In November I had a conversation with Nils Ollquist CEO, President of Borneo Resource Investments, LLC (Symbol: BRNE.pk) and George Matin the BRNE contact at OFS Capital Group; I liked what I heard. A few days ago I spoke with Scott Chaykin, Borneo’s CFO and I encourage anyone interested in Borneo to contact Mr.Chaykin Matin with questions at (425) 329-2622.
I have been accumulating shares of BRNE for some time now (since before the reverse merger) and think the story has finally come together. Matin told me that:
1. An IR-PR firm has been hired and will begin to educate the investing public on the potential of BRNE. Matin told me that the company would likely start putting out information just after Thanksgiving.
2. BRNE is working to become Fully Reporting and that should be accomplished within the next 6-weeks or so...likely between Thanksgiving and Christmas.
3. Once fully-reporting status has been obtained the company will Up-List to the QB or QX Exchange. More than likely that up-listing will happen in January.
4. Once up-listed the company will make application to become listed on NASDAQ and that the up-listing to NASDAQ should be in place during the 2nd Quarter of 2012.
One of the exciting things about BRNE is that they are in Indonesia and have been acquiring property for coal production. At the end of this update is a recent PR released about a month ago. Here is an excerpt from that PR: "The first agreement is for the mining rights on a 1,300 hectare property which the Company believes, pending a final geological study, contains estimated coal reserves of 8 million tons. The second agreement is a memorandum of understanding for the mining rights for an additional 2,000 hectare property, which the Company believes will contain over 12 million tons in estimated coal reserves. Given the current median market price of steaming coal of approximately $50 per ton, the coal located on these two properties, prior to the costs of extraction and shipping, could possibly exceed $1 billion."
One hectare is equal to about 2.47 Acres. What I have learned is that the company plans to acquire more properties in Indonesia for supply to high growth economies in Asia, particularly India and China.. A few things we can count on is that rapidly growing Asian economies will need more power; Coal will be a major need going forward.
Investment Highlights:
- Borneo Resource Investments Limited (“Borneo Resource”) engages in acquisition of thermal coal mining licenses in Kalimantan Indonesia and coal trading.
- Based in Washington, USA, Borneo Resource is US public reporting company traded on US over the counter market. The trading symbol is “BRNE”
- Borneo Resource currently controls 2 high quality mining concessions with operating licenses covering a total area of 7,300 hectares (approx. 18,000 acres) and estimated reserves of 48 million metric tons. thermal coal reserves.
- The Company’s coal reserves contain thermal coal that is primarily used for power generation. With rapid economic growth in both China and India (combined population 2.7 billion), demand for power is growing exponentially. Both China and India are major thermal coal importers and are actively seeking to acquire stockpiles of coal to supply future needs, so the price of coal is expected to continue rising.
- In addition to its existing properties, The Company currently has a pipeline of 6 concessions encompassing 84,000 hectares with estimated reserves of 400 million metric tons
- Based on its existing concession portfolio, Borneo Resource’s net asset value per share is calculated to be approximately $35. The potential capital gain is tremendous.
Existing Concessions:
- PT Chaya Meratus, Kalimantan
- Estimated reserves of 40 million metric tons
- Property size(following upgrade of production license) 6,000 hectares
- PT Integra Prima, Kalimantan
- Estimated reserves of 8 million metric tons
- Property size, 1,300 hectares
- Based on existing market price of around $60 per ton, estimated value of Borneo resource’s existing reserves would be $2.5 billion or US$35 per shares。
Six concession, (license,) properties comprising a total of 84,000 hectares of prime coal bearing property with estimated reserves of approximately 400,000 metric tons.
Revenue Projection:
The Company is currently negotiating on the sale of a 120,000 ton shipment of medium quality coal which will generate gross profit of around $3 million, anticipated to close before the end of 2011.
Borneo Resource’s growth strategy
- Borneo Resource’s asset growth strategy is by acquisition of existing concessions for exploration and production of thermal coal in Kalimantan, Indonesia.
- The Company’s near term revenue strategy is based on trading stocks of thermal coal from the Kalimantan region, capitalizing on robust demand from China and India。
- Borneo Resource has a strong relationship base and political connections in Kalimantan, essential for sourcing of attractive concession opportunities。
- Borneo’s key management consists of experienced mining professionals, including Australian trained mining geologists, investment bankers and private equity investors. The Company also has an on-the –ground team in Kalimantan for project evaluation and due diligence.
