CHURCHILL MINING PLCchurchillmining.com/library/file/Churchill AGM Presentation 2011... · 10 March...
Transcript of CHURCHILL MINING PLCchurchillmining.com/library/file/Churchill AGM Presentation 2011... · 10 March...
CHURCHILL DIRECTOR’S
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David QuinlivanExecutive Chairman
Faroek BasrewanNon Executive Director
Jan CastroNon Executive Director
Gregory RadkeNon Executive Director
Rachmat GobelNon Executive Director
Fara LuwiaNon Executive Director
CHURCHILL MINING HAS BEEN RAPIDLY DEVELOPING
THE EKCP SINCE 2007
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Feb 2007
EKCP Exclusivity Agreement (RTM/RTP)
April 2007
Multiple Coal Seams Discovered
at EKCP
May 2007
EKCP Sales Agreement (RTM/RTP)
March 2008
EKCP Scoping Study
Commences
April 2008
Secures Interest in Additional IR/INP
Blocks (75%)
April 2008
Initial JORC Resource of 250Mt
September 2008
JORC Resource of 1.4Bt
October 2009
JORC Resource of 2.4Bt inc 956Mt
Reserve
February 2010
JORC Resource of 2.73Bt inc 961Mt
Reserve
April 2010
MOU with PLN for 5Mtpa Off-take
June 2010
Churchill takes direct majority ownership of holding entity for key
ECKP tenements RTM/RTP (75%)
September 2010
30Mtpa Feasibility Study Completed
December 2010
Port Land Acquisition Completed
Key Milestones
EKCP - PROJECT HIGHLIGHTS
World-Class
Mining Asset
Headline Facts
Robust
Economics
World-Class
Infrastructure Asset
Near-term Producer and
Scaleable Operation
• Large-scale, long-life, lowest-quartile operating costs
• High-quality sub-bituminous thermal coal
• 2.73 billion tonnes resource
• NPV10% $1.8 billion, 21% IRR, payback 7 years
• Average pre-tax net cash flow in excess of $500 million per annum
over an initial 25 year period
• Capesize port
• 160 km transport corridor, Conveyor and/or rail options
• 100 MW power station
• 3 Year design and construct period supports production start in
2014, with a 2 year fast track option
• Mine planning scenario analysis supports production levels up to
50Mtpa, base case 30Mtpa
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Regional Benefits• Major Economic development for the East Kutai Region
• Substantial Investment in Employment, Community and
Infrastructure
EKCP IS POSITIONED IN THE TOP QUARTILE OF THE
COST CURVE MAKING IT AN ATTRACTIVE ASSET…
Source: AME Thermal Coal FOB cost curve
Industry Thermal Coal Cost Curve (2010)
World-Class Mining Project with Low Operating Costs
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THE LAST 12 MONTHS…
Positive start
• EKCP rapidly developed since 2007
• Credit Suisse appointed to complete a strategic review
• EKCP ready for development
• Port Land acquisition completed in Dec 2010
• Preliminary rail studies underway
• Additional studies for 30 to 40mtpa production rates
• Application to Administrative Tribunal to have the Bupati’s purported revocation decrees expunged from the record
Surprising decision by the Administrative Court
• Appeal to the Administrative High Court of Jakarta (appeal rejected)
• Appeal to the Supreme Court of Indonesia (decision pending)
• Progress on EKCP delayed
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CHURCHILL’S INVESTMENT DISPUTE IN INDONESIA
NUSANTARA GROUP ENTITIES
• PT Erabara Persada Nusantara (EPN)
• PT Batubara Nusantara Kaltim (BNK)
• PT Kaltim Nusantara Coal (KNC)
• PT Nusantara Kaltim Coal (NKC)
•PT Nusantara Santan Coal (NSC)
• PT Nusantara Wahau Coal (NWC)
RIDLATAMA GROUP ENTITIES
(CHURCHILL 75% CONTRACTUAL OR EQUITY
INTEREST)
•PT Ridlatama Tambang Minerals (RTM)
•PT Ridlatama Trade Powerindo (RTP)
•PT Investmine Nusa Persada (INP)
(Contractual interest)
•PT Investama Resources (IR)
(Contractual interest)
WHO IS NUSANTARA?
