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Churchill Mining - preliminary pit design envisages low strip ratio

Thermal coal exploration and development company, Churchill Mining, reported further encouraging results from the East Kutai Coal Project in Indonesia, where 1.4 billion tonnes of inferred, indicated and measured resource have already been defined.  Churchill has a 75% interest in the East Kutai Coal Project, and has also extended the total size of the project to over 200 square kilometres.

Today Churchill released highlights of preliminary pit optimisation studies, which are part of a wider "fast-track to production" program at East Kutai.  The studies concluded that a low stripping ratio of 2.23:1 could be achieved on 500 million tonnes of the in-situ JORC compliant 1.4 billion tonne resource.  The pit studies focused on the northern half of the RTM block, and the calculation does not constitute a JORC mineable reserve, however, the results are very encouraging nonetheless.

Churchill's Managing Director, Paul Mazak, said that by focusing on coal with low stripping ratios, initial mining would see lower operating costs: "We are now approximately 12 months off our first phase of production at the East Kutai Coal Project. With the current international coal price having come off, these low stripping ratios are of great positive significance to the economics of the project. By focusing initially on the coal available at low stripping ratios, we are expecting to significantly reduce our operating costs during the initial period of mining, which is especially important on large projects such as this one."

Churchill Mining went on to add that it was "encouraged by the steps emerging countries are making towards introducing new sources of coal fired power".

"China is bringing forward its country electrification programme and Indian companies such as National Thermal Power Corporation, are in the process of constructing another 25,000 MW of power. With India unable to fulfil its thermal coal supply domestically, Churchill is well placed to capitalise on the future demand from India and the Company continues its discussions with a number of Indian companies about off-take agreements," the company stated.