- The Company aims to maximize its shareholder’s value by leveraging its professional expertise in the mining and resources industries with extensive capital markets experience and, most importantly, capitalizing on its ability to acquire valuable concession assets at attractive cost through its strong relationship base in the region。
Nils Ollquist, Chairman/CEO
Former head of M&A at Bank of America in US and Hong Kong, founder of US listed Orient Packaging Limited, former advisor to the holding company of Umami Sustainable Seafood Inc. A US publicly company, former advisor to Tulla Resources, a major Australian coal mining and resource company. Listed on ASX。
Carlo Muaja, Director/COO
Qualified CPA, Former commercial banker at Chase Manhattan Bank, Indonesia, with focus on FX trading and mining/resource advisory. Spent 2 years as in auditing in California
Scott Chaykin, CFO
Licensed US CPA and former CFO of various US public companies
Nicholas Bryan, Director
Former Executive Director of HSBC and Head of Global Settlements
Grace S J Sarendatu, Legal and Notary public
Indonesia certified public notary and legal advisory specializes in mining/resources negotiation, due diligence and investment execution.
I like this company a lot and I plan to continue accumulating shares of BRNE with my personal share-price target focused on $12 - $15 within three years. Shares of BRNE Closed at: $1.60 yesterday, November 8, 2011. In my opinion, Borneo is a real company with real assets and should do well going forward.
Charles
NEWS RELEASE (referred to on page one):
BOTHELL, Wash., Oct. 12, 2011 /PRNewswire/ -- Borneo Resource Investments Ltd. (OTCPK: BRNE), a Company that recently acquired Interich International Limited and changed its name from Aventura Resorts, Inc., announced, that as part of the ongoing implementation of its strategy of acquiring natural resources in the Kalimantan Province of the Republic of Indonesia, it has signed two new significant agreements to acquire properties with coal reserves.
These agreements have been entered into by Interich International Limited. The first agreement is for the mining rights on a 1,300 hectare property which the Company believes, pending a final geological study, contains estimated coal reserves of 8 million tons. The second agreement is a memorandum of understanding for the mining rights for an additional 2,000 hectare property, which the Company believes will contain over 12 million tons in estimated coal reserves. Given the current median market price of steaming coal of approximately $50 per ton, the coal located on these two properties, prior to the costs of extraction and shipping, could possibly exceed $1 billion. Both properties currently have both mining and production licenses, and will be able to export the coal from Indonesia. The Company indicated that as it acquires the mining rights for properties and conduct the necessary geological surveys, it will disclose the proven levels of the properties reserve estimates utilizing international standards. The Company has retained the services of an international mining geology firm in Jakarta, Indonesia to start this process.
The Company has initiated discussions with potential strategic partners in Europe, Asia and Australia to bring in additional capital and expertise to our mining platform. These strategic partners may invest in infrastructure for the properties under its control, both for mining and construction of onsite power generation facilities, to take advantage of the high quality coal located on its properties. This will significantly reduce the capital requirements that development of the properties would otherwise impose in exchange for revenue sharing for the coal mined and power produced.
In the process of conducting geological studies and establishing operations in Indonesia, the Company also gained access to significant quantities of coal which it will monetize. The Company projects that its first trade will be on approximately 120,000 tons of medium quality coal which will be sold to an Indian end user. This initiative should result in the generation of revenue by the end of 2011. These opportunities will enable a trading business to be operated in parallel to the acquisition and development of mining properties.
Even as the Company focuses on thermal coal, to the extent that its coal concessions are heavily forested (Kalimantan contains some of the largest reserves of tropical rain forest outside the Amazon), timber licenses will be obtained so that in the early stages of the development of the coal concessions the timber can be harvested using sustainable harvesting practices. Revenue from such timber sales will provide funding for mining operations and enhance the Company's profits.
"We have very strong relationships in Kalimantan and I am pleased that they are providing us with access to extraordinary opportunities in the region," said Nils Ollquist, CEO and President of Borneo Resource Investments. Mr. Ollquist further stated that, "We will continue to build value for our shareholders by not only increasing our holdings in the region, but also by increasing our visibility and transparency with our shareholders."