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Mr. PRABOWO SUBIANTO
Mr. PRABOWO SUBIANTO
PT NUSANTARA ENERGINDO COAL
PT ITHACA RESOURCES
PT RUMADANA VENTURES
PT CAHAYA BUMI MAKMUR
Mr. AGUS PROJOSASMITO
Mr. BOB YANUAR
Mr. YOSEPH FRANCISCUS
BONANG
PT BINA INDOVITA
99.9%.1%
60% 40%
15% 85%
60%
40%
99.992% .008%
Mr. HUSEIN SUSILO TJIOE
(ALSO DIRECTOR)
Mr. KAREL BUDIMAN
(ALSO COMMISSIONER)
50% 50%
PT
NUSANTARA
KALTIM COAL
PT KALTIM
NUSANTARA
COAL
PT NUSANTARA
SANTAN COALPT BATUBARA
NUSANTARA
KALTIM
PT
NUSANTARA
WAHAU COAL
PT ERA BARA
PERSADA
NUSANTARA
Source : Indonesian Ministry of Justice
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EKCP HISTORY 2005 - 2007
2005
YEAR EVENTS
2006
2007
Nusantara Granted KP - Exploration Licenses
Bupati - Awang Farouk Ishak
1. PT. EPN License valid - (2 years) 10/03/05 - 10/03/07
2. PT. BNK License valid - (1 year) 10/03/05 - 10/03/06*
3. PT. KNC License valid - (1 year) 10/03/05 - 10/03/06*
4. PT. NKC License valid - (1 year) 10/03/05 - 10/03/06
5. PT. NSC License valid - (2 years) 10/03/05 - 10/03/07
6. PT. NWC License valid - (1 year) 10/03/05 - 10/03/06*
• LICENSES LATER TO OVERLAP WITH RIDLATAMA/CHURCHILL LICENSES
10 March 2006 – Nusantara licenses (BNK, KNC, NKC & NWC) expire
10 March 2007 – Remaining Nusantara licenses (EPN & NSC) expire
Ridlatama/Churchill Granted KP - General Survey Licenses
Bupati - Awang Farouk Ishak
1. PT. RTM License valid - (1 year) 24/05/07- 24/05/08
2. PT. RTP License valid - (1 year) 24/05/07- 24/05/08
3. PT. INP License valid - (1 year) 29/11/07- 29/11/08
4. PT. IR License valid - (1 year) 29/11/07- 29/11/08
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EKCP 2008
2008
YEAR EVENTS
April 2008 – Churchill announces first JORC calculation of 250Mt of
coal resources. Exceeds Q1 target by 150% at EKCP.
May 2008 – CHL announces an increase in coal reserve target by
50% to 150Mt at EKCP
Ridlatama/Churchill Granted KP - Exploration Licenses
Bupati – Awang Faoruk Ishak
1. PT. RTM License valid - (3 years) 09/04/08- 09/04/11
2. PT. RTP License valid - (3 years) 09/04/08- 09/04/11
3. PT. INP License valid - (3 years) 09/04/08- 09/04/11
4. PT. IR License valid - (3 years) 09/04/08- 09/04/11
Nusantara Granted Extension of Expired KP - Exploration Licenses
Bupati – Awang Farouk Ishak
1. PT. EPN License valid - (1 year) 17/07/08- 17/07/09
2. PT. BNK License valid - (1 year) 17/07/08- 17/07/09*
3. PT. KNC License valid - (1 year) 17/07/08- 17/07/09*4. PT. NKC License valid - (1 year) 17/07/08- 17/07/09
5. PT. NSC License valid - (1 year) 17/07/08- 17/07/09
6. PT. NWC License valid - (1 year) 17/07/08- 17/07/09*
• Licenses later to overlap with Ridlatama/Churchill licenses
CHURCHILL NOT NOTIFIED BUPATI HAS GRANTED LICENSE EXTENSIONS
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EKCP 2008 - 2009
2008
YEAR EVENTS
September 2008 – CHL announces JORC compliant resources of
1.4 billion tonnes of coal. Exceeds company
target by 140%.
