Cloudified Holdings Limited Regulatory News (CHL)

15 Feb 2007 13:21

Churchill Mining plc15 February 2007 15 February 2007 CHURCHILL MINING PLC ("Churchill" or "the Company") Agreement signed with PT Techno Coal Utama on East Kutai coal project in Indonesia Churchill Mining Plc (AIM: CHL) announces that the Company has signed anExclusivity Agreement with PT Techno Coal Utama to enable it to conduct duediligence work on a thermal coal project located in the East Kutai Regency ofKalimantan, Indonesia. Highlights: • Exploration position expanded by signing Exclusivity Agreement on additional Kalimantan ground at East Kutai • Two rigs to be sent to East Kutai to test coal seam outcrops ranging from two to seven metres thick as part of due diligence • Ground resistivity and drilling continues at Sendawar The East Kutai project area covers approximately 399 square kilometres made upof two blocks and is situated 110 kilometres northwest from the main populationcentre of Sangatta. Churchill will send two rigs to East Kutai, expected to be on site fromapproximately 21 February 2007, to begin a 10-15 hole, 1,000 metre verificationdrilling programme that has been designed to test outcrop targets identified inthree previous field reconnaissance surveys. Work conducted by consulting groupPT Rimeneco Geological and Mining Services in December 2006 and January 2007 hasidentified numerous outcrops of coal in the area, which range in thickness fromtwo to seven metres, hosted in a sequence of Tertiary sediments cropping out inthe area. The verification programme can be comfortably funded from theCompany's existing cash reserves and will be concluded before the Company entersinto formal purchase negotiations. Paul Mazak, Joint Managing Director of Churchill, said: "The East Kutai projectcould be a significant opportunity for the Company, especially given thechanging dynamics of the global thermal coal market which is moving towardssourcing lower energy coals, but coals which have the cleaner burning advantagesof low sulphur and low ash." The Regency of East Kutai's coal prospectivity has been re-evaluated by severalcompanies in recent times. The catalyst for the renewed interest has been a newdiscovery called Pakar, made by a private Indonesian group, which sitsapproximately 55 kilometres south-west of Churchill's ground. The Pakarproject, as of December 2006, had a JORC compliant resource of 3.3 billiontonnes of thermal coal. The resource is believed to be open in a variety ofdirections and is still being drilled. The two rigs being sent to East Kutai will come from Churchill's Sendawarproject (also in Kalimantan at West Kutai) where the company is exploring forhigh-grade thermal coal. To date the Company has drilled 30 of out the 64 holesplanned for the second round drilling campaign. Whilst the Company continues tobe encouraged by the regular intersection of coal seams, the initial seamthicknesses intersected to date are considered unsuitable for mining. However,more recent use of ground resistivity surveys has proven to be an excellentinterpretive tool for helping predict seam location and thickness and hasimproved drilling success rates. Consequently, the Company will modify its exploration programme by conducting anextensive ground resistivity programme in the western blocks of the Sendawarproject further to refine drill targets whilst the due diligence process isbeing carried out in East Kutai. Meanwhile, a third drill rig will continue totest other prospective positions in the east of the Sendawar project. Churchill maintains an active sourcing programme for coal exploration and miningopportunities both in Indonesia and elsewhere and will continue to examine moreprojects throughout 2007. The Company believes that by securing large,strategic ground positions and drilling them, it can add significant valuebefore considering partnering or other options to bring resources intoproduction. ENDS Enquiries: Churchill Mining Plc Corporate Synergy Parkgreen Communications Paul Mazak/James Hamilton Olly Cairns Justine Howarth/Brendan McNamara+61 (0)8 9388 0377 020 7448 4400 020 7851 7480 paul.mazak@churchillmining.com james.hamilton@churchillmining.com Notes to editors Churchill Mining Plc listed on AIM in April 2005. It has two projects and inearly 2006 raised GBP5.25 million to acquire and explore the Sendawar coalproject. South Woodie Woodie The South Woodie Woodie project covers approximately 490 square kilometres inthe East Pilbara region of Western Australia. Owned via Churchill Mining'swholly-owned subsidiary, Planet Mining Pty Ltd, the project sits approximately400km southeast of Port Hedland in the highly prospective Pilbara manganeseprovince. Churchill owns the project 100%. To date much of the project areahas never been explored due to the presence of surface cover. Churchill hasconducted a versatile time-domain electromagnetic (VTEM) geophysics survey todefine targets for drilling. VTEM is a leading heli-borne technology that candetect conductive mineralization and related structures to depths of 400m belowsurface. Sendawar The Sendawar project in Kalimantan, Indonesia, covers more than 1,000 squarekilometres of prospective ground and lies in close proximity to two operatingopen-cut mines: Thai miner Banpu's newly commissioned Trubaindo operation, whichwill shortly be producing at a rate of approximately six million tonnes perannum (tpa); and the privately-owned Gunung Bayan mine which has been operatingsince 1998 and produces approximately 3.4 million tpa. Coal from these mines istransported by barge via the Mahakam River to the port of Samarinda. TheSendawar project is located approximately 50km from the Mahakam River. Inaccordance with the AIM Guidelines, Mr Brett Gunter, of PT GMT Services, is thequalified person that has reviewed the technical information contained in thisrelease. This information is provided by RNS The company news service from the London Stock Exchange