The Company's corporate activities continue to move forward. The Company is building its management team and Board of Directors. In anticipation of filing a Form 10 with the Securities and Exchange Commission before the end of 2011, the Company is the process of being audited and preparing the necessary documents. Mr. Ollquist noted, "Our ultimate goal is to list our shares on a national securities exchange in the United States and our actions over the last several months will bring us closer to that goal."
About Borneo Resource Investments Ltd. (BRNE).
With its international headquarters in the Seattle, Washington area, Borneo Resource Investments Ltd. through its wholly-owned subsidiary Interich International Ltd, obtains mining concessions to explore and develop coal reserves in the East Kalimantan region of the Republic of Indonesia.
Borneo Resource Investments Ltd. Makes Investments in Properties With Coal Reserves - Yahoo! Finance
LATEST FACT SHEET INFORMATION:
Trading symbol: BRNE (OTC)
Borneo Resource Investments Ltd.
19125 North Creek Parkway
Bothell, WA 98011
Phone .425.329.2622
Fax .408.580.8434
Email: info@borneore.com
Borneo Resource Investments (BRNE.PK)
Overview December 2011
Borneo Resource Investments is a US publicly‐traded resource project generator, which through and with its wholly-owned subsidiary, Interich International, controls resource concessions and licenses indicated to contain substantial reserves of thermal (steaming) coal. The concessions are located in Kalimantan province, on the island of Borneo, Republic of Indonesia.
“High-Quality Steaming Coal in Indonesia”
Market Opportunity
Indonesia has just had its credit rating raised to “investment grade” by Fitch after 14 years. This opens up the country to higher levels of Foreign Direct Investment (FDI), most of which will inevitably flow into natural resources.
The Directorate of Coal of the Indonesian Ministry of Energy and Mineral Resources has estimated that the total deposits of coal in the Kalimantan province exceed 21.1 billion metric tons. The quality of coal in the region is
generally excellent, with a high calorific (heating) value and relatively low ash and sulfur content. The coal is suitable for use as the key component of the power generation industry in India and China, where governments are actively looking to diversify away from the use of lower quality, highly pollutive coal.
Indonesia's geographic location makes it ideally suited to provide supply into two
of the world's largest coal consuming economies.
· Both India and China have targeted significant expansion of their power networks with thermal coal fired power stations. It is estimated that India alone will need to construct over two hundred and fifty, 100‐150 MW power stations in the next 3 years to meet projected energy demands;
· The Indian and Chinese Governments have been attempting to build reserves of thermal coal to meet demand and secure long term supply contracts to even out price fluctuations. This strategy has resulted in steadily increasing prices for high quality coal to around US$100‐125 per metric ton;
· Global investment in energy technologies has expanded by 60% to over US$92 Billion.
The Company targets concessions for which at least a preliminary reserve estimate has been completed.
Following acquisition of a concession, the Company will commission accredited mining engineering reports and submit to appropriate industry bodies (such as JORC in Australia) for review and confirmation of the geology to the level of internationally-recognized standards. This will provide stakeholders and customers with the assurances they need to properly evaluate the company and its assets/concessions.
Competitive Advantage
Kalimantan province, situated in the island of Borneo, Republic of Indonesia is home to one of the richest deposits of thermal coal in the world.
Borneo Resources seeks to create value for its shareholders by identifying discoveries that it will JV or sell to major mining corporations. The Company has adopted a business model that minimizes this financial risk and maximizes the chance of monetizing an ore body.
The Indonesian government has, for many years, been awarding coal mining exploration and licenses to local indigenous groups. The Company has strong connections to this group, including key executive appointments, thereby creating preferential access to these concession opportunities.
Assets
Since its inception, the Company has acquired two excellent concesions. The first is an 80% interest in PT Chaya Meratus Primecoal (“Meratus”), an Indonesian company holding exclusive exploration and development rights for up to 6,000 hectares in the Tanjung Area Basin of south east Kalimantan province.
The second is an exploration and production license covering 1,300 hectares in the Kalimantan province through an agreement with the concession holder, PT Integra Prime Coal (“Integra”).
