PKP2B AND IUP AREAS

year 2036. PKP2B may be extended before expiration date through agreement between the PKP2B holders and the Government. Meanwhile, the Ministry of Energy and Mineral Resources can terminate the PKP2B if the PKP2B holders fail to fulfill the requirements as stipulated in the PKP2B. Mining operations are currently located in Batulaki and Sebamban Blocks. Coal mining operations in the future will be made in Kusan and Girimulya Blocks. The table below shows the estimation summary of proven and probable coal reserves within PKP2B concession area of BIB and production data of 2009, 2010 and the six-month period of 2011. Block M ineable Reserve in million Tons Product ion in Tons Proven Pr obable Tot al 2009 2010 Six-mont h period of 2011 Bat ulaki NA NA NA 915,660 801,141 521,309 Sebam ban NA NA NA 267,010 316,905 654,323 Kusan 239.0 97.0 336.0 - - 485 Girimulya 176.0 234.0 410.0 - - - Jumlah 415.0 331.0 746.0 1,182,669 1,118,046 1,167,117 Sour ce: The am ounts of m ineable r es er ves ar e fr om Independent Tec hnic al Repor t of SMGC on Mar ch 2 011. The amount of proven and probable coal reserves are calculated using JORC standard methodology. The table below shows a summary of estimated amount of measured, indicated and inferred coal resources according to JORC standard methodology in Kusan, Girimulya, Batulaki and Sebamban blocks as of June 30, 2011. in Million Tons Block Est imat ed Coal Resources M easur ed Indicat ed Inferred Tot al Bat ulaki 10.9 7.8 7.5 26.2 Sebam ban 19.1 6.4 2.1 27.6 Kusan 330.1 215.3 318.8 864.3 Girimulya 260.1 284.2 173.6 717.9 Jumlah 620.2 513.7 502.0 1,636.0 Sour ce: The am ounts of m ineable r es er ves ar e f r om Independent Technic al Repor t of SMGC on Febr uar y and Mar c h 2 0 11. Concession area of KIM Total concession area of KIM and its subsidiaries covers area of 2,610 hectares. This concession is located in Sumatra, approximately 260 km to the southeast of city of Padang in Jambi province, Jujuhan district and Muara Bungo Regency. Mining operation area of KIM consists of a number of different concessions. However, due to the adjoining location of concessions, in mining practice these different concessions are treated as one mining area. The Batang Asam river that crosses the mining concession of KIM divides concession area of KIM into two major blocks, namely: iii KIM East Block; includes KIM1, KIM2, KCP, and BBU. iv KIM West Block; includes TBBU, BNP and BHBA. Currently, the mining operations have been carried out in both blocks. The table below shows the summary of estimated proven and probable coal reserves within the IUP concession area of KIM and production data of 2009, 2010 and the six-month period of 2011. Block M ineable Reserve in million Tons Product ion in Tons Proven Pr obable Tot al 2009 2010 Six-mont h period of 2011 East KIM 37.6 11.0 48.6 353,834 568,581 208,902 West KIM 23.8 7.2 31.0 - 69,625 406,465 Jumlah 61.4 18.2 79.6 353,834 638,206 615,367 Des cr iption: - Sour c e of inf or m ation about the am ounts of m ineable r eser ves ar e the Independent Technic al Repor t of SMGC on Febr uar y 2 011. - Not including the pr oduc tion of c oal fr om the m ining ar ea of TBA whic h ar e 2 6 4, 8 74 tons in 20 10 and 542 , 5 61 tons dur ing the per iod of s ix 6 months ended J une 3 0 , 2 0 11. The amount of proven and probable coal reserves are calculated using JORC standard methodology. The table below shows a summary of estimated amount of measured, indicated and inferred coal resources according to JORC standard methodology. in Million Tons Block Est imat ed Coal Resources M easur ed Indicat ed Inferred Tot al KIM East 66.3 26.9 8.7 102.0 KIM West 80.8 43.3 35.4 7.5 Jumlah 147.1 70.2 44.2 261.5 Sour ce: The am ounts of m ineable r es er ves ar e fr om Independent Tec hnic al Repor t of SMGC on Febr uar y 2 0 11. Concession Area of TKS The concession area of TKS owned by the Company covers an area of 9,707 hectares. This concession is located in Muara Teweh Regency, in the south of the equator in Central Kalimantan. TKS is located approximately 270 km from the city of Samarinda, East Kalimantan and 500 km from the city of Banjarmasin, South Kalimantan. The aforementioned concession area of TKS does not include IUP concession area of TKS pursuant to the Decision of Regent of East Barito No. 570 Year 2009 regarding the Approval of Alteration of Exploration Mining Permit into Production Operation Mining Permit of TKS dated December 31, 2009 in an area of 1,748 hectares. This concession is located in East Barito Regency, Central Kalimantan. All the coal excavation activities in this concession area, including but not limited to coal transport to the stockpile, repair andor maintenance of roads, mine drainage, up to the reclamation is carried out by PT Samudera Bahtera Kencana Sakti hereinafter referred to as “SBKS” pursuant to the Cooperation Agreement between TKS and SBKS dated September 1, 2008. The scope of these works will finish when the coal reserves in this concession area is exhausted and all of the mining costs, including but not limited on taxes, employees social security, insurance for all workers who work in the concession area will be the burden of SBKS. The coal produced in this concession area will be purchased by SBKS as provided in Article 4 paragraph 1 of the Cooperation Agreement. The Company has started the production trial phase in 2010. The production activities will be started in the second quarter of 2011. The table below shows the summary of estimated proven and probable coal reserves and production data of 2009, 2010 and the six-month period of 2011 in IUP concession area of TKS in Muara Teweh. Block M ineable Reserve in million Tons Product ion in Tons Proven Pr obable Tot al 2009 2010 Six-mont h period of 2011 TKS 30.6 2.6 33.2 - 8,569 53,383 Sour ce: The am ounts of m ineable r es er ves ar e f r om Independent Technic al Repor t of Danm ar Explor indo on Febr uar y 2 0 11. The amount of proven and probable coal reserves are calculated using JORC standard methodology. The table below shows a summary of estimated amount of measured, indicated and inferred coal resources according to JORC standard methodology. in Million Tons Block Est imat ed Coal Resources M easur ed Indicat ed Inferred Tot al TKS 38.0 3.3 1.9 43.2 Sour ce: The am ounts of m ineable r es er ves ar e f r om Independent Technic al Repor t of Danm ar Explor indo on Febr uar y 2 0 11. The total production of coal in the three mining areas shows an increase from year to year. This is because the availability of supporting facilities and infrastructures and the opening of new pits. In line with the increase in production quantities, the amount of coal sales of the Company and its subsidiaries in an outline also increased from 1.25 million tons in 2008 to 1.57 million tons in 2009, 1.45 million tons in 2010, and 1. 96 million tons in the six-month period ended June 30, 2011. With the addition of infrastructure facilities and opening new pits, it is expected that the amount of coal production of the Company and its subsidiaries will increase significantly in the years to come. Concession Area of MAL The concession area of MAL covers an area of 4,836 hectares. MAL is located in South Sumatra, approximately 266 km the south-east of the city of Padang, the capital of West Sumatera Province. Coal mining activities have not been started in this area. Concession area of NIP The concession area of NIP covers an area of 4,500 hectares. NIP is located in South Sumatra, approximately 266 km the south-east of the city of Padang, the capital of West Sumatera Province. This area is located adjacent to the concession area of MAL. Coal mining activities have not been started in this area.

