100% Increased JORC Resources at Groundhog North
Perth, Oct 14, 2014 AEST (ABN Newswire) - Atrum Coal NL ("Atrum" or the "Company") (
ASX:ATU) (ATRCF:OTCMKTS) is pleased to announce an upgrade to the JORC anthracite resources at the Company's flagship Groundhog Anthracite Project ("Groundhog"), located in British Columbia, Canada.
Executive Chairman, Mr James Chisholm commented:
"Our development strategy is simple - we plan to sell down a minority equity stake in Groundhog North in return for complete funding of the first 3Mtpa mine. Subsequent mines can be financed separately through cash flow or traditional debt, positioning the Company for significant growth."
"Groundhog North now has a massive resource base of more than 600Mt of high and ultra-high grade anthracite and this covers only a fraction of the broader Groundhog Coalfield. The expanded resource is being incorporated into the upcoming Supplementary PFS, which in turn will allow the Company to progress with the proposed partial sell-down of Groundhog North. Interest in Groundhog's highly strategic ultra-high grade anthracite is very strong."
GROUNDHOG NORTH RESOURCE UPGRADE
The reportable JORC resources at Groundhog North have increased from 305.2Mt to 609.2Mt, the categories of which are summarised in the table below.
JORC Category Previous Upgraded Resource (Mt) Resource (Mt) Measured 100.1 156.1Indicated 129.1 193.3Inferred 76.0 259.8Total 305.2Mt 609.2Mt
The majority of reported JORC Resources in the Groundhog North area are at a relatively shallow depth of cover. In excess of 80% of Resources are at a depth of less than 300m.
The table below illustrates the depth cut-off of the JORC resource at the Groundhog North Mine:
Depth Measured Indicated Inferred Total (m) (Mt) (Mt) (Mt) (Mt)< 300 143.5 162.6 199.7 505.8> 300 12.6 30.7 60.1 103.4Total by JORC Category 156.1 193.3 259.8 609.2
The following considerations have been used in the estimate of the JORC anthracite resource:
- 200m river setback with resources on the eastern side of the river not included
- Measured resource extrapolated 500m from points of observation
- Indicated resource extrapolated 1,000m from points of observation
- Inferred resource extrapolated 2,000m from points of observation
- Maximum 0.3m stone parting
- Minimum 0.4m mining thickness for open cut mining at <300m depth
- Minimum 1m mining thickness for underground mining at >300m depth
It is noted that the overall strategy at Groundhog North is one of low-impact mining.
A comparison of the potential anthracite specifications (notably carbon) at Groundhog North with Chinese BF Coke, which is an essential input into North Asian blast furnace steel production, indicates an exceptional product in all specification measures. High grade and ultra-high grade anthracite is used in steel manufacturing as an economic and environmentally superior substitute for metallurgical coke. Anthracite is also used in the manufacture of specialty steels and alloys, in electric arc furnaces, for ore sintering, as a reductant and cathode paste and as an economic alternative to graphite.
The recent upgrade of JORC resources at Groundhog North is in part due to the acquisition of Anglo Pacific coal licences (September 2014) located immediately west of the original Groundhog North area. Incorporating these licences allows simpler mine plans, incorporating longer extraction panels.
It is anticipated this will lead to mining efficiencies and an overall reduction in mine OPEX.
A comparison of the estimated anthracite resource as calculated in May 2014 and October 2014 respectively for the Groundhog North area across the various seams is outlined below. The Seam #70 and the Seam #40 demonstrate the greatest increase in estimated resource compared to the previous estimate.
GROUNDHOG NORTH - SUPPLEMENTARY PFS
The Company will release a Supplementary PFS in the coming days based on Groundhog North, which will consider:
- expanded anthracite inventory
- extended mine planning
- optimised surface infrastructure
The initial PFS completed for the first stage of production at Groundhog is based on adit mining of the Seam #70 and the Seam #40 at Groundhog North. This area represents less than 5% of Groundhog and only considers 2 out of 20 potentially mineable anthracite seams. Overall economics are expected to improve with the pending optimisation.
To view all tables and figures, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-ATU-694722.pdf
About Atrum Coal Limited
Atrum Coal Limited (ASX:ATU) is a metallurgical coal developer. The Company flagship asset is the 100%-owned Elan Hard Coking Coal Project in southern Alberta, Canada. Elan hosts large-scale, shallow, thick, hard coking coal (HCC) deposits with a current JORC Resource Estimate of 298 Mt (70 Mt Indicated and 228 Mt Inferred). Comprehensive quality testing of Elan South coal on samples from the 2018 exploration program, combined with review of substantial historical testwork data for the broader Elan Project, has confirmed Tier 1 HCC quality.
The initial focus for development is the Elan South area, which is located approximately 13 km from an existing rail line with significant excess capacity, providing direct rail access to export terminals in Vancouver and Prince Rupert. Elan South shares its southern boundary with Riversdale Resources Grassy Mountain Project, which is in the final permitting stage for a 4.5 Mtpa open-cut HCC operation. Around 30km to the west, Teck Resources operates five mines (the Elk Valley complex) producing approximately 25 Mtpa of premium HCC for the seaborne market.
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