5.13 Summary Table of Model Data
Table 5.3 shows the geological models and modeling data used for the estimate. They have been
grouped together to provide an audit trail and to facilitate updates.
Table 5.4—Summary of Model Data
Tabang
Geological Model . . . . . . . . . . . . . . . . . . . . . . . . . . Tabang_Mod0807.grd
Quality Model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Tabang_Qual0907.grd
Optimiser Shell Selected . . . . . . . . . . . . . . . . . . . . . OPT 185
Pit Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Used OPT185 as
Pitshell ROM Coal In Pit Shell incl non JORC . . . . . . . . .
Mt Rom 432
Average Strip Ratio . . . . . . . . . . . . . . . . . . . . . . . . . bcmt ROM
3.2 Cut off ratio used for estimate . . . . . . . . . . . . . . . . .
bcmt ROM As below
Breakeven Strip Ratio . . . . . . . . . . . . . . . . . . . . . . . bcmt ROM
7.2 Highwall slopes . . . . . . . . . . . . . . . . . . . . . . . . . . . .
45.0 Lowwall slopes . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subcrop
A-79
PT. Perkasa Inakakerta PIK OPEN CUT COAL DEPOSIT
STATEMENT OF OPEN CUT COAL RESOURCES AND RESERVES AS AT 31
st
March 2008.
May 2008 Job 3318e_PIK_May
A-80
CONFIDENTIALITY AND
USE OF INTELLECTUAL PROPERTY
The information contained in this document is solely for the use of the client identified on the coversheet for the purpose for which it has been prepared.
This document, comprising figures, tables, appendices or any other inclusions remains the intellectual property of Minarco MineConsult. No party or individual shall copy, modify, or
publish the aforesaid material, or any part thereof, without written authorisation from Minarco MineConsult and full and proper acknowledgement of Minarco MineConsult’s contribution.
The title of this report and any associated work remains with Minarco MineConsult and does not pass to the client until all consideration has been paid in full.
A-81
EXECUTIVE SUMMARY
Minarco-MineConsult Pty Ltd MMC was commissioned by PT. Bayan Resources Bayan to complete an independent estimate hereafter, referred to as the “Statement” of the Open Cut Coal Resources and Reserves
of their mining tenement PT. Perkasa Inakakerta hereafter referred to as “PIK” in East Kalimantan, Indonesia. The Statement reports the Coal Resources and Reserves as at 31
st
March, 2008 and has been undertaken in compliance with the requirements of the reporting guidelines of the 2004 Joint Ore Reserves Committee of The
Australasian Institute of Mining and Metallurgy, Australasian Institute of Geoscientists and Minerals Council of Australia “The JORC Code”.
The PIK lease is located in the province of East Kalimantan, Indonesia, as shown on Figure 1. PIK is
one of six coal projects operated by Bayan and a separate Coal Resources and Reserves report is being prepared for each project.
A total of up to 99 coal seams have been identified in the PIK deposit and they range in thickness from 0.6-7.0 m. The coal ranges from lignite with total moisture TM 45 in the upper seams in the southeast to
sub-bituminous coal TM 27 in the lowermost seams in the northwest. The coal is low ash typically 4-6 air dried basis, adb and has highly variable sulphur content 0.5-3.6 adb. In situ Calorific Value CV ranges
from 3,490 to 5,220 kcalkg gross as received, gar and averages 4,740 kcalkg gar. The seams dip to the southeast at 20-45 degrees.
Mining commenced in April 2007 and to the end of March 2008 total production was 810,994 tonnes. The mining method can be described as “multi seam, moderate to steep dip open cut coal mining using truck and
shovel equipment in a haulback operation”. After an initial box cut, waste is to be hauled back into the mined out areas and the dump areas are then rehabilitated. Due to the variability in coal quality it is planned to operate a
number of pits for coal blending to produce a consistent coal product. The open cut operation is using hydraulic excavators and trucks to mine the coal and waste.
