I am pleased to provide shareholders with an update on progress over the past several months. In summary the Company has continued to achieve designated milestones. The more significant of these are:
- Completion of construction at Tabang – White Energy and Bayan Resources have now successfully completed construction of the world’s largest clean coal upgrading plant at Bayan’s Tabang mine in East Kalimantan, Indonesia. The plant has the capacity to produce 1 million tonnes per annum of upgraded coal and is currently being commissioned. Commissioning is scheduled to be completed by the end of July 2009, thereby enabling operational ramp-up activities to commence;
- Indonesia Production Capacity – White Energy and Bayan Resources agreed in May 2009 to increase the target production capacity of their joint venture, PT Kaltim Supacoal (KSC). Targeted capacity was increased from 5 million to 15 million tonnes per annum. As regards to the funding of this increase in targeted capacity White Energy and Bayan Resources are in the final stages of selecting a Bank to underwrite the financing of the next 4 million tonne phase of the project;
- North American Partnership – White Energy and Peabody Energy Inc. (the largest coal company in the USA) signed a Joint Development Agreement in May 2009 regarding the formation of a partnership to jointly construct and operate 20 million tons per annum of binderless coal briquetting plants in North America. Once definitive transaction documents have been finalised, the joint venture will be 55% owned by White Energy and 45% owned by Peabody with capital costs to be shared in proportion to the parties respective equity interests. As part of the transaction, Peabody receives a right to acquire a 14.9% equity interest in White Energy;
- Buckskin Project – Permitting, engineering and design activities in relation to the development of the Company’s 1 million tonne per annum project (in the Powder River Basin) continue to proceed as planned.
- Capital Base – Subject to shareholder approval at this meeting, White Energy has successfully raised A$55 million in a share placement to local and overseas institutions conducted over a 24 hour book-build period at the end of May 2009. This will result in a significant enhancement to White Energy’s balance sheet. Also, recently concluded Share Purchase Plan Offer resulted in shareholders taking up 1,748,975 million shares and raising $2,623,463 million in new capital.