(EnergyAsia, May 5 2011, Thursday) — PHI Energy Corporation, a minority owned subsidiary of US-based PHI Group Inc, said it and AXN Group LLC have agreed to jointly purchase coal mine assets from Indonesia’s PT Dian Anugrah Pratama (DAP). PHI Group is engaged in merger and acquisition advisory services, real estate development, and mining and energy investments.

PHI Energy Corporation will acquire an estimated mineable coal reserve of 10 million metric tons located on a 423-hectare site in Sumatera Barat in Indonesia from DAP in exchange for 20 million PHI Energy shares valued at US$1 each.

According to sample analysis, the coal assets show ash content of 10.66%, total sulphur 0.97%, total moisture 4.78%, volatile matter 46.36%, fixed carbon 41.43% and caloric value of 7,338 kilo calorie per kg.

The transaction is scheduled to close on May 7, with PHI Energy filing a registration statement with the US Securities and Exchange Commission within 90 days to become a fully reporting publicly traded company.

PHI Energy said it has agreed to issue additional shares to DAP to ensure that the Indonesian company’s holding will be equal to a minimum of $20 million if PHI’s stock price closed below US$1 during the first 60 days of the initial effective trading of its common stock.

Herman Koswara, a DAP director, said: “We are pleased to participate in PHI Energy Corp’s growth strategy through this relationship and look forward to creating substantial value for all parties involved.”

Allen Wu, PHI Energy Corp chairman, said: “The acquisition of the DAP coal assets is the first step of our plan to engage sizable sources of coal supply to meet the demand of potential long-term off-take contracts. We are confident that this transaction will bring significant economic benefits to our shareholders.”

Founded originally in 2005 as Providential Oil & Gas Inc, PHI Energy Corporation has been engaged in oil and gas joint ventures with various U.S. companies in Texas and California. The company is a majority-owned subsidiary of AXN Group LLC, a global investor in natural resources sector, encompassing oil & gas, forestry/timber, and mining.

Coal miner and trader PT Dian Anugrah Pratama owns mines in West Sumatra with estimated reserve about 40 million metric tons.