

Aquarian
has acquired rights to 52,000 hectares in the Riau coal
basin of Sumatra, Indonesia.
The Aquarian Coal Corporation is
in process of changing name from Aquarian Gold Corporation.
- Huge ground position all prospective
- Existing
known deposit on part of property
- Neighbouring production
to SE
- Government discovery of 850 mt on northern
boundary
- 'World class' potential
- Possibility of very substantial reserves with
low overburden
- 20km from navigable river
- Low ash 'envirocoal'

The three Sumatran coal basins have been significant producers
of coal for over a century and contain two thirds of Indonesia
's known coal resources, with the balance located in Kalimantan,
West Java, and Sulawesi .
Studies show growing demand from the Chinese power generating
industry for Indonesian coal.
Coal continues to be second only to oil in meeting the world's
energy needs, with most production for domestic use.
The international traded coal market has traditionally been
influenced by Japanese demand. The new factor is the growth
of the Chinese economy, doubling in size each 6 to 7 years.
This is being reflected in increasing power demand, 70% of
which is being met by coal power stations. Indonesian thermal
coals are playing an important role in meeting that increase
in demand. Moreover, that demand will be (a) long-term and
(b) stable, generally under long term contracts. Indonesia
overtook Australia as the world's leading exporter of thermal
coals (mainly used for power generation) during the last
year. Australia remains the biggest exporter of coking coal
(mainly used in the steel industry).

Half of the
world's coal reserves consist of low-rank coal, such
as brown and sub-bituminous coal but the market for high-rank
bituminous coal has become tight because of the sharp
increase in coal shipments to China . In addition, Japan
is nearly 100% dependent on imported bitumous coal and
has, in the past, avoided use of low grade coals. However,
a new process has been developed by Kobe Steel that upgrades
brown coals (UBC process) to the same heat value as bituminous
coal and with both brown and sub-bituminous coals comprising
86% of Indonesia 's output this technology may contribute
significantly to Indonesia 's coal industry. Indonesia
also expects to increase its own proportion of usage
of coal as its energy needs rise.

Indonesia
's lower value coals are noted for their low-sulfur and
low-ash content. This makes them more environmentally
friendly.

In a Financial Times report (R. Bream, 2006) it is stated
that 'although prices have come down slightly from the peak,
coal for use in power stations - thermal coal - is still
selling at about $ 50 a tonne, more than double the lows
of 2002' .
The author states that a new vitality has entered the global
market due to the steel boom driven by China and increasingly,
high prices are encouraging the appearance of a new group
of coal companies, including several Indonesian groups, which
are exporting more coal to power stations in Europe as well
as in Asia .
The value of Indonesian thermal coal assets has risen sharply,
as reflected in a deal struck in March between Bumi Resources,
Indonesia 's biggest coal exporter, and a consortium led
by investment bank Renaissance Capital Asia. Bumi agreed
to sell two coal subsidiaries, Kaltim Prima and Arutmin,
for $3.2bn, having bought the assets in 2002 and 2003 for
a total of $ 675m .

Indonesian coal is one of the growth points
of the world energy/mining sectors. Transport and other
factors make the demand location-specific. The upward demand
trend is expected to continue. The pattern of long-term
supplier-customer relationships is expected to continue.
The Asian industrial revolution affects 40%+ of the world's
population and if the Chinese economy slows to a 7% annual
growth it will almost triple in size by 2020.
Aquarian
has taken a strategic investment to position itself to
take advantage of these trends, and has a size and quality
of initial land position that would be difficult to replicate.
It plans to commence exploration and drilling
immediately.
|