Facilities constructed include offices and a camp with associated road access, power and water supply. Infrastructure construction is completed and the mine has commenced production. Coal is trucked 17 km from
the pit to a barge loading port on the coast. The current jetty is approximately 1.8 km in length and is capable of handling 8,000t barges. Coal is to be barged to an offshore transshipment point and loaded onto geared vessels. It
is planned to extend the jetty a further 1.2 km in the future to load Panamax vessels.
The PIK deposit has been subject to close-spaced shallow open hole drilling with “touch” coring of coal seams for obtaining coal samples for analysis. Geophysical logging was completed on a number of drill lines
across the deposit in order to raise the level of confidence in seam correlations. However, seam continuity at depth is difficult to confirm due to the relatively shallow drilling. As a result, MMC considers the level of
confidence of data to be adequate only for Coal Resource estimates of maximum Indicated status. Additional down dip drilling including geophysical logging and more comprehensive coal quality testing is in progress as of
the time of reporting and this will allow the level of confidence of Coal Resources and Reserves to be raised in future reporting.
The PIK deposit Coal Resources are estimated to total 85 million tonnes Mt, of which 0 Mt are classed as Measured, 49 Mt as Indicated with the balance of 35 Mt as Inferred.
Coal Reserves were estimated by applying mining factors and exclusion criteria to the Coal Resources. The mining factors such as recovery and dilution were defined from the current open cut mining method. The
exclusion criteria included the lease boundary and a minimum working section thickness. Minex “Optimiser” software was used to generate a series of incremental pit shells which reflect different economic scenarios and
changes in the breakeven incremental strip ratio. Results were examined and the preferred pit shells were then selected by determining the breakeven strip ratio corresponding to the predicted mining economics. Coal
quantities within this pit shell were then evaluated so that only Indicated Coal Resources were classified as Reserves.
Based on this approach a total of 22 Mt of Probable Open Cut Coal Reserves at an average strip ratio
7.8 bcm tonne were estimated. The average coal quality is TM 31.2, CV 4,680 kcalkg gar, ash 4.5 ar and sulphur content 1.4 ar. All the coal reserves are classified as “Probable” based on the level of detail
completed in the mine planning and also the level of confidence in the Coal Resources. Coal Resources are reported inclusive of Coal Reserves that is, Coal Reserves are not additional to Coal Resources.
A-82
There are a number of planning issues which may impact on the stated mining reserves. These include: ‰ ongoing geotechnical studies,
‰ ongoing exploration drilling and updates to the geological model, and ‰ ongoing mine planning including different mining equipment and more detailed planning of the start
up period. These issues may cause the pit shell and mining quantities to change in future JORC statements.
The Coal Resource estimates in the report were estimated by Mr. William Park, BSc Geology, BEcon, MAIG who is a Member of the Australian Institute of Geoscientists. The estimates are based on information
compiled and reviewed by Mr Park. He is a full time employee of MMC and has sufficient experience which is relevant to the style and type of deposit under consideration and to the activity undertaken to qualify him as a
Competent Person
as defined in the 2004 Edition of the JORC Code. The Coal Reserve estimates in the report were estimated by Mr Paul Westcott BE Mining, Hons,
FAusIMM, CPMin, MMICA, MAIME, who is a Chartered Professional Mining Engineer, a Fellow of the Australasian Institute of Mining and Metallurgy, a Member of the American Institute of Mining Engineers, and a
member of the Mineral Industries Consultants Association. The estimates are based on information compiled and reviewed by Mr Westcott. He is a full time employee of MMC and has sufficient experience which is relevant to
the style and type of deposit under consideration and to the activity undertaken to qualify him as a Competent Person
as defined in the 2004 Edition of the JORC Code. This report may only be presented in its entirety. Parties wishing to publish or edit selected parts of the
text, or use the Statement for public reporting, must obtain prior written approval from MMC and the signatories of this report.
A-83
M A
K A
S S
A R
S T
R A
I T
M A
K A
S S
A R
S T
R A
I T
Sungai Belayan
e vi
R r
r e
vi R
Senyiur River S. Kedang Kepala
S ek
ura u R
ive r
S. Kin
tap Kecil
S .
