Bussines Plan English Final

7/31/2019 Bussines Plan English Final

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Business Plan

Manganese Mining & Trading

Of East Nusa Tenggara- IndonesiaWest Timor : Republic Of Manganese

Overview:Along with the rapid development of steel industry in

China, Korea, India, Japan and Australia

led to join the growing international

market demand will need a stone

manganese / manganese ore, as a raw

material mix of steel processing from

Indonesia that had been mined in West

and South Sumatra, Lampung,

Tasikmalaya, East Java, and Sulawesi. But

the area for deposits and the quality is

not in accordance with international

standards, is finally doing more intense

research in West Nusa Tenggara and East

Nusa Tenggara.

Since its start late 2007 to early 2008,

began to unfold from the research results

are found in almost all areas ranging from Flores,Sumba ang West Timor-NTT , all contain

manganese stone with quality levels above 44% Mn and by 90%Mn, and deposits are evenly

distributed. (Standard international markets / China ranging from 44% Mn).

As an illustration, according to the International Manganese Institute / IMNI total world

manganese production in 2008 of 15 million tonnes and then fell only 12 million tons in 2009 and

then increased again in 2010 to around 15 million tonnes. Of the total production, China as a major

consumer have to import 11 million mines manganese reserves and their quality is declining.

While the international market price of manganese ore reached a peak in August 2010 ie for

44% Mn content is U.S. $ .383/ton (China market) and then decreased through 2011 of

approximately U.S. $ .286/ton. This means that for manganese ore with Mn content above 44% as

contained in West Timor, it costs more competitve to the international market.

That's why since 2008, investors began to arrive China, Korea, India, Japan and Australia in

the province to try to explore the content of manganese in the province to meet international

market demand and they have been exporting hundreds of thousands of tons of manganese to

China, before the release of Minister of Energy and Mineral Resources.Regulation No. 7/th.2012 on

tightening export of mineral raw materials as well as liability for mineral processing and refining,.


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Manganese at a glance overview of the potential spread evenly in four districts inWest

Timor- NTT province : Kupang Regency, Timor South Central Regency, Timor North Central

Regency and Belu Regency with above average quality of 44% Mn s / d 70% Mn.

NTT previous lack of experiencein the mining sector. Some time ago

there are some companies that try to

explore a marble quarry in the district

of Kupang, TTS and TTU a very small

contribution to regional governments

and local communities. Because of the

mining sector this is something new "in

NTT.

Regulation and

Licensing:

Along with the discovery of manganese great

potential in the region and the arrival of investors in 2008,

the local government both provincial and district levels

are encouraged to send in pursuit to publish a lot of

licensing revenue targets. Release of the data between

2008/2009 of hundreds of Mining permits have been

issued by local governments in the province to mining

entrepreneur who is now a lot of trouble.

After the publication of Act .No.4/Th.2009 onmineral and coal mining/IUP in January 2009 in

conjunction with Government Regulation or PP.

No.23/Th.2010 junction PP. No.22/Th.2010 no longer

issuing new licenses and began the licensing sector reform

and adjustment mining in the province in accordance with

the mandate of the new laws and guidelines that the

Department of Energy is still proceeds today to acquire the

status of "Clear & Cleance" / C & C.

Because it permits almost all IUP Exploration and Production Operation in NTT is now

permits the adjustment of last Mining permitt / Kuasa Pertambangan/KP issued before the

enactment of new legislation. And unfortunately dominated by the license permits the broker /

mafia licenses that are not backed by capital and experience in the mining sector.

As a result, now that there is a "business permit" or a business on paper between the

brokers who hold licenses IUP with the entrepreneurs / investors who really serious to conduct

mining activities is good and right with exorbitant prices.


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As an illustration, in four districts in West Timor, of which

there are so many hundreds of IUP, there are only two companies

that really do that manganese exploration activities PT.Soe

Resourchis Mining Corporation / SMR in Niki Niki South Central

Timor Regency, and PT.Elang Perkasa Kencana in North Central

Timor Regency at Bakitolas . While others, only to trade around

by buying manganese stone excavated from the local

community.

In terms of regulation, which is still open space for a new

license is the license IUP Special to the private sector in cooperation

with local enterprises as well as cooperation with local communities

/ cooperatives for IPR. As for the IUP can only be done in several ways that take over an existingIUP, or Joint Operation / JO.

Current Conditions:

Although many companies in the NTT IUP, but that

really did a good mining activities and is just a few, as

the concession holder is a broker is a broker that is

not supported by capital and experience, in addition

to licensing problems unresolved by the local

government.

Another factor that is also a constraint is the

land where all is the status of land in the province of

customary rights / indigenous and non-certified,

making it difficult for the exemption because tunpang

claims overlap and mutual interest among members

of the clan. For it must use the local people who really

understand about this. On the other hand there are

also issues of spatial problems, because of the overlap

between the forest, residential, agriculture and others.

Since 2011 there began a new trend in which large-scale enterprises to foreign mining

companies from China, Korea and Australia, which had gone public in the country began to acquire

companies in the NTT IUP, although not followed by actual mining activities in the field. These

companies include: Bligh Mining PTY Ltd of Australia has JO by Mighty Eagle group in Timor and

Flores, Western Manganese Ltd, Shanghai Yuanneng Energy, Mining International Rakhsa PT, PT

Benakat Petroleum Corporation, Grace Group. Interchina Holdings Company Ltd, Nickelore Ltd,

Killara Resources Ltd, Soil Sub Technologies Ltd 3D Resources Ltd and others.


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Current state of manganese mining in particular NTT West

Timor is still far from princip princip mining is good and right.

