14th Oct 2005 14:24
Asia Energy PLC14 October 2005 Asia Energy PLC ("Asia Energy" or "The Company") Asia Energy announces coal quality for the Phulbari Coal Mine Asia Energy announces the latest coal quality test results from the PhulbariCoal Mine. These results are based on a comprehensive analysis of allexploration slim-core samples and the first of the two Large Diameter coresamples specifically extracted to determine representative coal quality acrossthe major coal seams. Testing and analysis has been undertaken by ACIRL Ltd in Australia under thesupervision of Asia Energy's coal evaluation consultant, QCC Resources Pty Ltd.QCC has determined that through conventional, efficient coal washing andpreparation processes, Phulbari 'Run of Mine' coal is capable of yielding a widerange of coal products with differing levels of ash and energy. In its reportpresented to Asia Energy this week, QCC has defined the parameters for threeproduct categories - Export Thermal Coal (ETC), Low Ash Metallurgical Coal(LAMC) to be marketed as a Semi Soft Coking Coal (SSCC), and Domestic ThermalCoal (DTC). These products represent an optimum mix of clearly defined andinternationally recognizable coal types, which are highly suited to theinternational and domestic coal trade. The principal specifications for the targeted export coal products are detailedbelow. These are "Provisional" specifications based on testing and analysis todate and the mine plan schedule. The final "Typical" Product Specifications aresubject to the completion of tests on the second of the two Large Diameter coresamples and on combustion testing over the next two months. Phulbari Export Thermal Coal (ETC) Thermal Coal is primarily used in coal-fired power generation and in raisingheat for industrial processes such as cement clinker. The major coal qualityproperties used to price coal and determine efficient application in coal-firedpower plants and compliance with environmental standards are specific energy,moisture, ash, volatile matter, fixed carbon, ash chemistry, sulphur, andgrindability (the ease with which the coal can be reduced to a pulverized fuelfeed). Phulbari ETC is comparable in quality to major traded bituminous coal brandsfrom Australia, South Africa, Indonesia and China. Therefore, there are noanticipated technical barriers to export market entry. In terms of those characteristics that maximise combustion efficiency - highenergy, low moisture, low ash, manageable volatiles, high fixed carbon andbenign ash chemistry - Phulbari ETC ranks highly on all counts. Whilst withinmarket limits, Phulbari's sulphur is higher and grindability less favourablethan some competing coals. However, Phulbari's high energy compensates for thesefeatures in both commercial and technical evaluations. High energy thermal coalsare more efficient in power generation and industrial heat-raising as theyreduce the quantity of coal needed to produce a unit of electricity or heat and,in turn, reduce emissions on a per unit basis. Phulbari ETC is, therefore, a premium product, which is expected to bepositioned at the high end of internationally traded thermal coals. Phulbari Low Ash Metallurgical Coal (LAMC) Metallurgical coals are mainly used in the production of coke for blast furnaceinput in the integrated iron and steel industry worldwide. Semi-soft Coking Coal(SSCC) is blended with higher priced Hard Coking Coal to make cost effectivecoke. Phulbari's LAMC specification has many similarities with Rio Tinto'sHunter Valley SSCC brand, and to Chinese export SSCC brands. Like these brands,Phulbari only has moderate coking characteristics and cannot be used by itselfto make coke, but is suitable as a blend component. Phulbari LAMC's key quality positives are its low ash and low to mid-rangephosphorus. The ash level of less than 7.0% (air dried basis) are expected to bevery attractive to coke-makers, who generally receive Hard Coking Coal in an ashrange of 6% to 10%, and premium grade and standard (non-premium) grades of SSCCin an ash range of 4% to 8.5% and 8.5% to 11% respectively. Imported SSCC's withlow ash and low phosphorus properties similar to Phulbari are particularlypreferred and valued by the Indian iron and steel industry, mainly because theyoffset high ash in local coals, and higher phosphorus levels in locally suppliediron ore. It is anticipated that Phulbari LAMC will have a major freightadvantage to the Indian market over competing suppliers. Phulbari Domestic Thermal Coal (DTC) As an outcome of the coal washing and preparation process, DTC can be producedwith varying levels of ash, from 19% up to 33% (ad) and consequent reducedenergy content, and with a sulphur content of around 0.9% (ad). In otherrespects, the DTC is similar to Phulbari ETC. Phulbari DTC is expected to be an ideal fuel for additional coal-firedelectricity generating capacity in Bangladesh to help meet the country's growingpower demand. Asia Energy has proposed a 500 MW plant to the Government ofBangladesh, which will consume around 1.5 Mtpa of higher ash coal and addsignificantly to the strength and market diversity of the Phulbari Project. A significant opportunity exists to supply coal to the Bangladesh brick-makingindustry, which has been estimated to consume at least 2.3 Mtpa of coal importedfrom India. Phulbari DTC has much lower sulphur (around 0.9% as received basis)and other contaminants than the Indian coal, which contains up to 4.0% sulphur.Using Phulbari coal will not only improve the environment around brickworks butis anticipated to enhance the Balance of Trade with India by reducing coalimports. --------------------------------------------------------------------------------------------- Phulbari Export Coal Product Specifications Provisional---------------------------------------------------------------------------------------------Typical Unit of Analysis Low Ash ExportSpecification Measurement Basis Metallurgical Thermal Coal Coal LAMC ETC---------------------------------------------------------------------------------------------Total moisture % ar 10.0 8.5Proximate analysis % ad Moisture 2.8 2.4 Ash 6.8 12.0 Volatile 33.7 31.4 matter Fixed 56.7 54.2 carbonTotal sulphur % ad 0.75 0.80Chlorine % ad 0.02 0.02Phosphorus % 0.03 0.04Hardgrove grindabilityindex 45 43Crucible swelling N(o) 4 1Top Size mm 50 50Specific energy Gross: kcal/kg ad 7420 6930 Net: kcal/kg ar 6580 6240Nitrogen % daf 1.8 1.8Analysis of ash % SiO2 47 48 Al2O3 37 40 Fe2O3 6.5 5.3 CaO 0.9 0.4 MgO 0.2 0.2 Na2O 0.1 0.1 K2O 0.9 0.7 TiO2 5.6 3.4 Mn3O4 0.01 0.01 P2O5 1.10 0.73 SO3 0.1 0.1Ash fusibility Hemisphere degreesC, red. atm 1550 >1600 ar: as received ad: air dried daf: dry ash free--------------------------------------------------------------------------------------------- 14 October 2005 For further information please contact: Michael Frayne, Joint Managing Director Justine Howarth, Cathy [email protected] Parkgreen CommunicationsDavid Lenigas, Joint Managing Director Tel: +44 (0) 20 7493 [email protected] [email protected] Energy PLC [email protected]: +44 (0) 20 7079 1798, Fax: +44 (0) 20 7491 [email protected]; www.asia-energy.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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