K l
e d
a a
n
Sungai Mahakam
Sungai Barito
00 °3000 LS 00 °00 00
115 °3000 116 °0000
1° 0 00 LS 1° 0 00 LU
1° 30 0 LS
2° 00 0 LS 116 °3000
117 °0000 117 °3000
118 °0000 115 °0000
2° 30 0 LS
3° 00 0 LS
3° 30 0 LS 00 °3000 LU
Mahakam River S.
Pina ng
S. B
e n g a
l o n
S. Kedang Pahu
SAMARINDA
KAB. KUTAI TIMUR
KAB. KUTAI BARAT
KAB. PASIR
BALIKPAPAN
KALIMANTAN TENGAH
TIMUR
PIK - LOCATION PLAN
JORC RESOURCES AND RESERVES STATEMENT 31st March 2008
Date: May 2008 Job No: 3318M e
Figure: 1
PT Bayan Resources
Sangkulirang
Asemasem SP II
BR. TONGKOK TERING
Muara Tae TANJUNG BALUI
Transhipment point Laminpulut
Benanga TABANG
Umaq Dian
MUARA KAMAN Pendamaran
Tuana Tuha Muai
Gunung Sari Buluk Sen
Penoon KEMBANG JANGGUT
KOTA BANGUN D. Semayang
Ma. ANCALONG Long Nah
SENYIUR Ma.BENGKAL
D. Melintang Muara muntai
Rimbaayu DAMAI
MUARALAWA MELAK
B C T
MUARA NYAHING
TamiangLayang
TANJUNG
Ampah
S. BARITO
BUNTOK BETUNG
BANGKANAI
KINTAP SUNGAIDANAU
BONTANG
BANJARMASIN
MARTAPURA SANGKULIRANG
LONG IKIS T. GROGOT
BATULICIN SATUI
PELEIHARI
Muara Bengalon Lebuk Tutung
To Senyiur ± 67 Km
LINGAU Sepaso
KAB. KUTAI KARTANEGARA
KALIMANTAN
KALIMANTAN SELATAN
MUARATEWEH
MUARA PAHU MR.BUNYUT
SANTAN TG. MARANGKAYU
MUARA BADAK LEBAK CILONG
Gulfof Carpentaria
INDONESIA
Kalimantan
Borneo
Balikpapan
Palangkaraya
Samarinda Pontianak
Kalimantan
Laut
MALAYSIA
BRUNEI DARUSSALAM Bandar Seri Begawan
anjungredeb T
Banjarm sin
N
153060
PT. PERKASA INAKA KERTA
A-84
G. Penganakan
S. Pen
eb ar
an
Area = 51,36 Ha
S .
Na rut
S .P
el a
ng so
S. K
ela w
it an
BATAS KONSESI BATAS AREA KONSTRUKSI
To Sa
nga tta
S un
ga i Se
kur au
S. Se pek
S. B
e n g a
l o n
1
Rencana Office dan Camp MINE OFFICE
SENIOR CAMP
Mampang Village
Muaralembak Sepaso
PIK CAMP Area = 6 Ha
Jala n Tr
ans Kalti
m
JL. Beruang
JL. Hauling Hwe KPC
JL. Gabus JL. Blok B5
JL. Blok B6 JL. Blok B5A
JL. Blok B4 JL. Blok B3
JL. Blok B2 JL. Blok B1
JL. Blok A
Area = 5
Ha Area = 2 Ha
Area Quary Batugamping
PUBL IC RO
AD
Desa Sekerat
Su ng
ai M
amp an
g
STOCKPILE AND JETTY PLAN LUBUKTUTUNG
Batupondong
BU KI
T GA
M PI
NG
JA LA
N UMU
M JA
LA N
P U
Jala n T
ran s K
alti m
JAL A
N P
U
Jalan Blok
B
JALAN TAMBANG PIK
Area = 30 ha QUARRY PLAN
1 2
3 5
6 7
8 9
10 11
12 4
OF FIC
E WO
RKS HO
P B UM
A
EXPLOSIVES STORE
PIK - INAKAKERTA SITE LAYOUT
