September 23, 2015
Moreton Resources announced on Wednesday that it has entered into a binding agreement to buy Cockatoo Coal’s Kingaroy coal tenement.
In a statement to the ASX, Moreton CEO Jason Elks said Cockatoo’s coal permit exploration area, known as EPC 882, was next to Moreton’s MDL 385 asset – the area which it is currently being assessed for the development of a coal mine.
“The Board of Moreton Resources has been seeking to identify strategic access areas to assist with the development of MDL 385, and as such this acquisition will potentially alleviate any concerns as to overrun with footprint of our potential site layout, that may eventuate from the outcome of our formal Pre-Feasibility Study (PFS) process,” Mr Elks said.
“Once the purchase of this asset is fully complete the market will be updated on the finalisation of this transfer.
“This transaction is fully funded from within current cash reserves within the company.”
According to previous information released by Cockatoo, EPC 882 has a measured 35.3 MT of coal, with an indicated level of 128.3 MT and an inferred 115 MT.
Cockatoo Coal CEO Peter Kane said the transaction was subject to the satisfaction of relevant government approvals and the finalisation of due diligence.
“The sale of this non-core asset aligns with Cockatoo’s strategy of focusing on the expansion of its flagship metallurgical coal mine at Baralaba,” he said.
Moreton and Cockatoo have had dealings going back to before Cougar Energy’s failed UCG project.
In July 2007, Cockatoo Coal acquired Metallica Minerals which included a 100 per cent interest in Metallica’s Kingaroy project (EPC 882) and a 20 per cent stake in Cougar Energy’s UCG project at Coolabunia (now Moreton Resources).
In 2008, Cockatoo swapped its stake in the UCG project for 15 million Cougar shares as underground coal gasification did not fit with its core business objectives of coal exploration, development and mining. This occurred well before the pilot burn and the suspension of the UCG project.
This is the second expansion bid outside MDL 385 that Moreton has done this year.
In July, Moreton applied for a mineral exploration permit, EPM 25992, for another area near its MDL 385 asset.
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Footnote: MDL = Mineral Development Licence; EPC = Exploration Permit Coal; EPM = Exploration Permit Minerals (Other Than Coal)