July 24, 2014
Moreton Resources’ coals reserves at Coolabunia have the quality and tonnage “to sustain a substantial, long-term mining operation”, the ASX was told today.
In a statement to the Exchange, Moreton CEO Jason Elks said the results from tests in 42 new holes across the holding had been analysed by an independent consultant.
They showed the “indicated and inferred” coal in the area could be upgraded 200 per cent.
The consultants had estimated a total coal resource of 221.2MT within the tenement (including 122.3MT measured and 82.5MT indicated); up from the previous level of 73MT (indicated and inferred).
Mr Elks said Moreton Resources would now move to finalise its preliminary Mine Concept Study to determine how much of the area could be converted into a mining reserve and at what strip ratio.
“Following which, the company will be in a position to further assess the commercial viability of any decision to further advance the project,” Mr Elks said.
Moreton hopes to be able to deliver coal suitable for power generation at Tarong at a lower cost than the adjacent Meandu mine.
“We believe the work currently being carried out will demonstrate that there is a commercial case to consider the (Moreton) asset as a potential alternative supply, be it with the current operator (of Tarong) or a future operator through divestment of power generation assets,” Mr Elks said.
“(Moreton) is aware that the incumbent power generator, Stanwell Corporation, states it has sufficient coal to supply the Tarong Power Stations up until at least 2035.”
He said the company had not entered into commercial negotiations with Stanwell – or approached any potential acquirer – other than to advise of Moreton’s progress.
Mr Elks said a key component of any decision-making would be community engagement and environmental concerns.
“However this is a contemplative project at this stage and is by no means an imminent proposition.
“We certainly have staff regularly attending the Kingaroy region and talking with stakeholders in a staged process about our activities around community and environment.”
Moreton Resources is the restructured company formed after the failure of Cougar Energy’s underground coal gasification trial at Coolabunia.
Mr Elks said that notwithstanding the potential for a coal mine on the site, the new Board of the company remained committed to dismantling and removing the UCG plant and fulfilling its environmental responsibilities.