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 TSX.V; KLG
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Company Statement
Kalimantan Gold Corporation Limited ("KLG") is an AIM and TSX-V listed mining junior, focused on promising coal, gold and copper prospects in Kalimantan, Indonesia.
In East Kalimantan, KLG has been exploring a number of near production thermal coal prospects, completing a 4,600 meter drill programme with the aim of attracting investment from a major coal buyer prior to mining.
Also in East Kalimantan, the company has completed a 9,595 metre drill programme at its 100%-owned Jelai prospect which has the potential to yield a major epithermal gold deposit. The programme has produced some extremely promising drill results to date and the company is currently evaluating options for developing the project.
In Central Kalimantan, KLG has spent more than 10 years exploring its KSK copper gold project, uncovering the potential for a world-class copper porphyry deposit and attracting interest from a number of major companies.
KLG actively supports the Yayasan Tambuhak Sinta (YTS) Foundation which has an outstanding track record in community and social projects close to the exploration areas.
Kalimantan Gold's objective is the responsible and profitable development of its copper, gold and coal prospects in order to realize long term value for its shareholders.
Current Operations
Overview
We have been been actively exploring in Indonesia since 1996 and have considerable experience of the country's geology, its people and the decision making structure. The Company is focused on promising gold, coal and copper projects in the Kalimantan province which is both highly prospective and underexplored. We currently have exploration rights over two distinct areas, East Kalimantan where we are drilling to define an inferred epithermal gold resource at Jelai and and Central Kalimantan where we have a KSK Contract of Work (CoW) on a number of copper-gold porphyry prospects. The Company has also signed an Option Agreement on eleven coal prospects and we are currently carrying out survey work and drilling on the prospects with the objective of identifying one or more economic deposits to support a new coal producing operation.
Jelai Gold Project
An epithermal gold prospect in East Kalimantan
Current activity
KGC has been undertaking a major drill program at its 100%-owned Jelai epithermal gold property in East Kalimantan where the company has successfully tracked the results of the previous incumbent Indochina Goldfields (now Ivanhoe Mines) and is now achieving some promising results of its own.
The 5,000 hectare exploration concession contains 11 known anomalous gold prospects, only one of which, the Mewet vein system, was drilled by Ivanhoe. While Ivanhoe drilled only 15% of the cumulative 5km strike length within two individual veins of the Mewet vein system, the company has now confirmed the presence of some high grade gold mineralization in four individual veins at Mewet.
KGC's current drill program includes hole 26 which encountered 5.6 grams per tonne ("g/t") gold over an interval of 5.6 metres including 17.33 g/t gold over 1.20 metres and hole 27 which encountered 2.15 g/t gold over an interval of 5.95 metres including 10.30 g/t gold over 0.65 metres in the Sembawang vein; all within 47 metres from surface.
Geological background
Geology at Jelai fits the model found in similar magmastic arcs world-wide, which predicts that high grade ore shoots are very likely in this type of deposit. The concession is a low-sulphidation epithermal precious metal system consisting of at least seven major veins and numerous subsidiary veins with a cumulative strike length of more than five kilometres.
Drilling to date has discovered at least five potential ore shoots within the restricted strike length that have been explored. Interpretation of mineral textures in the veins and comparison with models for low-sulphidation epithermal systems suggests that the current level of exposure is near the top of the precious metal zone. Previous drilling on the Mewet shoot indicates that the vein becomes thicker with depth and that the mineralization extends over at least 200 metres vertically. Mineral textures are logged in the veins to determine the controls on ore shoot development as a further predictive tool for exploration. The emphasis on drilling will shift to assessing the size and grade of the known mineralized zones using deeper drilling up to 300m. This will take the project to at least inferred resource status while the team at Jelai continues to systematically drill shallow holes outwards along strike from these zones in an attempt to locate further ore shoots. 'size & grade' will be determined using deeper drilling up to 300m and will commence shortly.
Jelai vein structure
Eleven major veins and numerous vein splays were identified by ICG in the Mewet vein systems. The main veins are: Mewet, Nyabi-Adau, Sembawang, Lipan, Tigalima and Taman. These veins vary in length from about 250 metres to greater than 1,000 metres and have an average width of between 2 and 8 metres. The veins show complex textural characteristics, including prominent banding and brecciation, which reflect multiple stages of silica, adularia and carbonate deposition and preservation at relatively high levels withi a classic epithermal gold environment.
Coal prospects
The Indonesian coal boom
Over the past five years Indonesia's export coal production has soared from about 55 million tonnes per annum to around 150Mtpa. It is predicted that Indonesian coal production will double by 2017 to at least 400 million tonnes, most of which will be exported.