The estimated present value of Borneo’s initial coal reserves are approximately US$1.2 - 1.4 billion applying a conservative pricing structure of US$100 per metric ton on the Company's estimated current level of reserves of 12 14 million metric tons (‐ currenlty non-JORC compliant).
The Company is currently negotiating to acquire additional steaming coal concessions of 98,000 hectares. If successful, the Company will be one of the largest concession owners in the Kalimantan province, making it a prime target for potential joint ventures (JV) or acquisition.
In addition to its coal reserves, management has established a coal trading operation which will aggregate smaller volumes of coal produced by regional mines for sale to strategic international buyers in India and China. The first trading contract for a 120,000 metric ton shipment has been secured and is expected to close before the end of Q1 2012.
Strategy for Growth
The Company’s operational strategy is predicated on the further acquisition of thermal coal deposits in the Kalimantan province, with the goal of building one of the largest collections of thermal coal concessions in the region. To that end, the Company is currently reviewing offers on a number of additional concessions with
detailed mining studies and full exploration, production and export licenses.
By adopting the project generator business model, Borneo Resources leverages its ability to generate potential projects, while partnering with companies better positioned and able to raise the capital required to develop world-class thermal coal deposits. In financial terms, this leverage significantly multiplies each dollar spent by Borneo Resources.
Borneo Resources itself is required to raise relatively small amounts of capital through equity financing, thus minimizing shareholder dilution. This capital is used to fund exploration, acquisition of mineral rights and marketing. Once the geological potential has been demonstrated and mineral rights are secured, Borneo Resources finds business partners that will invest in the project through earn-in joint venture agreements and non-recourse financing.
Public Company Stats
Ticker: BRNE
SIC Code: 1220
State of Incorporation: Nevada
Fiscal Year End: 12/31
Price (12/16/2011): $3.00
52-wk High/Low: $0.11/$5.00
Shares Outstanding: 70,525,205
Shares Auth. (Preferred): 100 million
Shares Auth. (Common): 400 million
Float: ~7.1 million
Market Capitalization: ~$210 million
Investor Relations contact
Mark Moline
Cinapsys, Inc.
Phone: 760-208-1894
Fax: 949-861-6388
http://www.cinapsys.com
Management
Nils Ollquist, Chairman/CEO
Mr. Ollquist has over 30 years of international banking and corporate finance experience, including several years as a specialist project and resource finance manager with a major European bank. He has extensive experience in coal and iron ore financing in his native Australia. He began his career in the Australian Treasury where he was involved in International Capital Markets issues and infrastructure financing. During this time he also served as Senior Executive Assistant to the Secretary to the Treasury, Sir Frederick Wheeler.
Mr. Ollquist has worked for a major resources bank in Amsterdam, and in corporate finance in New York, Los Angeles, Hong Kong and Sydney. He was an early investor in China, founding Orient Packaging Holdings in Wuhan, China in 1997, subsequently listed in the US and ultimately sold to a Canadian-listed forest products group. Mr. Ollquist has been doing business in Indonesia since 1993.
R. Scott Chaykin, CFO
Mr. Chaykin is a US CPA with over 30 years of hands-on experience in financial and administrative management, corporate structuring and compliance, including strategic planning, operations, financial modeling, sales and marketing.
He has expertise in regulatory affairs, risk management, human resources, management accounting, and public
company reporting.
Carlo Muaja, COO and Director
Mr. Muaja is an Indonesian national based in Hong Kong. He was born in East Kalimantan, Indonesia and was educated in Asia and the US. He has a mining industry and accounting background.
Mr. Muaja has a strong network of relationships, both within government and the private sector in Indonesia, and is responsible for development and execution of the Company’s concession acquisition strategy.
Disclaimer
Statements made in this Report which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and business of Borneo Resource Investments, Ltd. including, without limitation, (i) their ability to successfully implement the business plan and their ability to retain concessions, relationships with contractors, vendors, individual representatives and/or government agencies; and (ii) statements preceded by, followed by or that include the words "may", "would", "could", "should", "expects", "projects", "anticipates", "believes", "estimates", "plans", "intends", "targets" or similar expressions. This report was produced from information provided by the
Company or otherwise available in publicly available resources. The information herein is believed to be reliable but is not warranted as such. You should perform your own due diligence to verify any material information presented herein, and review the Company’s public filings. This document is not a recommendation to buy or sell any securities.
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