A Walk-Through Significant Projects of Bowen Coking Coal Limited

A Walk-Through Significant Projects of Bowen Coking Coal Limited

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  • Bowen Coking Coal Limited has significant advanced exploration assets in the globally renowned Bowen Basin in Australia.
  • The Company has reported significant resource estimate at its 3-majority owned coking coal projects.
  • The company intends to capitalise on the increase in demand for coking coal, whose demand is driven by global steel consumption.

Queensland based coking coal exploration and development company, Bowen Coking Coal Limited (ASX:BCB) has advanced exploration assets and owns several coking coal projects in the world-renowned Bowen Basin, namely the Isaac River, Cooroorah, and Hillalong coking coal Projects (90% BCB and 10%  Sumitomo).

In addition to these significant projects, BCB is also a joint venture partner in Mackenzie coking coal Project (5% interest) and Lilyvale Project (15% interest) with Stanmore Coal Limited (ASX:SMR).

Along with being committed to growth through quality asset development, the business strategy of the Company is to reinforce its aggressive exploration and development program for the projects.

Let us place the 3 majority-owned projects of BCB under the spotlight and gain more insights about the same.

Isaac River Coking Coal Project (100% BCB)

Covering an area of 14 km2, the project is located 30 km west of Moranbah and 130 km southwest of Mackay in the Bowen Basin in Central Queensland and includes Mineral Development Licence 444 (MDL 444) and Exploration Permit for Coal 830 (EPC 830).

The Company involved Xenith Consulting for concluding a maiden exploration program in November 2018 on the Leichhardt seam only. The study reported no change in the resource estimate of 5.3Mt, which was reviewed again in May 2019. The Company concluded a revised maiden resource estimate program with a resource increase of more than 67% from the initial 5.3Mt to 8.7Mt. Total measured and indicated resources at the project now stand at 8.35Mt (5.69Mt measured and 2.6Mt indicated), indicating more than 95% of the total resource.

Isaac River Resource Estimate (Source: Company's Report)

Isaac River Resource Estimate (Source: Company’s Report)

Moreover, the drilling program concluded in April 2019 confirmed the existence of the higher quality Vermont Upper seam intersected in all six drill holes.

Additionally, the washability results from its maiden exploration program at the project demonstrated a significant quality upgrade from the historical coal quality results. Raw coal from the project can be washed to achieve a primary coking coal fraction with secondary PCI (Pulverised Coal Injection) coal.

BCB also crossed a major milestone by lodging a Mining Lease Application (MLA) for the project. The Company has been extremely busy in trying to convert its low capital development project into a producing asset, and filling of MLA was the most crucial step accomplished.

The Company management has been engaged in finalising additional activities related to exploration at Isaac River Project, including LOX line definition, gas content, further coal quality investigation, structural interpretation, and geotechnical analysis to ensure availability of sufficient data for supporting feasibility studies.

Hillalong Coking Coal Project (90% BCB and 10% Sumitomo)

Located in the northern Bowen Basin, the 99 km2 project comprises of EPC 1824, and EPC 2141, which is the subject of a farm-in agreement with Sumitomo Corporation. A joint venture agreement with Sumitomo has been in place since May 1, 2020, wherein a 10% stake in phase 1 of the project was acquired through a $2.5 million investment. Sumitomo can acquire an additional 10%, by investing a further $5 million in phase 2.

Approximately 105 km west-southwest of Mackay, EPC 1824 is situated, which contains the Rangal coal measures and Fort Cooper coal measures as a part of 15 sub-blocks tenement in total.

BCB recently announced total JORC resource estimate of 43 Mt for the northern part of the Hillalong Project, of which 19.5 Mt is shallower than 150 m deep. Moreover, 21 Mt is classified as indicated and 22 Mt as inferred, and that the 2020 drilling and modelling validated the resource area remains open towards the North East and South West.

Summary of the Resource Estimate for Hillalong North (Source: Company's Report)

Summary of the Resource Estimate for Hillalong North (Source: Company’s Report)

The maiden exploration program for Hillalong North offers encouraging results in terms of the resource estimate as well as the coal quality observed.

Currently, fast float and washability analysis are being undertaken in anticipation to obtain a more definitive indication of the potential final product quality and the work for defining the next phase exploration plan has also started.

Cooroorah Coking Coal Project (100% BCB)

Located 17 kilometres north of Blackwater, the Cooroorah Coking Coal Project comprises of an MDL 162 targeting the well-known Rangal measures and hosts the Aries, Castor, Pollux and Pisces seams, claiming a resource estimate of 125Mt, including 70Mt indicated and 55Mt inferred resource.

A maiden drilling program, comprising two HQ drill holes targeting all four coal seams for resource delineation and testing the washability and coking coal quality, produced positive results in February 2018 and was followed up by an additional drilling program, which was concluded in December 2018.

Subsequent to a review and validation of the regional historical drilling results, BCB’s total mineral resource estimate is currently estimated at 177Mt, of which 96Mt (54%) is classified as indicated and 81Mt (46%) as inferred, of which the Mammoth seam is now estimated to be a total of 60Mt, comprising 38Mt as indicated and 22Mt as inferred.

In December 2019, BCB finalised the acquisition and interpretation of approximately 6.5km of 2D seismic data covering its Cooroorah Coking Coal Project to locate faults and any other structural features associated with the target coal seams, the interpretation of which is a necessary and key part of the mine plan process.

The demand for coking coal is highly dependent on global steel consumption, and the Company looks forward to taking advantage of any increase in demand for coking coal from the changing aspects of the steel market.

BCB on 22 June 2020 (AEST 01:26pm) is trading at $0.054, with a market capitalisation of $43.3 million.

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