Note 12 - Contingent Liabilities and Contingent assets, page-10

Note 21: Contingent Liabilities
The Group has a number of contingent liabilities in respect of
deferred purchase consideration for the acquisition its mining
and exploration tenements.
At 30 June 2017, the Group’s contingent liabilities total
US$20.70m (30 June 2016: US$24.70m) in respect of its BBM,
PT Borneo Bara Prima (BBP), and TBAR projects. The amounts
are payable on the achievement of certain milestones,
including but not limited to the establishment of certain
JORC Inferred Coal Resources and the issuance of production
operation IUPs (licences) and production forestry permit.
Payments which may be triggered by the
commencement of development at BBM
Deferred purchase consideration
As part of the Group’s acquisition of its interest in the BBM
project, it was agreed an amount of $10.0 million would
be payable within 30 days of the issue of the Production/
Operations IUP (mining license granted under the Indonesian
New Mining Law). On 1 May 2013, the Production/Operations
IUP was granted but the payment to the vendor was deferred
pending the issuance of the Forestry Production Permit
(required to commence the construction and production). On
15 August 2015, Cokal received BBM’s Forestry Production
Permit.
On 3 March 2016, the Group executed a variation letter with
the vendor whereby the parties agreed the obligation for
$10.0 million payment would triggered when Cokal had
sufficient funds to commencement of the construction/
development of the BBM project.
No liability is recognised as at 30 June 2017 in respect this
deferred purchase consideration as the Group had not
secured funding to commence the construction/development
of the BBM project or the start-up BBM Anak project.
As part of the Directors consideration of the ability of the
Group to continue as a going concern (refer note 1 (c)), the
Directors are aware some or all of the deferred consideration
may be triggered by the commencement at the BBM Anak
project. Uncertainty exists as to whether current activity
at BBM Anak meets the condition of the funding of the
development of the BBM project, as anticipated as part of the
3 March 2016 agreement between the parties.
At this time, the Group does not have sufficient funds to
develop the larger BBM project or fund any portion of the
$10.0 million deferred consideration that may be payable. To
the extent monies are required to be paid, the Group will need​

to raise capital to fund these payments.