11th May 2006 11:51
Churchill Mining plc11 May 2006 11 May 2006 CHURCHILL MINING PLC ("Churchill" or "the Company") Sendawar Coal Project, Indonesia - Update The directors of Churchill Mining Plc (AIM: CHL) are pleased to announce thatgeneral survey exploration work has begun at its Sendawar coal project inKalimantan, Indonesia. Highlights: • Regional exploration office established at the Sendawar Project • First field team of geologists at site • Initial test drilling to begin at the end of July The Company's first field crew is now at site and has commenced mapping coaloutcrops discovered on the north eastern part of its tenement position. Thissurvey team will be joined by two other teams in coming weeks. These teams willreport to and be run out of a newly-established Company office in Sendawar, thelocal capital and largest population centre close to the Project. The Company has also begun community relations work as pre-planning begins forinitial test core and open-hole drilling. Churchill plans to start initial testdrilling at the end of July and will shortly tender out a contract for the firstphases of this programme. The Company has also started the process of hiringskilled and local labour to support the programme. Churchill's Sendawar project covers more than 1,000 square kilometres ofprospective coal ground and lies in close proximity to two operating open-cutmines: Thai miner Banpu's newly-commissioned Trubaindo operation, which will beshortly producing at a rate of approximately 6 million tonnes per annum ("tpa");and the privately-owned Gunung Bayan mine which has been operating since 1998and produces approximately 3.4 million tpa. Coal from these mines istransported by barge via the Mahakam River to the port of Samarinda. TheSendawar project is located approximately 50km from the Mahakam River. Churchill's short term strategy is to delineate a small reserve on the Projectso that it can begin trial mining with a view to producing early term cash-flow. Any such revenues from this mining programme will then be redirected back intothe Project to work towards defining a large resource base that will support amulti-million tonne mining operation, such as those established by its nearbyneighbours. ENDS Enquiries: Churchill Mining PLC Corporate Synergy Plc Parkgreen CommunicationsPaul G Mazak / James T Hamilton Olly Cairns Brendan McNamara+61 (0) 89 388 0377 +44 (0) 20 7448 4400 +44 (0) 20 7493 [email protected]@churchillmining.com Notes to editors Background to Indonesia and Sendawar Indonesia has approximately 7 billion tonnes of measured coal reserves and 33billion tonnes of measured and indicated resources (source: Barlow Jonker). Themajority of coal produced in Indonesia comes from Kalimantan. Typically, coal mining operations in Kalimantan are either located near the seaor along major river systems. The Sendawar project is located within closeproximity to the Mahakam river via which coal is shipped to the port ofSamarinda. Coal barges used on the Mahakam most commonly range in size from6,000-8,000 tonnes but more recently larger sizes of 10,000-12,000 tonnes havebeen employed. The barges are used to deliver coal to larger vessels unable toload in shallow coastal waters. Indonesian coal production and export sales have surged in recent years. In2004 total coal production grew by 14.2% year-on-year to 136.2 million tonnes(source: Barlow Jonker). Tight supply in world thermal coal markets coupled with China's flat coal exportperformance continues to benefit Indonesian producers. Churchill's South Woodie Woodie Manganese Project South Woodie Woodie has three granted exploration licences. These licencescover a total area of approximately 490 km2, in the highly prospective EastPilbara Craton of Western Australia, an area renowned for its proliferation ofmanganese deposits. During 2006, the Company intends to begin a campaign of airborne and groundgeophysics to look at mineral bearing structures "under cover" in its Licencearea. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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