The company with the proceeds from the sale plans to clear an outstanding debt of $1b acquired in 2011 from Standard Chartered Bank.

An informed source was quoted by Reuters as saying that Borneo expects to close the divesture by December 2012.

Borneo co-director Kenneth Allan also said that, "It’s an ongoing process. We are talking to several potential parties, which are conducting due diligence, but no binding commitment yet."

According to Allan, Borneo seeks a strategic partner with the technical and market expertise to assist the company to develop its coal business.

The Tuhup mine is located in the Muara Raya Regency in Central Kalimantan Province, Indonesia, where Borneo has explored and developed a concession area covering 1,500ha.