December 2008 – Isran Noor appointed Bupati of East Kutai.
Awang Farouk Ishak appointed Governor of
East Kutai.
January 2009 – Police investigate Nusantara’s allegation of
criminal acts by Ridlatama when obtaining EKCP
licenses and find “no criminal acts”. Allegation
rejected with “No Case to Answer”.
January 2009 – New Mining Law introduced in Indonesia
2009
February 2009 – East Kutai Auditor General Investigates State
Financial Audit Agency (BPK) allegation of
forgery by Ridlatama. Subsequent Bawasda
investigation instigated by the Regency finds in
March 2010 that Ridlatama’s EKCP Licenses
were “Legitimate and Accountable”.
Investigation also confirms that Nusantara’s
licenses had expired.
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EKCP 2009
2009
YEAR EVENTS
Ridlatama/Churchill granted IUP – Exploitation Licenses
Bupati - Isran Noor:
1. PT. RTM License valid - (20 Years) 27/03/09 - 27/03/29
2. PT. RTP License valid - (20 years) 27/03/09 - 27/03/29
3. PT. INP License valid - (20 years) 27/03/09 - 27/03/29
4. PT. IR License valid - (20 years) 27/03/09 - 27/03/29
Note: Ridlatama/Churchill’s KP – Exploration Licenses were converted to IUP -
Exploitation licenses with new licenses having a term of 20 years with an
option to extend by 2 x 10 year periods in accord with new mining law.
May 2009 - CHL announces Resource Upgrade to 3 billion tonnes
July 2009 - Nusantara licenses expire again on 17 July 2009
Nusantara granted IUP - Exploration Licenses
Bupati - Isran Noor
1. PT. EPN License valid - (2 year) 29/07/09 - 29/07/11
2. PT. NKC License valid - (2 year) 29/07/09 - 29/07/11
3. PT. NSC License valid - (2 year) 29/07/09 - 29/07/11
Note : These licenses do not overlap with the Ridlatama/Churchill licenses.
October 2009 - Churchill Announces initial JORC Mining Reserve of
956 million tonnes
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EKCP 2009 - 2010
2009
YEAR EVENTS
Nusantara granted IUP - Exploration Licenses Bupati - Isran Noor:
1. PT. BNK License valid - (2 year) 18/02/10- 18/02/12*
2. PT. KNC License valid - (2 year) 18/02/10- 18/02/12*
3. PT. NWC License valid - (2 year) 18/02/10- 18/02/12*
Note: These licenses overlap with Ridlatama / Churchill’s licenses, The
Nusantara licenses had expired a second time and were again granted
without reference to Churchill.
9 Sept 2009 Ridlatama applies to Forestry Ministry for forestry
licenses. Application includes supporting letters
from Governor Awang Farouk Ishak & Bupati Isran
Noor.
19 April 2010*- Purported complaint letter by Dayak Tribe to Forestry
Ministry claiming illegal activities by Ridlatama.
21 April 2010*- Minister of Forestry issues letter to Bupati of Kutai
Timur to cancel mining licences of Ridlatama for
alleged forestry crimes.
22 April 2010* - Letter from the Forestry Minister discussed in meeting
of technical service officers of East Kutai region.
2010
* CHURCHILL/RIDLATAMA NOT ADVISED OF THESE LETTERS
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EKCP 2010
2010
YEAR EVENTS
Nusantara granted Forestry licenses for exploration work:
1. PT. EPN License dated 07/07/10
2. PT. NKC License dated 31/08/10
3. PT. NSC License dated 29/06/10
24 June 2010 – Nusantara requests Ministry of Energy & Mineral
Resources (MEMR) to revise the local mining map to
show they held mining licenses that overlapped with
CHL EKCP licenses**
30 April 2010 – Regency staff provide Bupati with Analysis Report
on the Forestry letter
04 May 2010 – Date of Revocation Decrees cancelling Ridlatama /
Churchill licenses purportedly signed by Bupati -
Isran Noor (denied signing when asked at a later
date). Bupati does not notify Ridlatama / Churchill
Note: Support for Nusantara application
for Forestry licenses for three
remaining entities not given by
MEMR due to overlapping with
Ridlatama/Churchill licenses.
