119Mt Maiden JORC Inferred Resource at CMR’s flagship Dawson West Thermal Coal Project

In partnership with the ASF Group Limited (ASX: AFA), CMR are pleased to announce their substantial first resource discovered on their wholly owned Queensland coal project – Dawson West (EPC 2427)

  • CMR has identified a new coal precinct that is close to infrastructure and the townships of Moura & Theodore in central Queensland;
  • Exploration has defined a coal resource within the Triassic Moolayember Formation of the Bowen Basin;
  • Coal quality shows an export grade thermal product in the M Seam intersections from the CMR Dawson West Project (EPC 2427);
  • Inferred JORC Resource of 118.6 Mt in the M Seam, with an average seam thickness of 1.98m and maximum seam thickness of 2.8m;
  • Scope to increase tonnages, as the resource is open to the west for 24km’s and open to the east for 23km’s, with potential to find coal seams at opencast depths to the east and west;
  • The Inferred Resource is only 62km2 of a total 1,436km2 across the Project area;
  • Additional coal resource potential exists in 3-4 additional seams >1m, and up to 3.5m thick that has been intersected as shallow as 34m;
  • Cumulative coal thickness to date is 17 metres across 17 seams intersected;
  • Exploration to date shows little to no structure, no gas and a very shallow dip 0.4 to1 degree;
  • CMR is well funded for ongoing exploration to determine the extent of coals on the Project area, with 2nd phase drilling underway, followed by a pre-feasibly study.

12th August 2014: CMR Coal (“CMR” or “the Company”) is pleased to announce a maiden JORC Inferred Resource at its flagship Dawson West Project with a total JORC Inferred Resource of 119 Mt of export quality thermal coal.

CMR’s Dawson West Project is located 40kms southwest of Moura coal rail infrastructure, which links to the coal terminals at the Port of Gladstone.

Resource Overview

Following completion of the June 2014 initial exploration programme at Dawson West, the geological data obtained has been compiled and loaded into the Company’s geological model to ascertain an Inferred JORC Resource of 119Mt of export quality thermal coal.

Coal Quality

Particularly encouraging in the initial coal analyses is the banded bright coal character with low ash and low sulfur and indications of swell. Raw Coal Quality was in-line with expectations and it is anticipated the final product specification will deliver potentially high yield over 50% while producing a 7.0% ash product with an acceptable energy content of 6,879 k/cal adb with low sulfur levels of .052%.

A&B Mylec Pty Ltd has managed the coal quality process with ALS laboratories and has provided the following commentary:

“Exploration drilling for CMR’s Dawson West Coal Project has commenced with the first HQ bore core presently being analysed at the ALS Coal Richlands laboratory. Initial analysis results indicate that the Dawson West deposit is a high volatile bituminous coal which would make a thermal coal suitable for the export market. Two coal seams have been intersected, with the 2.63m thick ‘M’ seam showing potential for exploitation. The thinner (0.53m) ