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ASX ANNOUNCEMENT
Market Update
International Coal Embarks On Key Bowen
Basin Project Near Glencore Xstrata Mine
Highlights
• International Coal Limited (ICX) is preparing to embark on a new phase
of exploration at its Consuelo Project in the Bowen Basin.
• The Board of International Coal has approved a detailed exploration
program on EPC 2318, subject to final costings.
• The Consuelo Project has an Exploration Target estimated at between
800 and 1,700Mt1 of high-grade coal with a strong potential of producing
a semi-soft coking coal product.
• The project is within 10 km east of Glencore Xstrata Rollestone mine and
is within 10-20 km of an independent rail line to Gladstone Port.
• The company is looking to substantially increase JORC resources in
addition to their 1.274 Bt at South Blackall and their2 28.5Mt3 of inferred
resource at its Bundaberg hard coking coal project.
• Bundaberg hard coking coal project remains on schedule for drilling by
the end of Q3 2013 as previously reported.
• Advanced discussions with end user Chinese corporations continue.
• The ICX board continues to focus on developing its metallurgical coal
projects to meet growing demand from Chinese steel mills.
• The company calls on interested shareholders and investors to subscribe
to receive regular updates on the progress of our projects via email.
24 September 2013: International Coal Limited (ASX: ICX) is pleased to provide
an update to the market on its activities and announce that the company is about
to embark on an exciting new phase of exploration at its Consuelo Project.
Consuelo is an underexplored area just south-east of Glencore Xstrata PLC’s
Rolleston Mine (8Mtpa production with a current expansion underway) and east of
Bandanna Energy Arcadia Deposit (273 Mt Inferred Resource reported). The area
has potential for shallow coal and includes a 300 to 800Mt Exploration Target at
less than 250m.
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Mr Simpson (ICX CEO) said, “We expect to intersect coal seams at mineable depths
in the Bandanna Formation - the same formation that hosts coal produced from the
Glencore Xstrata Rolleston Mine. We are looking to establish a JORC Inferred
Resource and to test the coal quality”.
“We are about to explore one of our most exciting prospects to date in the Bowen
Basin (Consuelo Project) and are leveraging our joint venture relationships to
achieve success at low cost. We also intend to make the most of some of the lowest
exploration costs in close to a decade. We continue to back our ability to achieve
significant coal finds and pursue new opportunities for coal discoveries”.
Consuelo Project Update
The Consuelo Project (EPC 2318, 2332, and applications 2327 and 2925 (Figure 1
and 2) will be a flagship project for the company providing ICX with a major stake
in a potentially large coal prospect in the Bowen Basin, one of the world’s premier
coal basins. The project which lies within 10-20km of the existing Blackwater Rail
line to Gladstone sits between Glencore XStrata PLC’s Rolleston mine and
Bandanna Energy Limited’s Arcadia Project. The coals of the Bandanna Formation
have potential to deliver a washed semi-soft coking coal product.
Preparations are underway to explore EPC 2318 (Part of the Consuelo Project) in
the Bowen Basin following its grant in July 2013. The Consuelo Project has an
Exploration Target estimated at between 800 and 1,700Mt1 of high grade coal that
has potential to be washed to produce a semi soft coking output. The company has
written to the registered native title claimants regarding cultural heritage
clearances for its proposed program and has made initial contact with landholders
in the area.
ICX is also finalising a conceptual analysis of the Consuelo Project with the
assistance of resource modelling experts ROM Resources. The results of the
conceptual analysis are being included in a brochure being drafted for
presentation to the market and to parties interested in investing in the company. A
pdf version (in English and Chinese) will be made available on the company
website once the conceptual study is completed and the brochure finalised.
“The Board and I are keen to see the company focus its resource on its best
projects and to keep projects like the Consuelo Project moving forward,” Mr
Simpson said. “We expect that this project will place the company in a much
stronger position to attract large strategic investors and look forward to updating
the market in the near future on our progress”.
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Bundaberg Project Update
Work on the Bundaberg Project is currently focused on EPC 2196 (Figure 1 and 3)
which lies north-east of Bundaberg. All clearance work has been undertaken and
the next drilling program remains on schedule to commence at the end of Q3
2013. For more details on this project please refer to ICX’s JORC resource
announcement on the 25th March 2013.
South Blackall Project
Progress on South Blackall (Figure 1 and 4) was focussed on desktop research
with a view to improving the company’s knowledge of the viability of potential
development options for the 1.24Bt4 Inferred Resource identified in the Eromanga
Basin. ICX continues to engage with community groups, governments, and other
interested parties to drive long-term development in the region. The board also
notes the current willingness of the QLD state government to fast track
infrastructure to the nearby Galilee region.
Corporate Activities
The board continues to receive enquires from major Chinese corporations
that are interested in the supply of coal product. Discussions have been at
both an equity and project level. The company will keep shareholders
informed of future progress in these discussions.
The company has recently commenced an information emailing facility. For
shareholders interested in receiving email alerts of International Coal Limited’s
ASX releases they should subscribe by emailing [email protected] and include
”Email Alerts Subscription” in the subject line. Alternatively, you can follow the
prompts at the bottom of International Coal’s home page at www.intercoal.com.au .
