Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Fox Resources Intersects Two Separate Coal Seams At Bundaberg

Fox Resources (ASX:FXR) has intersected two separate coal seams totalling 3.47 metres over a 8.72 metre interval from 74.3 metres down hole from drilling of three holes at its Bundaberg coking coal project in Queensland.

Samples have been dispatched for coal quality analyses from Fox 6CQ, to test for a primary coking and secondary thermal product.

Interestingly, the early geological interpretation from geophysical logging of holes completed to date is that the coal seams are somewhat shallower in EPC1523 than expected from drilling on the EPC2196 by the International Coal (ASX:ICX) and Hancock Prospecting drilling nearby.

The width of these seams has been estimated from the one metre rotary chip samples with the confirmation of the seam thickness based on down hole logging.

The current drill program is expected to wrap up by mid-February.

In detail

The most encouraging hole, called Fox 4, intersected multiple coal seams including two separate coal seams, each visually estimated from the geological logging to be approximately two metres thick from 74 metres to 83 metres down hole.

The width of these seams has been estimated from the one metre rotary chip samples with the confirmation of the seam thickness based on down hole logging.

From the geological logging of the one metre samples the other two recently completed holes, named Fox 5 and Fox 10, although intersecting some minor weathered coal, failed to intersect significant thicknesses of coal.

The current interpretation of the geology within the area is that the prospective coal seams are outcropping in the area of the collar locations of both Fox 5 and Fox 10.

Earlier drilling

An earlier hole drilled by Fox Resources in December intersected 2.4 metres of coal over a 4.4 metre interval.

Resource estimation

Planned resource estimation of the coal within the area will be based on the geological and geophysical interpretation at the completion of the drilling program.

Funding update

Fox Resources has made a $250,000 part repayment on the $500,000 convertible loan and renegotiated terms for the remaining loan balance.

The agreed terms for the loan with Murdoch Capital are that the loan will have an interest rate of ten percent per annum and will be repayable on or before 14 April 2014 or, at the Lenders election be repayable by the issue of new ordinary fully paid shares at a price per share based on a discount of 18 percent of the average daily VWAPs per share for the 30 days.

Chairman Terry Streeter

Chairman of Fox Resources is Terry Streeter, who was the founder and until recently the chairman of Western Areas (ASX: WSA), a $500 million market cap., and has a strong track record in adding value for investors.

Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.