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Cokal Limited (ASX:CKA) declares the signing of a non-binding Heads of Agreement (HOA) with An PhatLoc General Trading Co. Ltd (An Phatloc) from Nam Dinh Province Vietnam to jointly progress shallow draft barging on the Barito River to transport metallurgical coal directly from the PT Bumi Barito Minerals (BBM) project area.
Cokal is an Australian listed company which aims toward turning into a metallurgical coal producer with a worldwide operation. There are four projects of interest for Cokal in Central Kalimantan, Indonesia which is considered to have excellent potential for metallurgical coal.
An PhatLoc General Trading Company Limited is located in the Shipping-Engineering Industrial area, in Xuan Truong Town, of Xuan Truong District, NAM Dinh Province of The Peopleâs Republic of Vietnam. An PhatLoc is a Vietnamese private company which constructs shallow draft barges and shallow draft push boats which may be able to operate on the Barito River for substantially more days each year than conventional towed barges. It also runs a logistics company providing barging services to Vietnamese resource companies.
During late December, two senior Cokal mining experts and Cokalâs CEO visited An PhatLoc in Vietnam to examine a four barge tow in operation on the Red River. All barges and the push boat were made by An PhatLoc and operated by its Logistics company. The quality of the barges generated by An PhatLoc impressed Cokalâs team and made them confident to count on them for transporting BBM coal from its mine near to the Barito River.
In early January An PhatLoc sent a team to examine the upper portion of the Barito River nearby and downstream from the BBM project. After scrutinizing the site at BBM, the An PhatLoc team met with Cokalâs group in Jakarta to sign a Confidentiality and Non-Circumvention Agreement.
Both the teams agreed in principle on suitable specifications of the barges and push boat design during the discussion in Jakarta. The Barges constructed by An PhatLoc carrying 1,700 tonnes of coal can be designed to function in 3m water depth. If the load is lessened to 1,000 tonnes, they will be able to operate in 1.95 water depth. It will ensure effective barging operations to be undertaken by Cokalâs BBM mining operation over notably longer duration than the conventional draft barges presently used in Indonesia.
A proposed schedule was agreed to finalize boat specification and negotiate commercial terms to purchase four barges and a push boat with delivery to the Barito River by mid-2019.
Happy with the progress on developing a shallow river solution for BBM, Cokalâs CEO, Mr. Jim Coleman said that the Cokal and An PhatLocâs cooperative relationship is vital to provide a reliable logistical outcome for delivering BBM premium metallurgical coal to the Asian marketplace on time. Their coal would arrive in a fresh state for their customers to receive the full benefit of their coking properties in their blast furnaces.
The shares of CKL are trading at A$0.050, down by 1.961 % (as at 3:27 PM, 21 January 2019).
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