Cokal Limited's Quarterly Report Highlights Major Progress in BBM Coal Production and Infrastructure
CKA (CKA) Share Update July 2024 Monday 29th
Cokal Limited Reports Significant Progress in BBM Coal Production and Infrastructure Development
Cokal Limited (ASX: CKA) has released its quarterly report for the three months ending 30 June 2024, showcasing significant advancements in coal production and infrastructure development at the BBM mine in Central Kalimantan, Indonesia.
Instant Summary:
- BBM commences coal product deliveries to domestic and international markets.
- Joint Venture with PT Petrindo Jaya Kreasi for haul road upgrades and infrastructure development.
- Immediate access to PT Petrindo's Intermediate Coal Stockpile for coal storage and delivery.
- Mobilization of three additional mining fleets to Krajan.
- Completion of critical infrastructure projects including camp facilities and weigh bridge.
- Ramp-up in BBM Mine production with two new mining fleets, increasing the total to five fleets by the end of April.
- Approval obtained for explosive magazine warehouse construction.
BBM Coal Production and Infrastructure Development
Cokal Limited has made significant strides in coal production and infrastructure development at its Bumi Barito Mineral (BBM) mine in Central Kalimantan, Indonesia. The company commenced coal product deliveries to both domestic and international markets, marking a major milestone in its operational capabilities.
In collaboration with PT Petrindo Jaya Kreasi, Cokal has focused on upgrading haul roads and developing additional infrastructure in the upper Barito River area. This joint venture has provided Cokal with immediate access to PT Petrindo's Intermediate Coal Stockpile at Teluk Betung Buntok, facilitating efficient coal storage and delivery.
Operational Enhancements
The BBM mine saw the mobilization of three additional mining fleets to Krajan, significantly boosting its coal production capacity. Cokal also completed several critical infrastructure projects, including new camp facilities at Pit 3, the Batu Tuhup Weigh Bridge, and upgrades to local roads, enhancing logistical efficiency.
By the end of April, two new mining fleets were added, bringing the total to five fleets operating at BBM. This ramp-up in production is expected to drive additional sales, with the new fleets capable of removing 450,000 to 550,000 BCM of overburden per month and producing approximately 25,000 tonnes of saleable coal monthly.
Coal Sales and Deliveries
BBM successfully delivered its coal products to the domestic and international markets, including a pilot shipment of 7,500mt of high-grade thermal coal to Sumber Global Energy (SGE) and 7,600mt of coking coal to PT Risun Wei San Indonesia. Subsequent deliveries continued to SGE and PT Kinrui, part of the NISCO Group, in May and June 2024.
Initial feedback from customers has been positive, with some concerns about ash levels being addressed. BBM is negotiating with a Chinese contractor to set up a Coal Wash Plant by the end of 2024 to upgrade its coking coal quality to premium standards.
Strategic Partnership and Corporate Activity
Cokal's strategic partnership with PT Petrindo Jaya Kreasi aims to increase coal transport capacity and optimize logistics systems. The joint venture focuses on haul road upgrades and infrastructure development, providing immediate benefits for coal storage and delivery.
On the corporate front, Cokal reported having USD 482k in cash at the end of the quarter and spent USD 1,525k on exploration and development activities. The company continues to monitor regulatory progress for its various projects and anticipates further advancements in the coming months.
The advancements in coal production and infrastructure development at BBM are likely to positively impact Cokal Limited's stock price. The ramp-up in production capacity and successful coal deliveries to the market demonstrate the company's operational strength and strategic planning. The partnership with PT Petrindo Jaya Kreasi further enhances Cokal's logistical capabilities, positioning the company for sustained growth.
Investor Reaction:
Analysts and investors have reacted positively to Cokal's quarterly report, noting the significant progress in coal production and infrastructure development. The strategic partnership with PT Petrindo Jaya Kreasi is seen as a key driver for future growth, and the successful coal deliveries have boosted investor confidence in Cokal's operational capabilities.
Conclusion:
Investors should closely monitor Cokal Limited's continued progress in coal production and infrastructure development. The company's strategic initiatives and operational enhancements position it well for future growth. Staying informed about Cokal's developments will be crucial for making informed investment decisions.