Because mining is mostly done by people and not by the company

IUP. As a result only damage the environment because there is no

post-mining reclamation, there is no assurance on the work of labor

accidents, no corporate contributions to local communities as a social

corporate social responsibility, and further compounded by the lack

of supervision by local government because of the lack of HR mining

dissector.

Since 2008 that occurred in the province is really just practice

good trading manganese delivery to Java as well as the direct exports

to China, Korea and Australia. Practice of employers just bought mine

from the local community and the manual or inter stockpile at the port

of the great collectors collectors. This model can be done by anyone

who has the capital, without having to have IUP, where he can only

hire "flag" / permission of the owners of the IUP to meet trading

requirements such as holding a license, permit the transfer of goods,

to the port and the last permit or export shipments.

One side also has been happening in the trading manganese is

a matter of "coordination" with law enforcement officials are very

difficult the perpetrators of trading, which is considered veryburdensome because it starts from the lowest level that is from the

mouth of the mine, to a stockpile, and then in the harbor and the last in

the sea. Lots of "post post stealth" that must be coordinated for the

safe delivery of goods.

It is also a problem is the issue of port infrastructure is still

very minimal in NTT. Where the loading of infrastructure limitations,

haulage capasity administration and limited ship. Only the port of

Kupang Tenau can disandari ship with a carrying capacity of 10,000

tons and above, while the other ports such as Wini / TTU and Belu Atapupu less than 5000

tons. Although there is no valid data on the amount of manganese that has been explored from NTT,

but from the media since the data recorded from 2008 to present before the enactment of the

Minister of Energy and Mineral Resources No.7/Th, 2012 on the processing and refining the

requirements for holders of IUP and tightening export of raw materials minerals and coal, which

has millions of tons of manganese from NTT explored both for domestic and export purposes.


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Prospects & Opportunities

Still open to mining prospects and opportunities in particular IUP Special concessions to dowith the pattern of cooperation with local government (enterprises/ BUMD)

With the ongoing verification process of IUP in the province to obtain the status of C & C will abort

many of IUP who do not qualify, then the open space of the issuance of new issuance by local

governments

There are still wide open space, which

is woven in collaboration with local

communities / cooperatives to work on the

communities mining sector r/ IPR, because

the potential is huge. Almost part of

production of manganese mining in the

province comes from the excavation of the

people.

Business StrategyBusiness strategies that can be

applied here is the incorporation pattern of

trading and mining. That is, companies are

required to have some of the IUP for

mining activities. However,

cooperation should also be tradingwith or buying the mining mined

people. This will speed up

production and sales target desired

by the company.

Trading on a large scale can

also be made between the owner of

the stockpile at the port of the port. Because not all hoarders in

the port stockpile has a license and adequate capital to make

deliveries to or export of Java. Because it's usually a great

player, just buy from the stockpile stockpile loading which thendirectly to the ship to be sent / export.

Given the necessity of IUP for processing and refining and tightening export, making it

difficult for speculators to trade as long as this occurs. Because they have to send to Java because

there is only smelter processing in Java.

For the NTT until now no single plant manganese ore processing and refining. Because it is

prospective if in one district in western Timor established smelters processing and refining of


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manganese stone, because it will automatically accommodate all existing production.

Manganese prices up 45% Mn in the country (in Attack & Cikampek plant) is in the range of

Rp.2600 -3200/kg. Export prices for China's international market is U.S. $ 286/ton - U.S. $ 383/ton.

Prices are very volatile prices in accordance with the international steel market ups and downs.

Production costs for exports of around U.S. $ .50-

80/ton and shipping costs around U.S. $ .35/ton.

Trading & Mining Experience

To trade in the domestic / export should be in large

numbers, a minimum of 3000 tons. When 3000 tons

were collected only from the purchase of the mine

people take about 2 months and capital expenditure of

about US.$.400.000-450.000. is included for the

coordination and transport in the local districts to

stockpile, coordination, unloading and taxes of aboutUS. 50000-65000. Factory price in Jakarta around

US.$285 US$.350. /MT.)

To mine after having IUP, it should free up land

either rent or cooperate. To lease the land range from

Rp 5 million - 10 million / area or fee for landowners

and Rp.100/kg Rp.100.kg again to the village

administration fee. By using 2 heavy equipment

excavator and 4 units of dump trucks, as well as an

approximately 20-openfit labor system then

generated a month is about 1500-4000 MT.

Operating cost component is salaries, and the solar

industry prices. Will be effective for the long term.

Dual SystemMerger is an ideal pattern. This means that in addition to

mine own also done trading / purchase of the mining

and trading among communities stockpile.Pola can

produce upwards of 5000 tons a month minimum and

will be highly prospective for export. This pattern can be

done by working with people mining cooperative groups

are fostered through the capital, management andmarketing.


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Network and local access.

All of these can be run as the creation of good relations

and access to various local stakeholders, namely local

government officials, law enforcement officials, as well as

component parts of local communities. Because if not it

will display a variety of problems and obstacles. Many

cases of national entrepreneurs entrepreneurs / or

foreigners from outside the NTT

which suffered heavy losses,

because of staffing local staff, who

do not properly understand the ins

and outs of the world kharakteristik

mines and workshops. It must be

recognized that the world is a new

mine in the province. Because it is

still very much its limitations. For example, the lack of

human resources who do not understand the bureaucratic

world of mine / business / private sector, so often clashedabout the regulations, labor issues are also very minimal

skills in the mining sector / industry, and also in regard to

indigenous land status and so on, not to mention the onslaught

onslaught of environmental activists. Nevertheless the prospects

and opportunities manganese mining sector in the province, especially in

West Timor is still very wide open and promising in terms of profit.

. For Information : Ronny Abi ([email protected])

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Bussines Plan English Final