Completion of Field Technical Programme And Progressing Coal-to-Liquids Feasibility Study
Altona Resources Plc, the Australian based energy company, is pleased to announce the completion of the key technical field components of the pre-feasibility study for the development of an integrated Coal-To-Liquids ("CTL") plant and Co-generation power facility, at its Arckaringa Project ("Arckaringa") in South Australia.
The drilling campaign focused on the Wintinna Coal Deposit and was completed on schedule on 11th February, 2008. Sufficient total drilling meterage and sampling was achieved from 20 boreholes to meet the programme's key objectives, including the definition of approximately 700 million tonnes of coal that can be classified as Measured or Indicated according to the current JORC Code for reporting resources.
The Company anticipates that it will take two months to evaluate and report on the results of the field programme and bring the pre feasibility stage to a close. A positive outcome will enable Altona to proceed confidently to the final feasibility stage of its Bankable Feasibility Study ("BFS").
The following core strengths have been confirmed during pre-feasibility at Arckaringa:
* Proven coal resources * Conventional open cut coal mining possible for the Wintinna deposit * Coal resources of a quality suitable for CTL technology * Expandable plant design * Excellent infrastructure with immediate access to existing railway and ports * Strong demand for electricity in South Australia due to State deficit * Existing export and domestic markets for diesel and jet fuels * Strong Government support in a politically stable country * Environmental issues identified * Competitive project economics
A decision to move to final feasibility is likely to elevate Arckaringa to "Major Project" status in South Australia, under which the State Government would establish a process to streamline evaluation and approvals. Based on advice from key advisers, including Jacobs Consultancy and Hatch Engineering, the Company anticipates that the final feasibility and Government approvals stage will take approximately 24 months. The construction of two modules comprising the "base case" 10 million barrel per year CTL Plant and associated power facility could come on stream over a period of between 36 and 54 months.
Presenting at the AJM 3rd Annual Coal-To-Liquids/Gas-To-Liquids Conference in Brisbane on 27 February, Altona's Managing Director Chris Schrape highlighted the steady progress demonstrated over the past 12 months, and set out the proposed schedule for the final feasibility stage, including Government approvals, and for the construction of Arckaringa. The Minister for Resources and Energy, Hon. Martin Ferguson stated at the conference, "Energy security is absolutely critical to Australia's economic prosperity and I believe coal-to-liquids and gas-to-liquids will play a major role in Australia's energy future."
As part of Altona's continued drive in targeting Australasian markets, Mr Schrape will also be presenting at the 5th Annual CTLtec Conference in Beijing on 4 March.
Chris Schrape said, "Following an intense and productive period for Altona I am pleased to wrap up the drilling campaign at Arckaringa, and with the completion of the pre feasibility study in sight, look forward to progressing to the final stage of the BFS. All the positive factors favouring development at Arckaringa continue to be confirmed by our studies and it is shaping up as a highly exciting project. The Arckaringa coal basin contains an estimated 7.8 billion tonnes of coal. The CTL process is ideal for the resource, and the demand economics from local and international markets will underpin the potential of the project.
"The next period of activity for the Company will be even busier, as we focus on planning and managing the final feasibility work and targeting both the Australian and Asian markets for the project's future production of high value liquid fuels. We believe that the Asian market in particular could be vital for Altona and we are keen to cement relationships, such as our recently announced deal with Hong Kong investment house Tongjiang International Energy, to build strategic business opportunities moving forward. In that regard, I look forward to presenting in Beijing and telling the Chinese market more about the full potential of the Arckaringa Project.
A bulk sample of approximately five tonnes of coal has been sampled from five large diameter (200mm) partially cored boreholes since drilling operations commenced on 5th May, 2007. Groundwater production wells and monitoring piezometers were constructed for a comprehensive assessment of the hydrogeological characteristics of the deposit and four cored geotechnical boreholes were completed to better define the geotechnical parameters of the different lithological units proposed to be mined at the deposit. Ten geophysically logged slim diameter (HQ-61mm) partially cored boreholes and two geophysically logged open holes were drilled to reduce the borehole spacing within the area of interest to between 500 metres and 1 kilometre for resource definition purposes.
Each of the completed boreholes was successfully geophysically logged. All coal seams have been sampled and dispatched to the ACIRL laboratories for testing and analysis. The programme focused on the optimum area within the Wintinna deposit for extraction by open-cut mining methods.
A copy of the Mr. Schrape's presentation to the Brisbane Conference is available on the Company's website www.altonaresources.com
The information contained in this announcement has been reviewed by Norman Kennedy, the Technical Director of the Company. Mr Kennedy holds a Bachelor of Science from the University of NSW, and is a Member of the Australian Institute of Mining and Metallurgy