The 18 chipholes have been completed in the northern half of the tenement, indicating that the coal seams are continuous to the north and have a similar thickness and apparent quality as in the south.

A 1.2 billion tonne JORC inferred thermal coal resource has already been discovered in the south.

“It is great to find that the coal seams in the south are continuing in the north; it effectively increases the strike length of the resource to the north by approximately 14 kilometres,” East Energy Resources managing director Mark Basso said.

“The initial observations of our exploration manager indicate that coal has been found again at shallow depths. This is exciting as it will translate to lower mining costs.”

Fresh coal has been found at a depth of 12-15m along the eastern side of the Blackall tenement, which corresponds to the depth of weathering. The structure of the deposit in the north mirrors that in the south, with seams dipping from east to west at an angle of less than 2 degrees.

Following these initial results, East Energy will close up the drilling in the north to less than 4km centres and complete coring of the seams for coal quality analysis. Once the quality has been established and seam correlations completed, the data will be used to substantially upgrade the JORC-compliant resource.

“Subject to the completion of the detailed evaluation, it is expected that the coal found in the northern portion of our Blackall tenement could conceivably increase the total resource in the tenement to in excess of 2 billion tonnes,” Basso said.

East Energy was up 0.5c to 17.5c in early trade.