Fox Resources (ASX: FXR) has identified a significant strike extension to the coal seams at its Bundaberg Project in the Bowen Basin, Queensland, with an Exploration Target of 20 million to 50 million tonnes.
The recently announced Inferred Resource of 101Mt of coking coal and the Exploration Target together provide a growing resource base with which we believe should assist to attract a larger group.
This extension was identified during the process of completing the Inferred Resource of 101 million tonnes of coking coal.
Multiple historical drill holes within the identified strike extension have intersected the main GU, GL1 and the GL2 seams that constitute the Resource to the north.
Notably, several of these holes were not drilled to a sufficient depth to intersect these prospective seams.
In addition, the Exploration Target does not include any down-dip extensions of the coal seams nor does it include some conceptual targets that occur to the east of the Inferred Resource.
Fox is planning to carry out further work within the Exploration Target with the aim of improving the geological understanding of the coal seams in the area; within the Inferred Resource to increase the confidence in the Resource Estimate; and in other areas of EPC1523.
The company is currently in the process of generating from Coal Quality Sampling at the Fox 6 hole, two composite clean products, one at CF1.45 and the other at CF1.60 and testing these for a range of coking and thermal properties.
Further information including the results of analytical and coal quality tests are expected in the coming weeks.
Future exploration on Fox's tenement EPC1523 are likely to include drilling programs consisting of a combination of widely-spaced structural and large-diameter cored holes so as to improve the confidence in the resource.
Bundaberg Coking Coal Project
Fox had last month defined an Inferred Resource of 101.2 million tonnes of coking coal at EPC1523 with coal samples confirming raw calorific values that exceeded 7,000KCal/kg for large sections of the seams.
In addition, the raw crucible Swelling Index numbers of 8 to 8.5 were similar to those released by ICX in EPC2196 to the north, ranking the coal amongst the highest quality coking coal in the Bowen Basin.
Fox has also agreed to share information with International Coal (ASX: ICX) and Hancock Prospecting subsidiary Queensland Coal Investments, who have defined an Inferred Resource of 37.9 million tonnes in EPC2196 to the north.
Given that both permits appear to share the same coal seams, this could result in a joint development of their respective coal resources.
An early result of this agreement has been the removal for the need for infill drilling following Fox's initial drilling program at EPC1523.
The recently announced Inferred Resource of 101Mt of coking coal and the Exploration Target of between 20Mt and 50Mt together provide a growing resource which we believe should assist in attracting a larger group.
We believe there would be other companies, or steel mills, in Asian markets that could be interested in a growing resource base of coking coal with a raw crucible swell number in large sections of the seam exceeding 8.0.
This is especially true given that Fox Resources is capped at circa just $9 million.
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.