5,770 PT. Bayan Resources Tbk - Prospectus

‰ a significant number of drillholes have been “touch” cored for coal quality analysis, and ‰ all drillhole locations have been surveyed. The proposed initial pit areas have been subject to detailed drilling at 50-200m spacing while the remainder of the potential open pit area has been largely subject to semi-detailed drilling approximately 250-500m spacing. Drilling has concentrated on the major seams with only limited drill data for a number of minor seams and sub-seams. Geophysical logging which provides a high degree of certainty of data accuracy has been conducted at PIK on some drill lines. The typical suite of geophysical logs includes natural gamma, in situ rock density and calliper borehole diameter. The data obtained includes seam depth and thickness, seam partings, indicative seam quality ash content, seam correlations and fault interpretation. Drillhole depths are typically shallow up to 60m depth and have been drilled “open hole” i.e. non-cored with “touch” coring of intersected coal seams in many holes. This methodology is acceptable in terms of providing reliable seam data, subject to the following observations: ‰ open hole drilling supplemented by geophysical logging gives a high level of confidence for Coal Resource estimation and this methodology is widely applied in the coal industry, ‰ a significant number of drillholes at PIK have not been geophysically logged, ‰ open hole data supplemented by “touch” coring for coal analyses is widely used in the Indonesian coal industry, and this methodology is generally acceptable when core recoveries exceed 90, ‰ some coal losses do occur at the seam roof and this can be considered a material issue in the interpretation of thin seams Note: MMC has considered this in resource categorisation, see Section 4.5, and ‰ PIK has a large coal quality database from “touch” coring drillholes, however not all coal quality data has been included in the current geological model and the number of analyses available outside of the major seams in the initial pit areas is limited. In summary, the PIK deposit has been subject to close-spaced shallow open hole drilling with “touch” coring concentrated on a number of major coal seams. However due to the relatively shallow drilling and lack of deeper down dip confirmation of seam continuity, MMC is of the opinion that the level of confidence of data is such that the Coal Resource estimates can only be considered to be of maximum Indicated status. Ongoing detailed drilling by PIK, including deep hole drilling, additional coal quality data and geophysical logging is expected to raise the level of confidence of Coal Resource estimates in future reports. Survey Detailed topographic survey has been conducted over study area and all drillholes have been surveyed by Total Station. Geological Modelling All data including drill logs reconciled against geophysical logs where available, coal quality and drillhole survey data have been input into an electronic database. Using Mincom “Stratmodel” mining computer software, Bayan geologists have created a 3-D “surface” model of the deposit. A surface model is built up from individual layers including the topographic surface, weathering surface, seam roofs and floors. Mincom software is capable of modelling seam splits and faults. Model Conversion and Resource Estimation The Mincom model was provided to MMC in “gridded” model format which was converted to Minex computer software format. The Minex model volume output coal and waste was validated against the original Mincom model and found to have a high degree of accuracy. MMC Coal Resource estimates were derived from the Minex model output. A-97