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Stanmore Coal encouraged by JORC resource at The Range Project

Stanmore Coal (ASX: SMR) has reported that a review and modelling of the initial drilling results from the company’s 100% owned tenement EPC1112 - known as The Range - has defined an initial 117 million tonnes JORC Inferred Resource of raw coal.

80Mt has a strip ratio of 8 to 1 or less, with a maximum strip ratio of 11 to 1. There is potential to extend the resource as coal seams are open to the west.

Modelling of raw coal quality data and detailed ply by ply correlation has led to the definition of seven mineable coal seams.

The initial Inferred Resource of open pit, high quality export thermal coal represents a significant increase from the previous exploration target of 40-50 Mt published in the company’s 2009 Prospectus, issued as part of the company’s IPO.

A review by Xenith Consulting Pty Ltd. demonstrated that an open cut mining process is possible, with depths to top of coal ranging from 15m to 50m and average net coal per hole is 6.1m. The review also identified an additional exploration target of 100–125Mt.

Stanmore Coal Managing Director Nick Jorss said, “the initial drilling program has defined a much larger coal resource than our previous estimates. This is a very attractive coal deposit with all the hallmarks of turning into a first class project.”

“The results of the initial program give us the confidence to progress The Range to the next stage, with further drilling underway and plans for prefeasibility studies in the near term,”  Jorss said.

“We are also in discussions with relevant infrastructure providers about transport options for The Range project,” he added.

The company has recently initiated an additional drilling program with the aim of increasing the JORC Inferred Resource and better defining the extent of the deposit.

Prefeasibility studies will commence after the next round of drilling. These will include
investigations into land access, mining methods, coal processing, environment, infrastructure, markets and financing.

The tenement is situated 24km south east of Wandoan in the Surat Basin and covers an area of approximately 90km2.

The drilling program from December 2009 to March 2010 included: 16 rotary holes generally at 1km spacings across an eastern area of the EPC (approximately 5km x 2km); and 9 cored holes generally at 1km spacings across the same area.

Coal quality testing was performed by Bureau Veritas’ Brisbane laboratory. The company said results are encouraging with the coal displaying relatively low raw ash, low sulphur, high caloric value and high volatiles.

The preliminary washability test results returned a range of 6-12% ash, indicating an export
quality product.

Stanmore Coal has also applied for two adjoining sub blocks (EPCA2030). These adjoin the EPC1112 tenement on the southern boundary and are well located with respect to the coal deposit.

EPCA2030 is non competitive (i.e. Stanmore Coal is the sole applicant) and has the potential to add further to the size of the coal resource.

Disclosure: The author holds no positions in the company