Bowen Coking Coal Limited Advancing Well in the World-Renowned Bowen Basin

Bowen Coking Coal Limited Advancing Well in the World-Renowned Bowen Basin

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  • Bowen Coking Coal has significant assets constituting its coking coal project portfolio in Queensland.
  • BCB has successfully concluded the drilling at its Hillalong Coking Coal Project, with coal quality results from that program imminent
  • Significant progress has been made at the Isaac River Coking Coal Project in connection with the planned development of the project
  • The Company has several activities intended to be undertaken at its projects in the current as well as upcoming quarter.

A Queensland-based coking coal exploration and development company, Bowen Coking Coal Limited (ASX:BCB) has active coking coal projects in the world-renowned Bowen Basin in Queensland, Australia, namely

The Company has been actively engaged in carrying out significant activities across its portfolio of projects as the highly experienced Board and management team of the Company aim to maximise shareholder value through progressing development of each of its coking coal projects.

The business strategy of BCB is underpinned by an aggressive exploration and development program. Let us unearth the Company’s progress at some of its projects.

Drilling Completed at Hillalong Coking Coal Project (BCB: 90% and Sumitomo 10%)

BCB has successfully completed drilling within the time limits of the Conduct and Compensation Agreement, notwithstanding considerable wet weather delays earlier in the program.

The initial plan aimed at the Rangal Coal Measures and upper Fort Coopers Measures on 28 sites with five core holes for coal quality assessment, was reduced to 27 sites due to the wet weather delays and better than expected initial exploration results increasing the total to 6 cored sites with an additional cored hole that was added in anticipation of benefitting the resource estimation process.

For identifying the seams intersected as well as to ascertain accurate thickness and seam partings, all holes were geophysically logged, and the program identified two further targets for future exploration.

Moreover, the location of the sub-crop line of the target seams around the nose of the Hillalong anticline was confirmed through the drilling, in conjunction with historic seismic information.

Exploration expenditure for Hillalong is covered under the Sumitomo Farm-In Agreement wherein Sumitomo currently holds a 10% interest having spent $2.5m and could spend up to a further $5m to earn an additional 10% of the Project.

Isaac River Coking Coal Project          

BCB has been making significant progress at its Isaac River Coking Coal Project with the Company lodging a Mining Lease Application (MLA) with the Queensland Government’s Department of Natural Resources, Mines & Energy, which represents a significant milestone in the critical path to converting the project to a producing asset.

Along with the MLA, an Initial Development Plan has been submitted by BCB that puts forward a contractor-operated open cut along with highwall mining, utilising off-site infrastructure and toll washing of mined coal at a nearby facility on the basis of a mine plan targeting high-quality coking coal and secondary PCI coal.

Isaac River Mine Licence Application area (Source: Company's Report)

Isaac River Mine Licence Application area (Source: Company’s Report)

BCB is keeping busy with specialist Environmental Consultants to perform all required studies to prepare a site-specific Environmental Authority Application for the Project, which is expected to be lodged within the upcoming quarter.

The steel industry’s consumption of metallurgical coal is major as it is a crucial component in its manufacturing. The dynamics in the steel market have a significant impact on the demand for metallurgical coal.

As the impact of the COVID-19, the global steel consumption has softened, and there is an uncertainty on projections for the commodity in the short term. Along with the vagueness on Chinese domestic production, supply disruptions stemming from weather conditions in Canada and operational issues at major Queensland producers are seen as the major contributing factors towards the increase in the price of premium hard coking coal to more than US$160 per tonne during the quarter ended 31 March 2020.

Way Ahead for BCB

Hillalong Coking Coal Project

In the coming weeks, BCB looks forward to completing the final site rehabilitation and grouting of all the holes that are currently under progress while the cores from all six holes have been despatched to Bureau Veritas’ Laboratory in Mackay for full coal quality analysis.

Moreover, updating of the geological model is currently in progress by Xenith Consulting, and the Company expects raw coal quality inputs for the model before the end of May. These inputs shall be considered for a resource estimate in accordance with the JORC code shortly after they are received.

Further, after the finalisation of the raw coal quality results, the Company has planned to undertake fast float analysis to test for coking properties, followed by washability and final coal quality analysis.

Isaac River Coking Coal Project

For Isaac River Project, BCB’s focus remains on permitting and access to infrastructure at the Project. Moreover, additional negotiations are progressing on infrastructure access, and BCB looks forward to lodging the Environmental Authority within the upcoming quarter.

In addition to the progress at project, BCB expects final approval of the Marketing and Funding transaction documents (with M Resources) during the current quarter (ending June 2020) as the transaction remains subject to shareholder approval.

Further, during the upcoming quarter, BCB’s funding for the first phase of the Hillalong exploration is expected to reach $2.5 million in terms of the Farm-In Agreement with Sumitomo.

The BCB stock is trading at $0.048 on 03 June 2020 (AEST: 3:25 pm) with a market capitalisation of $36.17 million.

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