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African Energy Resources Unearths New Coal Discovery In Zambia

African Energy Resources (ASX: AFR) is adding to its African coal inventory with a new discovery at the Sinazongwe prospect in Zambia close to existing coal mines.

Multiple coal seams were intersected in all of the completed core holes and, importantly, these coal seams are open along strike and down dip.

Raw coal calorific values returned ranged from 10 to 26 megajoules per kilogram.

Highlighting the potential for coking coal properties, there was an extensive presence of vitrinite bands.

In mid-2011, reconnaissance exploration identified coal bearing sediments with a strike length of about 10 kilometres.

These sediments are mapped by a geological survey as the extension of the stratigraphy that hosts the Maamba Colliery and the Collum Coal Mine, Zambia's only producing coal deposits.

Next steps

African Energy now plans to test the coking properties of the coal as well as undertake washing yield analysis.

This work will determine if the coal has the potential for one or two products - a higher value coking fraction and a middling for use as a power station fuel.

Sese - path to production

Meanwhile, over at the Sese Thermal Coal Project in Botswana, African Energy recently completed a milestone rail delivery of coal to Maputo.

The significance of this is that the company has demonstrated that the transport of Sese coal via rail to the east coast of Africa is possible using existing infrastructure.

The trial shipment is a huge step in African Energy's and Botswana's ambitious plans to fully exploit its coal resources with exports and power plants as the primary targets.

Importantly, the east coast of Africa is considered an ideal location from which Botswana's coal may be ultimately exported to Asian markets.

The market for Sese coal includes domestically with existing industrial customers and nearby markets, with this demand set to grow as new customers enter the market as new mines and businesses develop.

There is also a growing regional market in Southern Africa, with the Power Pool facing net regional electricity generating deficit as Eskom exports scale back.

Then there are the export markets where demand remains high, especially in India, with few undeveloped coal provinces capable of meeting this demand.

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