We intend to update the market on a more regular basis as we commence this new
phase of exploration, which we expect will develop considerable market interest.
Summary
International Coal continues to work towards developing key projects like the Bundaberg and Consuelo Projects with a clear focus to produce metallurgical coal to meet with the growing demand from Chinese steel mills. This is a very exciting period that the company is entering into and we expect to be in a position to report on further successful results soon. We would like to take this opportunity to thank our existing loyal shareholders and look forward to updating them of our progress shortly.
For further information please contact:
Glenn Simpson
Chief Executive Officer
0428 886 537
Hugh Dai
Executive Director
0416 186 888
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NOTES
1) It should be noted that the tonnages quoted above are conceptual in nature and there has been insufficient
exploration to define a coal resource. No coal quality data within the project area was uncovered in previous reports. It
is uncertain whether further exploration may lead to the reporting of a JORC-standard resource however there is some
evidence to support the current exploration tonnage calculations, and the sufficient coal thicknesses interpreted from
historic drilling to warrant further investigation in some areas. Structural and coal quality modelling completed using
historical boreholes and market releases of regional miners and developers. Coal quality grids created assuming a
standard density for all seams to allow for resource calculation. The Bandanna Formation has been given an average
density of 1.4 g/cc; total in situ tonnes with no constraints.
2)The Total Inferred Resources referenced is based on the addition of a 1.246 Bt Inferred Resource at EPC 2197 (South
Blackall - 100% ICX) and 28.6Mt Inferred at EPC 2196 (Bundaberg – currently 100% ICX but subject to a farm-in
arrangement under a joint venture agreement with Queensland Coal Investment Pty Ltd). Both values have previously
been reported in announcements on 31 March 2013 (Bundaberg) and 26 November 2013 (South Blackall).
3) Constraints on the Inferred Resources are as follows: Coal seams not intruded or not outside the tenure boundaries;
coal thicknesses <0.2m excluded; depth range of calculation was from the base of weathering to 450m below natural
topography; coal seams where the F, GU, GL1 and GL2 ash (adb) >50% are excluded from the calculations; discount
factor of 12% has been subtracted from the initial calculation for unexpected geological losses. This accounts for
unexpected conditions such as seam thinning, splitting, or seams missing in barren zones around faults. The geological
modelling package used was Minescape and seam structure and thickness contours were generated using standard
modelling algorithms and methodologies. Inferred masks were generated from base circles drawn 2,600m between
Points of Observation; Points of Observation were defined as those boreholes that had known surveyed positions,
detailed lithological logs and coverage of the target coal seams with a suite of downhole geophysical logs that must
include density in units of Kg/m3.
4) Constraints on the Inferred Resources are as follows: Coal seams not intruded or not outside the tenure boundaries;
coal thicknesses <0.2m excluded; depth range of calculation was from the base of weathering to 450m below natural
topography; coal seams; discount factor of 8-12% (depending on the seam) has been subtracted from the initial
calculation for unexpected geological losses. This accounts for unexpected conditions such as seam thinning, splitting, or
seams missing in barren zones around faults. The geological modelling package used was Minescape and seam
structure and thickness contours were generated using standard modelling algorithms and methodologies. Inferred
masks were generated from base circles drawn 3,800m between Points of Observation; Total Inferred Mask area was
149.52km2; Points of Observation were defined as those boreholes that had known surveyed positions, detailed
lithological logs and coverage of the target coal seams with a suite of downhole geophysical logs that must include
density in units of Kg/m3.
Competent Persons Statement
Technical information relating to the coal projects in this announcement has been
compiled by the ICX/QCI JV and reviewed by Mr Mark Biggs, Principal Geologist of ROM
Resources Pty Ltd. Mr Biggs is a member of the Australasian Institute of Mining and
Metallurgy and has over 24 years of experience relevant to the style and type of coal
mineralisation under consideration and to the activity which is being undertaken to
qualify as a Competent Person as defined by the Australasian Code for Reporting of
Minerals Resources and Reserves (JORC) 2004.
The estimates of the Coal Resources presented in this Report are considered to be a
true reflection of the Coal Resources as at 19th February 2013 and have been carried
out in accordance with the principles and guidelines of the Australian Code for
Reporting of Coal Resources and Coal Reserves published in December 2012 (JORC
Code). Mr Mark Biggs consents to the inclusion in this announcement of the matters
based on this information in the form and context in which it appears.
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Figure 1 – Key Projects being explored and developed by International Coal Limited
(September 2013)
Quality Bowen Basin project with pathway to mine
(Exploration Target 800-1700Mt1)
Hard coking
coal project
(28.5Mt3
Inferred
Resource)
A massive foothold (1.246Bt Inferred Resource4) in an
emerging and under explored coal region
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Figure 2 – Location of Consuelo Project (13 September 2013)
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Figure 3 - Location of EPC 2196 showing Inferred Re source Mask Area and Exploration Target area.
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Figure 4 – Location of EPC 2197 (South Blackall) an d nearby coal deposits
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