A 4600 metre drilling program on Kalimantan Gold’s PT Indobara Pratama (IBP) coal project in Indonesia has identified two thick seams.

One seam is between 1-6 metres thick while the other is between 8 and 13 metres. The flat lying to shallow dipping nature of the seams indicates a low overburden ratio of around 2:1 (2 metres of overburden per 1 metre of coal).

The IBP coal concession is permitted for production and has the potential to be an open-cut coal mine. Work completed on the concession indicates a potential deposit of between 100 and 120 million tonnes of between 4800 and 5000 kcal/kg coal (air dried basis). The coal has a low ash and low sulphur content.

Kalimantan Gold’s CEO Rahman Connelly says, “The program confirms the validity of data provided by the owners. It also indicates that the area has substantial unexplored potential, given that the focus of our program was on just 418 hectares of the concession's 2700 hectares. The thick seams and low overburden ratio also suggest the potential for relatively low mining costs.”

The company is in active discussions with several power station operators regarding coal off-take and project equity participation, given that the specifications of IBP coal closely matches the requirements of new power stations in India and Indonesia .

There is an excellent 20km road from mine-site to jetty, for which land has recently been acquired by IBP. The distance by barge from jetty site to the Balikpapan Coal Terminal is 304km.

The latest program involved the drilling of 58 holes for 4610 metres with 50 holes drilled on 250 metre spacings within an area of 418 hectares and 8 on 1000 metre spacings within an area if 949 hectares.

Most holes were drilled to 60 metres, with a range of 12 to 81 metres. 32 holes were redrilled to ensure high core recovery.

The potential exists to substantially increase the mineralized area within the remaining 1333 hectares of the exploitation area and an adjoining 2285 hectare exploration area

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