Kalimantan is already home to approximately 20 large scale coal mines, the biggest of which is Kaltim Prima Coal, owned by Bumi Resources, which produces approximately 35Mtpa of coal from a current resource of 4.5Bt. Notable new discoveries in recent times include the Pakar discovery in East Kutai, which has a substantial JORC-compliant resource of 3.3 billion tonnes of thermal coal. Churchill Mining is also active in the region having acquired a 75% interest in the East Kutai Coal Project where it has already established a sizeable resource.
Current KLG activity
KLG is currently carrying out due diligence on five coal concessions (KP's) offering exploration and development potential in East Kalimantan. KLG has signed an Option Agreement to acquire a 75% in the concessions and is actively working with partners to acquire interests in additional concessions in the area.
KGC signed an Option Agreement in April 2008 to acquire a 75% stake in the concessions and establish a presence in Indonesia's rapidly growing coal industry. East Kalimantan is responsible for around 60% of Indonesia's coal production and all the concessions are close to existing coal mining operations in what has become a world hot spot for coal. The six month due diligence period will include a minimum of 3,000 metres of drilling to assess the potential for coal reserves.
As part of the due diligence, KLG is working closely with the Indonesian consulting group PT GMT Indonesia and the Mesra Group. GMT manages a number of coal exploration projects in East Kalimantan and has extensive experience in bulk commodity exploration, consulting and project management. GMT is contracted to produce a detailed report on each of the concessions. The Mesra Group is an established operator in the coal market, having identified and sold substantial coal projects to Korean, Indian and Middle Eastern companies.
KSK Contract of Work - Central Kalimantan
Current Status
KSK is a 941 sq km 6th generation Contract of Work comprising a total of 38 mineral prospects. Of the 38, KGC has identified several of which are acknowledged to hold potential world class copper-gold porphyry deposits.
Dr Peter Pollard was asked to produce an independent report on KSK following the completion of a drill programme by Oxiana Ltd in December 2007 and it's subsequent decision not to exercise its joint venture option after spending US$2.5 million on a limited program.
Dr Pollard's report highlighted the "untested potential" in several areas which is currently attracting interest from a number of potential joint venture partners. Dr Pollard's report states that while several parts of prospects were downgraded by Oxiana's work, there are a number of untested targets at the KSK Beruang prospect where previous drilling results include 167 meters @ 0.59% copper and at Baroi where previous results include 83 meters @ 2.64% copper. As a result the company believes that there are still valid known targets to be tested within the main KSK prospect areas. KGC is seeking a partner that will commit the funds necessary to do a thorough program, which will cost around $US 10 million.
Geographical Spread
Board of Directors and Key Management
| Directors | |
| Peter Bojtos | Non-executive Chairman |
| Faldi Ismail | Non-executive Chairman |
| Rahman Connelly | Deputy Chairman,Chief Executive |
| Doris Meyer C.G.A. | Chief Financial Officer and Director |
| Peter Bojtos | Director |
| Senior Management | |
| Rahman Connelly | Deputy Chairman, Chief Executive Officer |
| Doris Meyer | Chief Financial Officer and Director |
| Mansur Geiger | Vice President Exploration |
| Bardolf Paul | Community and Regional Development Manager |
| Dr Peter Pollard | Technical Adviser |
| Nick Cottam | Corporate Relations Manager |
| Gerald Cheyne | Director Corporate Development |
Company AddressUnit 1, 15782 Marine Drive
|
Additional Address/Key ContactNick Cottam |
CapitalIssued and outstanding: 63,955,117
|
Annual General MeetingMay | Year End31 December |
Nominated BrokersKeith, Bayley, Rogers & Co. Limited | Nominated AdvisorsRFC Corporate Finance Limited |
Major Shareholders
| Directors & Management | 8.5% |
| Kalimantan Investment Corporation | 18.4% |
| Retail & Institutional Shareholders | 73.1% |
Related News
27/08/09 - Kalimantan Gold Looks Poised For A Boost From Developments On Three Advanced Projects In Indonesia21/04/09 - Kalimantan Gold Aims To Turn Profits From Coal Into Exploration For Gold
07/05/08 - Coal Is The New Black Gold For Kalimantan Gold
Most Recent Statement
17/03/10 - Kalimantan Gold Corporation Limited: Status Report03/12/09 - Agreement to Sell IBP coal concession reached
30/11/09 - Kalimantan's Third Quarter Report
26/11/09 - Kalimantan Gold completes private placement
25/11/09 - Kalimantan Gold Plans Private Placement
11/11/09 - Study Confirms Potential for a Major Copper Porphyry Deposit at the KSK Project