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 AIM; CHL
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Company Statement
Churchill Mining PLC ("Churchill" or "the Company") listed on the Alternative Investment Market (AIM) of the London Stock Exchange in April 2005 and is committed to growing shareholder value by becoming a leading minerals explorer and future miner at a time of accelerating commodities demand.
Churchill's business plan is to leverage off the strong growth in demand currently being experienced in China and India for commodities which are used as feedstock in the ever expanding energy industries.
Current Operations
East Kutai Thermal Coal Project (Churchill 75%)
In May 2009 Churchill Mining announced that the global resource at the East Kutai Coal Project (“EKCP”) had more than doubled again to 3.18 billion tonnes of thermal coal. Included in this global resource was the previously reported JORC compliant resource of 1.4 billion tonnes. The balance is expected to be upgraded into JORC compliant categories shortly.
Churchill has now defined a coal system 18 kilometres long and approximately 3 kilometres wide. To date only 30% of the EKCP area has been drilled and the existing resource remains open along strike.
The latest resource update was derived from a total cumulative drilling of 40,900 metres, including 14,200 metres of open hole and 26,700 metres coring in 287 drill hole locations. The drilling focused in the north-eastern areas of the Investama Resources block and the north-western areas of the Ridlatama Tambang Mineral block.
Coal quality in the latest round of drilling is similar to previous drill samples with the coal defined as medium calorific, with low sulphur and low ash content. Churchill believes, given the potential world-class size of the EKCP resource, that the project now has the scale to be of strategic value to major Asian power groups – particularly those in Indonesia, India and China.
Churchill Mining also confirmed that it had recently obtained its approvals and mining licenses from the Indonesian Government.
Due to the large size of the deposit, Churchill is now focusing its mine and infrastructure planning to create a bulk mining operation producing up to 20 million tonnes of coal per annum. The Company has also set a new JORC reserve target of 500 million tonnes to support this production level; the original target was 150 million tonnes.
To date the Company has completed many of the preliminary technical and Indonesian statutory procedural requirements to ensure mining can go ahead. This technical build-up will continue for the balance of 2009 so that the EKCP is ready for project development financing and/or joint venture partnership next year. The Company recently raised another GBP 5 million with sophisticated investors to help finish this build-up.
Sendawar – CBM
The Sendawar CBM project in Kalimantan, Indonesia, covers more than 800 square kilometres of prospective ground and lies in close proximity to two operating open-cut coal mines. The project is located approximately 50 km from the Mahakam River.
During Churchill’s coal exploration programme, data collected during geophysical and resistivity work, along with data collected from previous oil and gas exploration in the area, indicated that the area was highly prospective for Coal Bed Methane. Churchill (70% of the CBM project) along with its Indonesian partner RMU (30%) were granted Indonesia’s first CBM JEA license in September 2007. The CBM project has the potential to host Gas-in-Place of 5.6 trillion cubic feet. Churchill is currently conducting further studies on the CBM project before starting detailed field work.
AUGI has recently been recognised by BPmigas, the Indonesian Government authority responsible for the CBM regulations, as the only industry body permitted an input into the drafting of the CBM regulations.
South Woodie Woodie
Given Churchill's increasing focus on its Indonesian coal and coal bed methane projects, in 2007, the Company decided to divest an 80% interest in the project to Australian company Spitfire Resources Limited ("Spitfire"). Spitfire has the option to purchase the remaining 20% equity in the project for AUD$3 million after spending AUD$1.5 million on exploration.
Spitfire successfully listed on the Australian Securities Exchange ("ASX") via a A$6 million Initial Public Offering (IPO). The transaction has allowed Churchill to focus purely on its East Kutai and Sendawar Projects in Indonesia while retaining a substantial holding stake in Spitfire.
The consideration to Churchill for the acquisition of the 80% interest in the South Woodie Woodie Project was 25 million new ordinary shares in Spitfire, making Churchill Spitfire's largest shareholder (28.8%).
Churchill is also entitled to retain a manganese production royalty should a mine be developed. The production royalty is price indexed so as to ensure Churchill retains substantial leverage to any future mining cash flow.
www.spitfireresources.com
Geographical Spread
Indonesia
Board of Directors and Key Management
| David Quinlivan | Chairman |
| Paul Mazak | Managing Director |
| Faroek Basrewan | Non-Executive Director |
| Jan Castro | Non-Executive Director |
Company AddressSuite 1, 346 Barker Road
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Additional Address/Key ContactUK Registered Office: |
Capital80,413,514 fully paid ordinary shares |
Year End30 June |
Nominated BrokersMidas Investment Management Service | Nominated AdvisorsAstaire Securities Plc |
Major Shareholders
| Vidacos Nominees Ltd | 25,706,326 | 31.96% |
| Lynchwood Nominees Ltd | 6,350,000 | 7.90% |
| Goldman Sachs Securities Nominees Ltd | 3,584,102 | 4.46% |
| Dartington Portfolio Nominees Limited | 3,104,900 | 3.86% |
| Hanover Nominees Ltd | 2,994,744 | 3.72% |
| BBHISL Nominees Ltd | 2,850,000 | 3.54% |
Related News
26/08/09 - Churchill Mining May Be On The Verge Of Announcing A Reserve Of A Billion Tonnes Of Coal At East Kutai27/05/09 - Churchill Mining Looks Well Set Up To Bring The East Kutai Coal Project Into Production Within The Next Couple Of Years
15/12/08 - Churchill Mining Should Be Producing Coal From East Kutai By The End Of Next Year
13/11/08 - Churchill Mining Explores The River Route For East Kutai’s Initial 3 Million Tonnes Of Thermal Coal Per Year
02/10/08 - Churchill Mining Joins The Billion Tonne Club On East Kutai In Indonesia
08/04/08 - Churchill Mining Makes The Most Of Fabulous Times In The Coal Market
Most Recent Statement
24/02/10 - Project Update13/01/10 - MM - Cancellation Notice
15/12/09 - EAST KUTAI COAL PROJECT
15/12/09 - Annual Information Update
11/12/09 - CHURCHILL APPOINTS PALA INVESTMENTS & PRICEWATERHOUSECOOPERS INDONESIA AS
26/10/09 - INITIAL MINING RESERVE STATEMENT AT EKCP