Stanmore Coal - Kerlong project

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Kerlong location plan

Location: 19km north-east of Moranbah
Area: 41km²
Target: superior underground PCI/coking coal
EPC's: 1552, 1769, 2176
Ownership: 100% Stanmore Coal

Potential for superior underground PCI/coking coal deposit – Coal quality data from nearby exploration points to the potential for a high quality PCI and coking coal to be produced from the targeted Leichhardt and Vermont seams. Exploration to the south, east and north-east of the project indicates the Leichhardt Seam to be from 1.4metres to 7.0metres in thickness with raw ash levels as low as 10 percent and volatile matter content between 10 and 20 percent. Reflectance values are high at around 1.25 percent. In the nearest of the historical drill holes (Grosvenor NS 9), the Leichhardt Seam occurs at a thickness of 4.6metres with a raw ash of 14 percent and volatile matter content of 20 percent (which washed to 10 percent ash at a 90 percent yield).

The Leichhardt seam which is targeted in the Kerlong Project forms part of the Rangal Coal Measures and is mined extensively in the surrounding area. This seam is capable of producing a prime PCI coal and possibly a prime coking coal such as that produced at the nearby Carborough Downs Mine (Vale). The seam is mined at a number of other surrounding mines including Burton (Peabody), South Walker Creek (BMA) and Coppabella (Macarthur Coal).

Close to Infrastructure – the project area lies 10 kilometres north of the Peak Downs Highway and eight kilometres north of the rail line to the Dalrymple Bay Coal Terminal.

Exploration History and Geology

While there has been no previous drilling within the project area, regional drilling by the Geological Survey of Queensland (GSQ) in the 1970s investigated the Rangal Coal Measures in the region. In addition, CH4 (now Arrow Energy) and other companies have drilled a number of gas holes along the eastern side of the Carborough Range to the east of EPC 1657 and at Ellensfield to the west. The project is located on the axial portion and western limb of a northerly trending synclinal structure. The Clematis Sandstone and Rewan Formation are underlain by the Rangal Coal Measures, which form the principal exploration target in the project area. Regional seismic data and the outcrop patterns would suggest that dips are generally low and the strata little affected by faults.

Website Footnote References

Marketable Reserves Note
The Marketable Coal Reserves of 94Mt is derived from a JORC compliant run of mine (ROM) Coal Reserve of 117.5Mt based on a 14.8% ash product and predicted yield of 80%.
Exploration Target Note
All statements as to exploration targets of Stanmore Coal and statements as to potential quality and grade are conceptual in nature. There has been insufficient exploration undertaken to date to define a coal resource and identification of a resource will be totally dependent on the outcome of further exploration. Any statement contained in this report as to exploration results or exploration targets has been made consistent with the requirements of the Australasian code for reporting of exploration results, mineral resources and ore reserves (JORC Code).
Yield Note
Note all yields and ash results reported include fines and exclude mining losses and dilution