Resource– 90% Coking Coal and 10% PCI; • Low ash, low sulphur and high calorific value (Direct Shipping); • Commencing production in 2018 at 1.5 mtpa with potential to expand to > 3mtpa
- 11. Logistics and Transport - BBM Coal to be transported in three phases, accounting for ~ 774km from the mine site to the Java Sea •55km haul road from mine to the Barito River •500km down the Barito River to the Intermediate Stockpile Port at Kelanis •Ocean-going barges to transport coal ~ 200km to the open sea anchorage at Taboneo in the Java Sea •Coal to be trans-shipped to an ocean going vessel for the customer
- 12. Junior and Private Miners • Asmin Koalindo Tuhup – private operating mine, producing up to 1 mtpa; • Kangaroo Resources – Mamahak mine currently on care and maintenance until coking coal prices improve, capacity of up to 0.5 mtpa; • Marunda Graha Minerals – private operating JV with Itochu, producing up to 1.7 mtpa; • Multi Tambagjaya Utama – private operating mine, producing up to 1.2 mtpa; • Suprabari Mapanindo Mineral – private oprerating JV with Itochu, producing up to 3.3 mtpa
- 13. Zamia (ASX:ZGM) – BPCI • ASX gold junior in process of reverse takeover for Borneo Prima Coal (RTO into Zamia) • No production and requires small capital raising to complete the deal and to move to production of around 1.5 mtpa.
- 14. Project Orion • Private company looking to raise funds to develop large scale coking coal mine; • Initial production commencing in 2018 and growing to at least 5 mtpa by 2020 but will require significant capital expenditure; • Potential to truck to the Mahakam River on the longer term once major haul road constructed.