A-Cap Resources (ASX:ACB) recently delivered the maiden JORC Resource at its Foley prospect in Botswana of 148Mt of thermal coal, which includes a Resource of 66.6Mt in the SS Seam at an average yield of 78.25%.
The coal is suitable for meeting current specifications used for power elsewhere in southern Africa, and therefore has a potential fast-track to market.
The company's other key interest is the Letlhakane project, also located in Botswana, which hosts one of the world's largest undeveloped uranium deposits with a total resource of 308 million pounds.
The project has low capital costs, competitive operating costs in a stable political and permitting friendly environment.
PROACTIVE INVESTORS: Welcome Paul.
Can the 66Mt SS Seam portion of the Foley coal resource be fast-tracked to production?
Paul Thomson: This is certainly the case and is the reason that we have taken the approach that we have.
We are keeping the project small so that we can take advantage of the existing infrastructure, both transmission grid and rail and do so very quickly.
Our coal does meet current specs used for power elsewhere in Southern Africa and we are looking for potential partners to develop both the Foley and Mea coal projects either as an export or regional power opportunity.
Does Foley have advantages over other coal deposits in the area in getting to market given its close proximity to road, rail and power?
Paul Thomson: This does give us an advantage over some of the other coal projects within Botswana as we will have minimal infrastructure to develop as it mostly exists already. This also assists with keeping capital costs low and enables us to move quickly.
We are not the only project that has this advantage, but certainly we are in a better position than many projects.
Is there an opportunity to work with African Energy Resources?
Paul Thomson: We have had discussions with a number of organisation's about potential partnerships and these are ongoing and positive
Sedgman of South Africa has previously done detailed positive desktop studies on both the Mea and Foley projects and we have recently finalised drilling programs on both of these and they are currently updating the reports at present.
We expect these to be available in the near term.
Moving on to the Letlhakane Uranium Project, are feasibility studies still on track for the submission of a mining licence in the first half of 2015?
Paul Thomson: We are pleased to report that feasibility work is progressing well and we are on track and budget for completion in the first quarter of next year to support our mining licence application for Letlhakane in the second quarter of 2015.
We are fortunate to be operating in Botswana a premier mining destination with stable government, clear and simple mining laws where strong rule of law applies.
What is the progress on infill drilling to build inventory for the probable JORC Reserve?
Paul Thomson: We have just finalised the infill drilling program and have excellent results confirming the presence and continuity of higher grade uranium mineralisation which will now be incorporated into a new resource model in the first quarter of 2015.
Trials with uniform condition and localised uniform conditioning in the resource modelling have shown the potential to utilise the resource technique across the deposit.
Where does Letlhakane rank in regards to size and scale to other undeveloped uranium projects in Africa, and the world?
Paul Thomson: The key to the Letlhakane project in the medium term is the recently announced significant high grade resource 83.7Mt at 447ppm U3O8 for a contained 82.5Mlbs of U3O8.
This resource upgrade has significant implications for new economics of the project which are being updated along with the finalisation of the feasibility studies into a new economic model we will have completed in the first quarter of 2015.
Letlhakane is also one of the top ten global undeveloped uranium deposits with a resource of 308Mlbs at a cut off at 100ppm U3O8 so has very strong long term leverage to a rising uranium price.
Finally, can you outline some key catalysts for the next year?
Paul Thomson: The uranium industry has been depressed post Fukushima, however we have recently started to see the uranium spot price trending upwards.
We remain optimistic that this will continue in the next few years.
Our primary short term goal is to have our Mining License application submitted mid next year and continue the development of the Letlhakane project so that it is positioned for early production as the market demand requirements grow.
With Botswana enormous coal resources and it being a central stable hub in the Southern African countries there is the opportunity to become a regional power producer.
In parallel there are positive developments of both short term and long term infrastructure to enable export of coal through various countries. Our goal is to continue to progress our Mea and Bolau projects and find a partner to engage in either an export or power generation opportunity.
PROACTIVE INVESTORS: Thank-you Paul.
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