Monday, March 16, 2009

East Kalimantan's Sebuku Island Coal Mine


Straits Resources subsidiary Straits Asia Resources which is listed in Singapore, owns and operates the Sebuku Coal Mine in Indonesia. The Sebuku coal mine is an opencut truck and shovel coal mining operation located on Sebuku Island, in the province of South Kalimantan, Indonesia. The mining concession is held under a second generation Coal Cooperation Agreement signed by PTBCS with the state Directorate of Mines & Energy.

Sebuku Island is located 3’30" south of the equator to the south-east of the island of Borneo, approximately 5km east of Laut Island. The island is 35km from north to south and is 10km wide at its widest point. The island has generally subdued topography with a maximum elevation of up to 125m along the series of hills that form the elevated eastern part of the island. To the west of the line of hills, the topography is gently undulating with elevations typically ranging from 5m to 25m. The western coastal zone is a series of grassy freshwater swamps bordered by a well-developed coastal mangrove zone up to 500m in width.

Sebuku Island is a remote location. Prior to the commencement of operations the population was 4,000 persons and virtually no infrastructure existed with the exception of local foot-trails. The population has expanded to about 4,500 and PTBCS has constructed local access roads and a new portsite on the southern end of the island. The PTBCS operations employ a total of approximately 700 people (PTBCS and contractors), of which 320 (some 46%) are local inhabitants, and are located in the south-west of the island. Following the construction of an airfield, access to the island is by fixed wing aircraft from Balikpapan or via a daily speedboat connection from nearby Kota Baru.

Regional location Map

Sebuku Mine Site Location Map

Preliminary exploration was undertaken in 1991 with detailed exploration being completed in 1994-1995. A detailed feasibility study was completed in 1996 by Coleman and Associates Pty Ltd which led to the approval of mining by the Directorate of Mines. A construction, mining and processing contract was awarded to John Holland in February 1997 following a competitive tendering process. Mining was contracted to Leighton Contracting Indonesia (LCI) who aquired John Holland Construction Indonesia in May 2000. In August 2003, the LCI mining contract was terminated and a new contract awarded to an Indonesian mining company Bukit Makmur Mandiri Utama (BUMA). LCI continues to run the processing facility.

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