27April 2010 – A Staff Evaluation Report was issued by the Head of
Mining Service of East Kutai alleging that Ridlatama's
licences dated 9 April 2008 were forged
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EKCP 2010 - 2011
2010
YEAR EVENTS
27 August 2010 – Ridlatama / Churchill make application to the
Samarinda Administrative Tribunal to have the
purported revocation decrees expunged from
the record.
2011
Nusantara applies for & is granted Forestry licenses for exploration:
1. PT. BNK Application 22/02/11 License date 15/06/11
2. PT. KNC Application 22/02/11 License date 15/06/11
3. PT. NWC Application 22/02/11 License date 15/06/11
28 October 2010 – Nusantara files an application to join the
Administrative Court proceedings relating to the
EKCP Licences
14 February 2011 – Chief of the Dayak Tribe sends legalised letter
to the Ministry of Forestry denying that they had
sent a complaint against Ridlatama
Note: Support for Nusantara application for
Forestry licenses for three remaining
entities given by MEMR even though the
overlapping issue with
Ridlatama/Churchill licenses remain
before Court. 03 Mar 2011 – Samarinda Administrative Court finds Bupati has
followed correct procedure and protocol in
revoking the EKCP licenses for circumstances
described in ruling.
Written judgments received 29 March 2011
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2011
EKCP 2011
YEAREVENTS
6 June 2011 – GBP 7.7m Placement to New Strategic Indonesian
Shareholders. Pak Rachmat Gobel and Ms Fara
Luwia join the Churchill Board
17 May 2011 – Churchill/ Ridlatama files an Appeal to the
Administrative High Court in Jakarta in response to
judgments
4 July 2011 – Churchill (ICD) delivers a notice of dispute to its
Indonesian partners (Ridlatama shareholders)
under the Investors Agreements and to Mr Rinaldi
for an unlawful act claim.
15 August 2011 – Churchill lodges an unlawful act claim against Mr
Andreas Rinaldi in the Tangerang District Court in
Jakarta
15 August 2011 – Churchill commences arbitration proceedings in
Singapore against other member of the
Ridlatama group for alleged breaches of the
investors agreements
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2011
EKCP 2011
YEAR EVENTS
22 Nov 2011 – Churchill UK solicitors send a letter to the President
of the Republic of Indonesia and other Senior
Indonesian Officials requesting the Indonesian
Government enter into discussions to amicably
resolve the dispute.
19 Aug 2011 – Appeal to Administrative High Court in Jakarta
dismissed.
15 Sep 2011 – Churchill / Ridlatama files an Appeal to the
Supreme Court of Indonesia (Decision pending).
11 Nov 2011 – Churchill receives two letters from Ridlatama
group companies PT Investmine Nusa Persada
(“INP”) and PT Investama Resources (“IR”),
claiming that ICD failed to make the initial
purchase payments provided for in the Investors
Agreement and, INP and IR were seeking to
terminate the Investors Agreement with ICD.
Churchill denies the allegations made and
confirms that all payments due have been made
in full. Churchill’s solicitors also believe that the
INP and IR letters have no legal merit and are
ineffective.
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NEXT STEPS…
• Churchill is well funded to continue to protect
shareholders interests
• Active Lobbying and Media Campaign underway to all
levels of Government/ Media in relation to the injustice to
Churchill and further the implications for foreign
investment into Indonesia
• Awaiting formal decision from the Supreme Court
• Consider Judicial Review
• Further consideration of International Arbitration if
necessary. Formal letter sent to the Republic of Indonesia-
November 2011
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CHURCHILL MINING PLC - 201124
CONTACT DETAILS
Churchill Mining
United Kingdom
Registered Office
55 Gower Street, London WC1E 6HQ
Australia
Suite 1, 346 Barker Road, Subiaco, Western Australia 6008
Postal Address
PO Box 8050, Subiaco East, Western Australia 6008
Tel +61 (0)8 6382 3737
Fax +61 (0)8 6382 3777
Web www.churchillmining.com
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