Orpheus gets coal cash

ORPHEUS Energy has been able to overcome flooding of the South Kalimantan Kintap area to make a coal sale.

Noel Dyson

A barge-load of 5000 metric tonnes from the ADK joint venture has been shipped out of the SKJM port and sold to an Indonesian trading group.

The first shipment since unseasonal heavy rain and major flooding in the Kintap area is also a trial shipment for the trading group.

The group is negotiating with Orpheus to enter into a regular supply contract.

The coal has a typical South Kalimantan product specification of 5300-5500 kilocalories per kilogram on an air-dried basis and is low in ash and sulfur.

The trial shipment earns the ADK JV about a $A5 ($US5.20) per metric tonne net margin.

Long-term and spot contracts are under negotiation for the 50,000t-plus stockpile and ongoing production.

The SKJM port is located about 6km from the ADK coal mine.

Travel time is about two hours by barge to ships offshore where the loading time is about six to seven hours per barge.

There is sufficient infrastructure capacity at SKJM and the nearby SSDK port for Orpheus to achieve its initial 50,000t per month production target.

Orpheus executive chairman Wayne Mitchell said that despite the challenging trading conditions the company was still able to make a profit on sales.

He said as it ramped up to its target 50,000tpm production target the net margin was expected to increase.

“We are on target to becoming a cashflow positive company in the near term,” Mitchell said.

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