The company, which is basing its forecast on the geological information from historic drilling programs and its own drilling results, has found prospective thermal coal seams located at various depths to the surface.
“The broad range of thermal coal seam depth has allowed MetroCoal to formulate and implement a unique business plan to further explore and assess the commercial feasibility of the tenements and, if appropriate, exploit the tenements through conventional open cast and underground mining techniques and underground coal gasification,” the company said in its December quarterly.
Under the terms of a joint venture agreement, Chinese group SinoCoal has acquired a 51% interest in MetroCoal’s EPC 1165 Columboola in the Surat Basin for an agreed expenditure of $30 million on the permit.
The funds will be used for exploring and evaluating potential commercialisation options within the Columboola tenement, while the agreement opens up the opportunity for SinoCoal’s participation in MetroCoal’s other tenements.
The Columboola JVA requires a minimum expenditure of $4 million within the first two years of the agreement.
The initial exploration program is designed to test the entire Walloon sub-group, containing the highly prospective Macalister seams of the Juandah coal measures and the deeper Taroom coal measures.
The program will concentrate on the most prospective areas within Columboola to achieve the exploration target of between 830 million tonnes and 1.165Bt.
The planned drilling program consists of 30 holes on a 3.6-kilometre offset grid to optimise drill spacing for initial resource estimation.
This program began in early December with the appointment of Dynamic Drilling but was suspended before Christmas due to wet weather.
During the quarter, Neil Mackenzie-Forbes was appointed as general manager of the JV and Jiangong Zhu of SinoCoal as deputy general manager.
The Columboola JV also secured Geos Mining for the management of geological services. Geos Mining is a specialist geology consultancy based in Sydney, with Australian and international experience in coal and other minerals.
