Cougar Energy has signed a Memorandum of Understanding (MOU) with Indonesian mining company PT Medco Energi Mining International (MedcoEnergi) to assess and identify coal deposits in Indonesia suitable for application of Underground Coal Gasification (UCG) technology, and to undertake the preparation of a preliminary study for their commercial development.
The signing of the MOU is an important step in terms of finnancial recovery for Cougar Energy who have had a number of isues with their UCG projects in Queensland, including the the company's $A500 million UCG pilot plant in Kingaroy, which have been shut-down by the state government resulting in legal action. Cougar energy are suing the Queensland Government and three public servants for $A34 million.
In an address to investors earlier this month Cougar signalled that their sights were now set on developing UCG potential in Asia pinpointing the People's Republic of China, Mongolia and Indonesia specifically as development targets.
The MOU signed between MedcoEnergi and Cougar provides for the potential formation of a joint venture for development of these projects and aligns Cougar Energy with a commercial partner of substance in Indonesia.
MedcoEnergi, based in Jakarta, is a subsidiary of PT Medco Energi Internasional Tbk, a publicly listed company with a range of energy interests including domestic and international oil and gas operations, power generation and the development of downstream industries.
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Both MedcoEnergi and Cougar Energy have agreed that there is an 'immediate need for the provision of cheap and clean sources of power in Indonesia using local coal resources, which would potentially supplement MedcoEnergi affiliate’s current power generation capacity of around 200MW'.
The companies have already identified target coal resources and plan to progress the MOU goals rapidly.
Image caption: Cougar Energy's Kingaroy pilot plant.
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