JORC RESOURCES AND RESERVES STATEMENT 31st March 2008
Date: May 2008 Job No: 3318M e
Figure: 2
PT Bayan Resources N
E 570
,000 E
580 ,000
E 590
,000
N 80,000 N 90,000
N 100,000
1. Workshop and Tool
2. ROM Stockpile 100.000 MT
3. Crushing Plant 1.000 MTHour
4. Clean Coal Stockpile Phase 4 nos x 65,000 tons
5. Settling Pond
6. Conveyor from stockpile to Barge Loader
7. Fuel Barge Jetty 500DWT
8. Barge Loader
9. Coal Barge 8.000 DWT
10. Control Building and Power House
11. Shiploader
12. Panamax Capesize Vessel 60.000 - 200.000 DWT
JEMBATAN SEKURAU
Kampung Sekurau Bawah
KONSESI PT. PIK AREA= 20.037 Ha
JEMBATAN PT. PIK RENCANA
A-85
SEAM S105= 3.45 SEAM S74A1= 3.10
IB = 246.10m
OPEN CUT
SEAM NAME THICKNESS
m
CURRENTPROPOSEDPOTENTIAL
OPEN CUT
CURRENTPROPOSEDPOTENTIAL
PIK - GENERAL STRATIGRAPHY
JORC RESOURCES AND RESERVES STATEMENT 31st March 2008
Date: May 2008 Job No: 3318M e
Figure: 3
PT Bayan Resources
SEAM NAME THICKNESS
m
Continued over
IB = 119.30m
IB = 253.10m
IB = 92.70m
IB = 153.70m IB = 41.90m
IB = 32.50m
IB = 236.90m
IB = 203.90m
IB = 24.60m IB = 29.90m
IB = 99.60m
SEAM S101= 2.80
SEAM S95= 4.36 SEAM S92= 2.78
SEAM S89= 3.15 SEAM S87A= 5.25
SEAM S87= 7.48
SEAM S81= 5.00
SEAM S76A= 6.99 SEAM S76AB= 5.69
SEAM S76= 5.78
IB = 99.60m IB = 17.60m
IB = 26.60m IB = 68.20m
IB = 130.40m
IB = 378.40m
IB = 288.70m
IB = 269.60m
IB = 19.80m
IB = 229.90m
SEAM S74A12= 2.90 SEAM S74A= 2.93
SEAM S72= 2.46
SEAM S68= 3.47
SEAM S61= 5.85
SEAM S51= 3.50
SEAM S45= 3.06 SEAM S44= 3.54
SEAM S39= 3.73
s s
A-86
A-87
574000E 575000E
MEASURED = INDICATED =
INFERRED = SUBCROP =
CONCESSION =
3185M_PIK SEAM S61
575000E 576000E
576000E 83000N
84000N 85000N
86000N 87000N
88000N
83000N 88000N
87000N
86000N
85000N
84000N
MEASURED INDICATED
INFERRED SUBCROP
CONCESSION
LEGEND
PIK - INAKAKERTA RESOURCE LIMITS - SEAM S61
JORC RESOURCES AND RESERVES STATEMENT 31st March 2008
Figure: 5
PT Bayan Resources
567000E 568000E
569000E 570000E
571000E 572000E
573000E 574000E
567000E 568000E
569000E 570000E
571000E 572000E
573000E
Date: May 2008 Job No: 3318M e
A-88
Lease Boundary
Pit Outlines
PIK - INAKAKERTA FINAL PIT SHELLS
JORC RESOURCESAND RESERVES STATEMENT 31st March 2008
Date: May 2008
PT Bayan Resources
Initial Pit
Figure: 6 Job No: 3318M e
A-89
Table of Contents
Page No.
EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
82
1. INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
92 1.1
I
NTRODUCTION
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
1.2 A
PPROACH
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
1.3 R
ELEVANT
R
EPORT AND
S
TUDIES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
1.4 P
REVIOUS
C
OAL
R
ESOURCE AND
R
ESERVE
S
TATEMENTS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
2. COMPETENT PERSONS STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
94
3. PROJECT DESCRIPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
95 3.1
G
ENERAL
B
ACKGROUND
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
3.2 L
OCATION AND
T
ITLES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
3.3 M
INING
O
PERATIONS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
3.4 I
NFRASTRUCTURE OF
S
ITE
F
ACILITIES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
3.5 T
RANSPORT AND
C
OAL
H
ANDLING
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
3.6 M
ARKETING
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
4. GEOLOGY, COAL QUALITY AND COAL RESOURCE ESTIMATE . . . . . . . . . . . . . . . . . . .
95 4.1
G
EOLOGY
O
VERVIEW
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
4.2 C
OAL
Q
UALITY
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
4.3 G
EOLOGICAL
D
ATABASE AND
M
ODELLING
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
4.4 D
ATA
V
ALIDATION
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
4.5 G
EOLOGICAL
C
ONFIDENCE AND
R
ESOURCE
C
ATEGORIES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
4.6 C
OAL
R
ESOURCES
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
5. COAL RESERVE ESTIMATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
102 5.1
C
OAL
R
ESOURCE
E
STIMATE
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
5.2 S
TUDY
S
TATUS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
5.3 C
UT
-
OFF
P
ARAMETERS AND
P
IT
L
IMITS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
5.4 M
INING
F
ACTORS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
5.5 M
ETALLURGICAL
F
ACTORS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
5.6 C
OST AND
R
EVENUE
F
ACTORS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
5.7 M
ARKETING AND
P
RODUCT
S
PECIFICATIONS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.8 O
THER
R
ELEVANT
F
ACTORS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.9 C
LASSIFICATION
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.10 A
UDITS AND
R
EVIEWS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.11 D
ISCUSSION OF
R
ELATIVE
A
CCURACY AND
C
ONFIDENCE
. . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
5.12 R
ESULTS
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
5.13 S
UMMARY
T
ABLE OF
M
ODEL
D
ATA
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
A-90
List of Tables
Table No. Description
Page No.
Table 4.1 — Average Thickness and Coal Quality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
96 Table 4.2 —
Resource Categorisation Parameters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Table 4.3 — Coal Resources Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100 Table 4.4 —
Coal Resources by Seam . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
Table 5.1 — Total Open Cut Coal Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
105 Table 5.2 —
Probable Coal Reserves by Seam . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
Table 5.3 — Summary of Model Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
106
List of Figures These follow the Executive Summary
Figure No. Description
Figure 1 Location Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
84 Figure 2
Site Layout . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
Figure 3 General Stratigraphy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
86 Figure 4
Typical Cross Sections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
Figure 5 Resource Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
88 Figure 6
Final Pit Shells . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
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1. INTRODUCTION
1.1 Introduction
Minarco-MineConsult Pty Ltd MMC was commissioned by PT. Bayan Resources Bayan to complete an independent estimate hereafter, referred to as the “Statement” of the Open Cut Coal Resources and Reserves
of their mining tenement PT. Perkasa Inakakerta hereafter referred to as “PIK” in East Kalimantan, Indonesia. The Statement reports the Coal Resources and Reserves as at 31
st
March, 2008 and has been undertaken in compliance with the requirements of the reporting guidelines of the 2004 Joint Ore Reserves Committee of The
Australasian Institute of Mining and Metallurgy, Australasian Institute of Geoscientists and Minerals Council of Australia “The JORC Code”.
MMC has adopted the following terms for the reporting of Coal Resources and Reserves:
‰ Coal Resources as used in this report are the same as “Mineral Resource” in The JORC Code and
“Geological Resources”, a common term used in the industry.
‰ Coal Resources have been subdivided into Measured, Indicated and Inferred Resources to reflect
the confidence in the underlying resource data.
‰ Coal Reserves as used in this report are the same as “Ore Reserves” in The JORC Code and “Mining
Reserves”, a common term used in the industry. Coal Reserves include geological and mining losses, roof and floor loss and dilution.
‰ Coal Reserves have been subdivided into Proved and Probable to reflect the confidence in the
underlying resource data and mine planning detail.
‰ Marketable Reserves allow for practical yields in a beneficiation plant, which is commonly known in
the industry as “product coal”.
