Metallica Minerals Limited (ASX:MLM)
Brisbane, May 28, 2009 AEST (ABN Newswire) - An initial resource of 171.7 million tonnes has been announced for the underground coal gasification (UCG) project being developed by MetroCoal Limited in the Surat Basin northwest of Brisbane.
The JORC-compliant Inferred and Indicated Resource estimate was prepared following a successful 16 hole drilling program completed recently at Juandah Prospect by MetroCoal, an 84% owned subsidiary of, Metallica Minerals Limited (ASX:MLM).
The drilling campaign delineated the target Macalister Upper Seam in all 16 boreholes and is continuous and correlateable across the drilled area, generating the resource estimate announced today, and which comprises:
Juandah Project Macalister Upper Coal Seam Resource
--------------------------------------- Inferred Resource 149.2Mt Indicated Resource 22.5Mt Inferred & Indicated 171.7Mt---------------------------------------
This resource comfortably exceeds MetroCoal's 100Mt target required to support a major UCG project producing 20,000 barrels a day of high quality, cleaner liquid fuels. There is also significant scope to increase the resource in areas where the Macalister Lower Seam coalesce with the Macalister Upper creating potential working sections up to 12 metres thick. Further drilling is planned in these areas and in the remaining, undrilled area of the MDLA to better define coal quality and areas of thickened and coalesced Macalister Seams.
The Juandah Project in MDLA 406, covers 60km2 with the coal seam encountered at depths within the target area of between 150 to 350 metres below surface - ideal depths for UCG. The Indicated Resource component was defined in the southeast corner of MDLA 406.
The initial JORC Code resource is a favourable result as only a very small portion of MetroCoal's tenement coverage was involved in the drilling.
The indicated coal resource has been defined in the south east corner of MDLA 406 where core drilling has been completed.
Coal quality appears typical of Surat Basin coals with laboratory analysis showing insitu specific energy of the working sections averaging 20.6 MJ/kg on an air dried basis. Further drilling is planned to extend the area (and improve resource status and confidence) as well as increase resources.
The JORC Code resource announced today supports MetroCoal's growth strategy to establish significant Surat Basin coal deposits within its 4,000km2 tenement area, suitable for both:-
- Underground Coal Gasification (UCG) and
- Conventional underground and open pit coal mining.
Coal resource estimation has been carried out over the Juandah Project Area in accordance with the JORC Code. The inferred resource estimate is based on points of observation no more than 4km apart and not exceeding 1km past the last data point. The indicated resource estimate is based on points of observation no more than 1km apart. The working section used comprises the MU10, MU20, MU30, MU40 and MU50 ply's of the Macalister Upper Seam. The Macalister Lower Seam and all uncorrelated coal has been excluded from the resource estimate.
Drill holes which were classified as valid points of observation for determining resource estimations are summarised as follows:
- The entire Macalister Upper (Mu) seam was drilled
- Borehole contained slimline density geophysics
- If cored, core recovery was greater than 95%
- Ash and RD analysis as a minimum were taken on cored holes
Other limiting parameters were applied to the resource estimate, and are summarised as follows:
- Minimum seam thickness of 2m
- Minimum depth of cover greater than 150m (i.e. for UCG > 150m depth)
- Maximum in seam stone parting of 0.5m
- Maximum ash limit of up to 50% raw ash
Contact
Mr Andrew Gillies
Managing Director
Metallica Minerals Ltd
Ph: +61-7-3891-9611
Mob: +61-416-137-556
Mr Mike O'Brien
CEO, MetroCoal Ltd
Ph: +61-7-3891-9611
Mob: +61-419-599-523
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