Pan Asia Corporation signs MOU with China's ZIEC on TCM coal project
Pan Asia Corporation (ASX: PZC) has signed a Memorandum of Understanding
(MOU) between PT TransCoal Minergy (PT TCM) and Zhongding International
Engineering Co Ltd (ZIEC) covering the TCM coal project in South
Kalimantan, Indonesia.
ZIEC, which is headquartered in Nanchang,
China, has been recognised as one of the world’s top 225 international
contractors and has considerable mining experience in Indonesia and
Asia.
The company has previously stated its ambition to
establish an underground mine in Indonesia, targeting production of at
least 1.5 Mtpa in 2012.
Alan Hopkins, chief executive officer,
commented “this early strong expression of commercial interest in the
TCM underground project by a group with long experience in underground
coal mining is another terrific step forward after the recent
announcement of a maiden JORC resource."
"We do however
anticipate additional strong interest as it is still early days for this
high value coal project,” he added.
Under the MOU, the parties
have agreed that ZIEC will provide advice on drilling and project
development matters with an emphasis on underground mining at the TCM
tenement.
Subject to the completion of additional drilling to
define the ultimate resource tonnages and the undertaking of a
feasibility study, the MOU provides that ZIEC may, subject to
establishing a fair commercial market price and contingent on assisting
with project development finance, undertake the underground mining
operations and become the majority owner of the project.
Upon
completion of the company’s acquisition of Innovation West and the
execution of final transaction documents between Innovation West and PT
TCM, in relation to which a memorandum of agreement has already been
executed, the company would acquire ultimate ownership of a minimum of
75% of the TCM project.
The company said the MOU at this stage is
non binding as commercial terms will not be set until after
feasibility.
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