Hodges Resources, the junior explorer listed on the Australian Stock Exchange, said it has finished drilling programme at its Moiyabana Coal Project in Botswana, with selected coal seams showing they could be washed to a level similar to premium Australian coal quality.
According to the company’s quarterly report for the 3 months ended December 2011, over 6,500 metres were drilled within 69 drill holes.
Hodges said all holes which underwent wash testing recorded seams with results above 6,000 Kcal/kg with variable yields ranging from 26 percent to 76 percent.
The Australian outfit added that hole KP14 had one sample with a 68 percent yield to produce a coal with a calorific value at 7,212 Kcal/kg and 9.5 percent ash; hole KD21 had one sample with 49 percent yield resulting in coal with a calorific value at 7,035Kcal/kg and 10.6 percent ash, and another seam with a 57 percent yield for a 6,715 Kcal/kg and 15 percent ash resultant.
Mark Major MD of Hodges Resources is bullish about the export potential of the Moiyabana coal.
“We are encouraged by the initial coal quality and wash test results on the coal seams. It has shown that we can increase the coal calorific value and remove a significant proportion of the ash to produce a premium coal product for the export market if required,” Major said.
“Better still, with a considerable portion of these seams at shallow depths, some as little as 33 metres from surface, and with the viable yields from the wash testing we believe that a commercial feasible coal mining operation may be possible at Moiyabana,” he added.
The Moiyabana project is located approximately 70km from the operational Morupule mine and Colliery; the only operational coal fired power plant in Botswana.
Historically the area was partially explored by Shell Coal Botswana during the 1970’s Jaquar Ventures (Pty) Ltd, who completed thirteen diamond drill holes during the period 2009-2010.
Based on the results of the Runge Independent geological report as reported in an ASX press release on 7th June 2011, a coal exploration target of around 1.4 to 1.6 billion tonnes could be defined in the 140km2 area of which an estimated 660 million tonnes indicates suitability for open cast mining.
Major said that the open pit potential of the coal seams remained an important consideration for any future commercial mining operations, and the drill results and recent coal quality results continue to support this case.
Hodges has already started the geological and resource modelling work and the Company expects to have its maiden JORC resource on the project in Q1 2012.
JORC is the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. It requires that for a published report to be compliant with the JORC Code in reporting resources, reserves or exploration results, the documentation on which the report is based must be prepared by, or under the direction of, and signed by, a Competent Person or Persons.
At the Morupule South Coal Project, Hodges said a program of follow-up infill diamond and RC drilling was completed.
Up to date, 25 individual raw coal core samples were selected for analysis on the basis of geological boundaries and have been summarised as weighted averages of composite intersections with the percentage of ash being less than 40 percent.
The Morupule South Coal Project is located to the south of the operational Morupule Colliery in central east Botswana. The project consists of one prospecting licence (PL121/2010), covering a total area of 264.4km2 within the eastern central district of Botswana.
At the end of the December quarter, Hodges Resources Ltd (‘Hodges’ or the ‘Company’) had cash reserves of approximately $4.1 million with a further $3.6 million in receivables (under terms and conditions of commercial agreements in relation to the Botswana and Ghana projects).
During the quarter, 1.85 million options were exercised to raise $370,000.