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CHL - Churchill Mining News Story

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Churchill Mining plc Placing to raise GBP 16.1 million & Mining Reserve

Wed 26th May, 2010 7:00am
TIDMCHL

RNS Number : 5363M
Churchill Mining plc
26 May 2010

?
26 May 2010
CHURCHILL MINING PLC

("Churchill" or "the Company")

Placing to raise GBP 16.1 million and Mining Reserve Update

The Board of Churchill Mining (AIM:CHL) is pleased to announce that it has
raised US$ 23.2 million (GBP 16.1 million) before expenses, through the placing
(the 'Placing') of 16,087,700 new ordinary shares of 1p each ("Placing Shares")
at 100p per share with institutional investors. The proceeds will be used to
advance the East Kutai Coal Project as it moves to development and production
and for general working capital.

Placing Highlights

GBP 16.1 million raised through the placing of 16,087,700 Placing Shares at
100p. The Placing was oversubscribed and the offer size increased to the
maximum number of shares available to be issued under existing authorities

The 16,087,700 new ordinary shares of 1 penny each ("Ordinary Shares") being
issued will represent approximately 16.6 per cent. of the enlarged share capital

The proceeds from the Placing are to be used to advance the East Kutai Coal
Project, as the project moves to the development and production phase, and for
general working capital

Application has been made to the London Stock Exchange for 16,087,700 Ordinary
Shares to be admitted to trading on AIM on 2 June 2010, bringing the Company's
total issued and voting share capital to 96,727,354

The new Ordinary Shares will rank equally with the Company's existing Ordinary
Shares

Astaire Securities acted as sole broker to the Placing

Reserve Update

Following additional analysis undertaken by independent coal geology and mining
specialists SMG Consultants ("SMGC"), Churchill also announces an update to the
JORC Mining Reserve of just under 1 billion tonnes of thermal coal for the EKCP,
in which Churchill Mining has a 75% interest.

The East Kutai Coal Project Geological Reserve statement, compiled by SMG
Consultants, defines the updated reserve as follows:

+--------------------+--------------------+--------------------+
| | Updated | Announced October |
| | | 2009 |
+--------------------+--------------------+--------------------+
| | | |
+--------------------+--------------------+--------------------+
| JORC Mining | 961 million tonnes | 956 million tonnes |
| Reserve | | |
+--------------------+--------------------+--------------------+
| | | |
+--------------------+--------------------+--------------------+
| JORC Resource | | |
+--------------------+--------------------+--------------------+
| Measured | 693 million tonnes | 556 million tonnes |
| | | |
+--------------------+--------------------+--------------------+
| Indicated | 825 million tonnes | 777 million tonnes |
| | | |
+--------------------+--------------------+--------------------+
| Inferred | 1,212 million | 1,149 million |
| | tonnes | tonnes |
+--------------------+--------------------+--------------------+
| Total JORC | 2,730 million | 2,482 million |
| Resource | tonnes | tonnes |
+--------------------+--------------------+--------------------+

Paul Mazak, Managing Director commented:

"I'd like to thank existing shareholders for their exceptionally strong support
in this capital raising. In particular Pala Investments who have contributed
additional funds so as to maintain their current level of equity in the Company
and Advaita Partners, who are involved in the Indian power industry and who have
significantly increased their stake from 8 per cent to 15 per cent of the
enlarged share capital. I also welcome new institutional shareholders to our
register. These funds will help Churchill move into the next phase of our
development of the world class East Kutai Coal Project."

The Placing utilises the Company's existing authorities, and the Placing Shares
equate to 16.6 percent of the Company's enlarged issued share capital.

JORC Statement

This reserve statement confirmed during May 2010 has been prepared in accordance
with the JORC Code 2004.

In accordance with the AIM Guidelines, Mr. Keith Whitchurch of SMG Consultants,
is the qualified person that has reviewed the technical information contained in
this release.

The information in this statement relates to Coal Reserve of the East Kutai Coal
Project and is based on information compiled by Keith Whitchurch, who is a
Member of the Australasian Institute of Mining and Metallurgy, and is employed
as a Principal Engineer by PT SMG Consultants. Keith Whitchurch has sufficient
experience which is relevant to the style of mineralization and type of deposit
under consideration and to the activity which he is undertaking to qualify as a
Competent Person as defined in the 2004 Edition of the "Australasian Code for
Reporting of Mineral Resources and Ore Reserves". Keith Whitchurch has over 25
years experience in planning and mining of coal deposits.


For further information, please contact:
+--------------------------------+----------------+----------------------+
| | | |
| Churchill Mining Plc | Astaire | Pelham Bell |
| Managing Director - Paul | Securities | Pottinger |
| G. Mazak | Corporate | James MacFarlane / |
| +62 81510539186 / | Finance | Charles Vivian |
| +62 21 39832398 | Shane Gallwey | +44 (0) 20 7337 1533 |
| +61 8 6382 3737 | +44(0)20 7448 | or |
| paul.mazak@churchillmining.com | 4474 | +44 (0) 7894462114 |
| | | |
| | Broking | |
| | Jerry Keen | |
| | +44(0)20 7448 | |
| | 4492 | |
| | | |
+--------------------------------+----------------+----------------------+


This information is provided by RNS
The company news service from the London Stock Exchange
END

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