- Cokal (CKA) opens red on the ASX today after facing some delays around constructing a road to its flagship Bumi Barito Mineral (BBM) mine in Indonesia
- The road has reached the Mohing River, but recent heavy rainfall made access to the area impossible, meaning materials to build a needed bridge could not be delivered
- However, Cokal says it offset this delay by bringing other construction work along the road up to Mohing River forward in the meantime
- The company says materials supply to construct the Mohing River bridge and culvert has now resumed following the weather delay
- Shares in Cokal are down 5.71 per cent and trading at 16 cents each at 10:10 am AEDT
Coal company Cokal (CKA) has opened red on the ASX today after facing some delays around constructing a road to its flagship Bumi Barito Mineral (BBM) mine in Indonesia.
The company told investors this morning road construction has reached the Mohing River, but recent heavy rainfall made access to the area impossible. As such, contractors could not deliver the materials needed to build the biggest bridge for the planned road.
Nevertheless, Cokal said after the delay, materials supply had now resumed to the Mohing River area.
What’s more, Cokal said during the bridge construction delay, it deployed extra equipment to widen the road up to the Mohing River, reduce road gradients, spread sub-base rock, compact the sub-base and improve drainage to the final standard.
These were all necessary activities planned for after the road was constructed to access the mining area, but Cokal brought the work forward to effectively offset the delays from the heavy rainfall.
Cokal said once the Mohing River bridge and culvert have been built, there is only one more major bridge to be constructed along the road.
Importantly, Cokal said the most difficult section of the road’s reconstruction has been achieved.
Cokal is working to increase access to the BBM coal mining areas, with the 98-km road more than halfway complete. The company said 52km of road was already in use by Cokal and one other mining company.
Cokal said it would have exclusive access to the remaining 46km of road, which used to be a logging road. Cokal is busy upgrading this section of road to be suitable for coal haulage in 30-tonne trucks to the Barito River port at Batu Luhung.
According to the company, fully loaded trucks — weighing over 80 tonnes and above — have passed over finished sections of the road while delivering building materials and not left any tyre intentions.
The company said this was a good sign that the road can become an all-weather road after gravel is applied, able to be used 24 hours a day every month of the year.
Shares in Cokal were down 5.71 per cent and trading at 16 cents each at 10:10 am AEDT. The company has a $150 million market cap.