6. COAL PRODUCTS

The Company has a variety of coal products. The following are specifications of products owned by the Company: Coal Products of BIB Coal reserves of BIB are sub-bituminous type of coal of Warukin formation. Coal reserves of BIB are contained within several coal layers where the slopes of the layers range from 10 to 25 degrees.  Batulaki block was identified to have 52 coal layers and sub-layers. The thickness of coal layers range from 0.4 to 13.9 meters.  Sebamban block was identified to have 23 coal layers and sub-layers. The thickness of coal layers range from 0.4 to 8.6 meters.  Kusan block was identified to have 41 coal layers and sub- layers. The thickness of coal layers range from 0 to 26.4 meters.  Girimulya block was identified to have 36 coal layers and sub-layers. The thickness of coal layers range from 0 to 13.0 meters. BIB’s coal which is currently sold to customers is the product of Batulaki and Sebamban blocks with calorific value ranges from 5,200 kcalkg to 5,700 kkalkg adb. General specifications of the BIB’s coal are summarized in the table below: Coal Specification Batulaki Block Sebambang Block Kusan Block Girimulya Block Tot al M oist ure ar 33.00 39.00 34.90 35.10 Inherent moist ure adb 15.00 13.00 15.10 15.20 Ash cont ent adb 3.90 5.50 6.70 7.60 Tot al Sulfur adb 0.16 0.22 0.20 0.30 Calorific Value adb kkal kg 5,700 5,500 5,300 5,200 Sour ce: The Independent Technic al Repor t of SMGC on Febr uar y and Mar c h 20 11 Coal Products OF KIM Coal reserves of KIM and its subsidiaries are sub-bituminous type of coal which were formed in Pliocene age and were included in Muara Enim formation. The mining areas of KIM and its subsidiaries were identified to have eight layers and sub-