Sunday, natural resources company BHP Billiton (BHP) said it has approved the $100 million stage one development of the Maruwai metallurgical coal deposit in Indonesia with a view to meet continued strong global demand.
Maruwai is the generic name for a large, high quality metallurgical coal deposit in Central and East Kalimantan province that was discovered by BHP Billiton Minerals Exploration in the late 1990s.
The Melbourne, Australia headquartered mining company said the initial development project is the Haju open cut mine, along with an associated river port. The Haju mine, 100% owned by BHP Billiton, will initially produce around 1 million tones per annum with expansion potential to around 2 million tones.
Construction will start immediately, with first production expected in mid-calendar year 2009.
BHP Billiton President Coal, Dave Murray, said the approval was an important step that demonstrates the company's commitment to growing further its coal business.
A feasibility study is currently underway for development of a 3million to 5 million tones per year coal mine at the larger Lampunut deposit at Maruwai.
BHP rose $2.11 or 2.52% and closed Monday's regular trading session at $85.73.
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