LAND COMPENSATION AND CULTIVATED PLANTS MINING OPERATION ACTIVITIES

The stages of mining activities by means of open pit consist of: 1. Land clearing, Stripping and Removing the Topsoil Mine clearing operations are conducted at locations where mines will be opened or open pit. In connection with this operation, there are a number of works to be done which are: a Clearing of bushes and shrubs This work is done by using a bulldozer, which perform the digging-pushing function by utilizing the blade and the big pushing power. Bushes and shrubs that cover the mining area would be pushed to the edge of the mining areas. b. Felling trees and cutting woods Before the mining area clearing operations, it is necessary to fell trees and cut woods on the area to be cleared. In removing the woods, it is used heavy load lifting equipments and iron chains for binding and pulling, before transported by truck. c Topsoil stripping operation The topsoil, that contains lots of organic materials resulted from of weathering process that enrich the soil, stripping operation is performed after clearing the mine. This fertile soil layer is stripped by using the blade of bulldozer. The and topsoil layer is pushed and piled at specific locations close to bulldozer operations area, and then loaded using excavators and transported with a dump truck into the topsoil storage area. This fertile soil pile will be utilized when performing the reclamation work. 2. Excavation and overburden removal operations The operation of excavating the cover layer in the form of overburden and inter-burden, is performed by using excavator Komatsu PC-400, or other of the same class, and assisted by bulldozers Komatsu D155A and Komatsu D375A or others of the same class. Soft to moderate materials are directly excavated and loaded into dump trucks. For hard to very hard materials, the dismantling method is done in two ripping ways. The ripping process is performed for the material that has been hard on the assumption that dismantling by using the excavator is no longer optimal directfree digging. Ripping is done by using the Bulldozer equipped with a Ripper. The equipment used is Komatsu D155A and Komatsu D375A or others of the same class. Removal of excavated overburden material, is performed by using the excavator as a loading equipment, and dump trucks Nissan CWB or others of the same class as the means of conveyance. The cover soil layer is transported from the mining area to the planned dumping area, which is the nearest former mining area or dead areas nearby the mine. To overlay, leveling and compress the disposal, it is used Bulldozer Komatsu D155A or others of the same class. At first the cover soil will be piled at the dumping area that has been provided outside the excavation area outside dumping. The outside the dump is planned to be located in the northern part of the mine location. But if there is a mined area that has been completed then the “back filling” is performed, which is the hoarding of cover soil on mined areas. This method will reduce the distance of transportation besides it will also reduce environmental impact by refilling mined holes, then sown with the top soil prior to the reclamation work. The overburden excavation location and the location of overburden and top soil dumping area might be seen on the mining plan map. Specifically for mining roads, the maintenance is performed by using graders, compactors, and dust controller, in front of the mine area it is performed by using the water truck. 3. Excavation and Removal of Coal Operations Prior to the coal getting or the taking of coal activity the Coal Cleaning activity is performed, which is to clean the coal surface from non-coal materials such as the remaining cover soil from the stripping process or insertions betweenin the coal layers and other foreign materials. The instrument used for Coal Cleaning is the Excavator Komatsu PC-200 or other of the same class which is equipped with a bucket completed with Cutting Edge. For Coal Getting activity, coal excavation operation is performed by using Excavator Komatsu PC-200 or other of the same class assisted by bulldozers. For soft to moderate strength of coal, it will be directly excavated and loaded into dump trucks. For hard coal, first to be dismantled by using bulldozer Komatsu D155A or D375A or others of the same class, then dug and loaded by using the excavator. 4. Transportation of Coal to the Stockpile ROM, ROM into port, or from the pit directly to the port is the activity of transporting coal from the mines Front Loading to the location of Raw Coal at the Stockpile. The transportation is using Dump Truck Nissan CWB or other of the same class with capacity of 20 tons. 5. Coal stockpiling is the stacking of Raw Coal in an area designated for the stockpiling purpose. To set the stack, it is used the Wheel Loader Cat 966 F and Excavator Komatsu PC-200 or other of the same class. 6. Coal crushing is the process of crushing sizing the coal 7. Coal barge loading is the process of loading the coal into barges

11. PRODUCTION INFRASTRUCTURES AND FACILITIES

The entire coal products of BIB are transported to the location of coal stockpiling and barge loading facilities. Currently, the coal from Batulaki block is transported to the loading facilities at Abidin Port, while the coal from Sebamban block is transported to the Bunati Port. Abidin Port and Bunati Port respectively has an approximate capacity of 2 million tons per year and 2.5 million ton per year. Each port has a processing facility for coal crushing and screening. In both ports, the coal is crushed to size 50 mm before stockpiled and then loaded onto a barge with a capacity up to 8,000 tons. The process of barge loading generally takes more or less 5 five hours. The coal obtained from BIB mining operations is usually shipped directly to end users in Indonesia or to offshore transhipment point. Abidin Port is a port owned and operated by a third party, while Bunati Port is a port owned by BIB and operated by a third party. The Company currently plans to develop the capacity of Bunati Port. This development is planned for completion by mid to late 2011. This expansion is expected to increase the loading capacity up to nearly double with the target of loading capacity is up to 4.5 million tons of coal per year. In contrast to the BIB, the majority of coal production of KIM is currently transported by trucks with capacity of 30 tons over public roads andor private roads to end users which are related parties of the Company. Only in about late 2010, KIM began transporting the coal to two ports locations in Padang and in Jambi for the purpose to export the coal.