Atrum Coal - Panorama North Exploration Update
Sydney, Nov 8, 2016 AEST (ABN Newswire) - Atrum Coal NL ("Atrum" or the "Company") (
ASX:ATU) (ATRCF:OTCMKTS), along with its joint venture partner Japan Oil, Gas and Metals National Corporation ("JOGMEC"), are pleased to provide an operational update for the Company's Panorama North Anthracite Project ("Panorama North"), located in British Columbia, Canada.
HIGHLIGHTS
- Initial drilling program concludes at Panorama North.
- Multiple coal seams intersected at Panorama North.
- Two drill rigs completed 1,180 metres of fully cored diamond drilling in four holes.
- Shallow coal seams were intersected, including a seam with total vertical thickness of 2.30 metres, occurring at 12 metres depth.
- Field work is now complete, and cores are being sent for testing.
Executive Chairman, Mr Bob Bell commented:
"Our first drilling program at Panorama North has been very successful, with multiple coal seams intersected. We are very pleased to have begun exploration of a new region within the extensive Groundhog coalfield, and we have been strongly supported by our joint venture partner JOGMEC and our Aboriginal partners and for that Atrum is very appreciative."
EXPLORATION AND DRILLING AT PANORAMA NORTH
Diamond core drilling of four holes has been successfully completed at Panorama North over the past month. Panorama North is an area to the west of Groundhog North (refer Figure 1 in the link below). Holes have been geophysically logged, and we are now completing studies of the cores and conducting geological interpretation. Samples are also being prepared for testing and analysis.
The coal seam intersections in each drill hole at Panorama North are summarized in Table 1 (see the link below). Two seams within the boreholes have similar geophysical signatures to the Duke E seam, being the primary economic target seam at Groundhog North.
Results from this exploration program are encouraging, and reflect the results of trenching undertaken in the 1980's. Thick, near surface coal seams have been encountered, and the Company will commence planning for the 2017 exploration season, again with support from our joint venture partner, JOGMEC and our Aboriginal partners.
In the 1980's a number of trenches encountered anthracite, but no drilling was undertaken other than shallow auger holes. During 2016, the Company formed a joint venture with JOGMEC in order to undertake a preliminary drilling campaign (refer to ASX Announcement dated 29 August 2016 "Joint Exploration Agreement"). This campaign, over up to three years, is designed to assess the Panorama area for seams that may produce high grade and ultra-high grade anthracite products (refer Figure 2 in the link below).
Over the month of October 2016, JOGMEC and the Company mobilised two drilling rigs and associated geophysical logging equipment to site, and conducted a preliminary drilling campaign (refer Figure 3 in the link below).
JOGMEC is the Japan, Oil, Gas and Metals National Corporation. In 1967, the Japan Petroleum Development Corporation (JPDC) was established to ensure a stable supply of inexpensive oil for Japan. The Corporation was charged with promoting the exploration and development of overseas oil resources - at the time, JPDC provided the necessary funding and liability guarantees for overseas oil exploration. Natural gas was added to its scope of business in 1972. In 1978, under the new name Japan National Oil Corporation (JNOC), it commenced oil stockpiling. As a separate organisation focussed on metals mining, the Metallic Minerals Exploration Financing Agency of Japan was established in 1963 to provide loans for metals exploration. Instead of oil and gas, its role was to ensure a stable, inexpensive supply of metals to Japan. This organisation also got involved in providing financial support for controlling mine pollution caused by the metal mining industry and as a result changed its name to the Metal Mining Agency of Japan (MMAJ) in 1973. In February 2004, JNOC and MMAJ merged to form JOGMEC.
Panorama North is the first anthracite JV for JOGMEC. JOGMEC has formed three coal joint ventures in Australia, two in Canada and one in Indonesia. Japan imported approximately 6.3mt of anthracite in FY15. The key reason for JOGMEC's investment into the anthracite JV with Atrum was to ensure access to anthracite. Anthracite reserves are estimated to constitute only 1% of the world's coal reserves, and development of Panorama North would diversify the supply sources of anthracite, particularly under the recent sharp decrease of anthracite supply in the sea-borne market.
The Company and JOGMEC will now plan a further drilling campaign for Panorama North for 2017, to cover a much wider area, as the preliminary campaign was restricted to a small portion of Panorama North. Re-engagement with our Aboriginal partners in this process will also be undertaken.
With metallurgical coal prices rising, steel mills are looking for costs savings in their production processes. Coke replacement with lump anthracite is an accepted method of reducing input costs for blast furnaces. The buoyant metallurgical coal market has triggered increased interest in the Company's flagship project at Groundhog North. The Company continues to assess low cost options for development of Groundhog North.
To view the release, please visit:
http://abnnewswire.net/lnk/2WK05B96
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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