Coal news and updates

A-Cap Resources (ASX:ACB) has defined a maiden JORC Resource of 148 million tonnes of thermal coal in situ at the Foley prospect of its Bolau Coal Project in Botswana.

 

Adding to the interest, this includes an Indicated Resource of 71Mt, well above the 25Mt the company had sought to identify.

 

Drilling has also identified a Resource of 66.6Mt in the SS Seam at an average yield of 78.25% that is suitable for meeting current specifications used for power elsewhere in southern Africa.

 

The Bolau Project is adjacent to African Energy Resources’ (ASX:AFR) 2.5 billion tonne Sese Coal Project.

 

The Foley deposit is shallow with a maximum seam depth of 57 metres and is within close proximity to road, rail and power with no settlements within the resource area.

 

Coal is suitable for feed without beneficiation for specifically designed domestic power station.

 

Drilling targeted a small area of the prospective area indicating the potential for resource growth in line with expanding infrastructure.

 

Further evaluation work on the resource and potential reserves and its quality and development options are progressing with Sedgman South Africa.

 

“A‐Cap’s focus was to fast track this deposit to mining studies, by drilling out a small portion or the prospective area to identify at least 25 million tonnes of Indicated Resource,” chief executive officer Paul Thomson said.

 

“This recently completed drilling program has achieved the targeted tonnages and added significant value to the Foley prospect. 

 

“The quantum of the Indicated coal Resource is enough to support an initial mine life for both an export scenario at one million tonnes per annum and a supply source for a coal‐fired power station. 

 

“Current infrastructure constraints in Botswana will allow one to two million tonnes per annum projects to come on line in the short term, if the commodity price is right. 

 

“Later as the infrastructure capacity in Botswana grows, the coal resource on our tenements still has the potential to grow with it as we still retain significant exploration potential.”

 

 

Bolau Coal Project

 

The Bolau Coal Project encircles the 2.5 billion tonne Sese Coal Project and includes coal horizons that appear to be on the up dip and down dip extensions of Sese.

 

In May, the Bolau Coal Study by Sedgman South Africa recommended further drilling and test work.

 

The recently completed drilling program followed this recommendation with a focus on defining an Indicated Resource on the basal seam of the shallow up dip extension of Sese (Foley) and the down dip extension known as Bolau.

 

Initial efforts were focused on Foley with all seven holes intersecting the coal sequence hosting the Sese Main Seam, which is made up of the basal SS Seam, the SST Seam and SSU Seam.

 

This package totals about 20 metres thick.

 

Testwork indicated the potential for the SS Seam to be suitable for raw feed to a power plant.

 

Once beneficiated, the quality of the coal improves to a potential export product, with increased calorific value, lower total sulphur and a promising yield. 

 

Yields range from 66.8% to 85.7% at a 1.70 float fraction.

 

 

Analysis

 

Drilling has delineated an Indicated Coal Resource at Foley that allows A-Cap to fast track this project towards development.

 

Adding to the interest, the resource size is now large enough to allow a meaningful mine life to be considered.

 

The resource also has the potential to be supplied as raw feed to a local power station and can be beneficiated for consumption in southern Africa and the seaborne coal market.

 

It is progressing the project with Sedgman to look at potential mining studies and markets within the bounds of forecast coal prices.

 

Given that drilling was carried out on a small part of the Bolau Project, there is substantial potential for further resource growth as transport infrastructure improves.

 

The Botswana Government has paved the way for future infrastructure upgrades in the short term to Richards Bay and has recently signed the Trans Kalahari Railway (TKR) agreement with Namibia to deliver a dedicated high volume rail to Walvis Bay, with feasibility studies currently underway.

 

The government and industry are also proactively engaging the Mozambique and Republic of South Africa rail entities regarding further increases in capacity.

 

 

 

 

Source: http://www.proactiveinvestors.com.au/