SYDNEY (Yosefardi) – Kangaroo Resources Limited reported is updating and renewing mining exploration licenses and permits and obtaining other necessary permits and approvals to enable mining operations to commence at PAKAR North in 2016.
Processing of applications by the various authorities proved to be slower than expected during Q3 mainly due to the Presidential Elections and associated changes in government ministries and departments. A new Cabinet was appointed in October.
New Infrastructure now connects BAYAN’s TABANG projects and the Company’s PAKAR projects to a new port at Senyiur on the Kedang Kepala river. This Capex project has been fully funded by BAYAN.
Construction of the new infrastructure comprising a new 69Km haul road and river port facility has been ongoing throughout 2014. Trial cargoes have already been carried out and the initial facilities are scheduled to be fully operational and dispatching TABANG coal in early 2015.
Commercial arrangements are being negotiated with Bayan to ensure proportion of the overall infrastructure capacity will be allocated for PAKAR coal scheduled to come on stream during 2016.
For Mamahak Coal Project, labor and equipment resources have been significantly reduced in order to minimize monthly costs. 67,300 tonnes of product coal (and 4,200 tonnes of bedding coal) remain in stockpile on site and will be barged to BCT and sold as soon as river levels normalize and allow barging to recommence.
Once the coal has been barged and sold, further reductions to project debt and site costs will be made. Production and exploration at MCM will remain suspended until coal markets improve significantly.
For Graha Panca Karsa (GPK) Coal Project, forestry land usage permit is expected to be issued shortly. The Company is preparing a budget and work plan to carry out a pre-production drilling program to optimize initial mining areas within the initial permitted forestry usage area.
Funding for this initial work program will be through a loan facility from Kangaroo Resources
backed by Bayan Group.
Discussions have been held with neighbouring operational mines with a view to sharing haul road and port infrastructure facilities to reduce capex outlays and construction delays.
Commencement of production operations at GPK will be timed to coincide with an improvement in coal markets.
Options are being reviewed to address foreign investment restrictions that would apply when the Company elects to transfer its commercial rights into equity.