‰ Coal Resources are reported inclusive of Coal Reserves, that is, Coal Reserves are not additional to
Coal Resources. Additional terminology applied within this report includes the following:
‰ Geological Model or “In Situ” Model is the computerised three dimensional representation of the
coal deposit based on topographic survey data, coal seam data derived from outcrop, drillhole or other data points, including coal thickness and quality.
‰ Optimiser is the Minex software applied to the geological model to determine the economic pit limits
by the application of such factors as geological and mining losses, loss and dilution, geotechnical slope design and costrevenue inputs.
‰ Optimised Pit Shell is the three dimensional economic pit limit determined using the Optimiser. ‰ Mineable Pit Shell is the optimised pit shell after modification to conform to a practical pit design.
‰ Mineable In Situ Coal non-JORC terminology as used in this report is in situ coal within the
mineable pit shell
‰ Run of Mine ROM Coal non-JORC terminology as used in this report is coal in the mineable pit
shell after application of geological and mining losses, roof and floor loss and dilution. ROM may include some Inferred coal resources.
1.2 Approach
The process adopted for completing the Statement is described below. 1.
An “in situ” geological model was created by Bayan geologists working on the PIK project using Mincom software. This model had no cut off criteria applied, hence the term “in situ” model.
2. This model and underlying raw data such as borehole logs, coal quality reports and geophysical
logs were reviewed by MMC geologist, Mr William Park. 3.
The Mincom model was then imported into Minex software. The reason for this step was to allow mine planning software called the “Optimiser” to be run.
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4. The geological model was categorised into Indicated and Inferred confidence areas and then coal
volumes, tonnages and qualities were estimated and reported in these categories after applying any cut-off criteria.
5. Cross sections, plans and deposit characteristics such as structure, number and thickness of seams
were examined in conjunction with the proposed equipment and mining method to decide on minimum mining thickness, coal losses and dilution factors. These factors were then used to
convert the in situ geological model to a ROM model.
6. Costs and revenue factors were supplied by Bayan and checked for reasonableness by MMC.
These were then converted in a form to suit the Optimiser software and together with other criteria such as depth constraints, geotechnical criteria and minimum mining thickness, a series of pit
shells were derived for varying revenue inputs.
7. Pit shells “Optimised Pit Shells” were selected and minor adjustments made as necessary to
form practical pit designs “Mineable Pit Shells”. These pit shells formed the basis of the subsequent reserves estimates.
8. The Indicated confidence limits were overlaid on these pit shells and any Inferred tonnes were
excluded from the estimate. 9.
The Coal Reserves were categorised as Probable based on the Coal Resource confidence and the level of detail in the mine planning.
10. Adjustments were the made for depletion due to mining since the previous Statements. 11. Checks were undertaken and results and supporting information documented in this report.
1.3 Relevant Report and Studies
The following reports, documents and studies were used as reference material in the preparation of the Statement.
1. Preston, KB and Sanders, RH, “Estimating the In-Situ Relative Density of Coal”, Australian Coal
Geology, Vol 9, pp22-26, May 1993. 2.
Australian Guidelines for Estimating and Reporting of Inventory Coal, Coal Resources and Coal Reserves, 2003.
3. Australasian Code for Reporting of Mineral Resources and Ore Reserves, The JORC Code,
2004. 4.
“PT. Perkasa Inakakerta, PIK Open Cut Coal Deposit Statement of Open Cut Coal Resources and Reserves as at 30
th
September 2007”. MMC Job number 3185M. 5.
“PT. Perkasa Inakakerta, PIK Open Cut Coal Deposit Statement of Open Cut Coal Resources and Reserves as at 31
st
January 2008”. MMC Job number 3318M_e.
1.4 Previous Coal Resource and Reserve Statements
MMC has previously prepared two Coal Resource and Reserve statements compliant with the JORC Code for this project dated 30
th
September 2007 and 31
st
January 2008. There has been no updated geological model since 31
st
January 2008 but there has been some mining 171,048 tonnes from various seams. Coal Resource and Reserve estimates are therefore unchanged from the previous report except for depletion of mined
out coal.
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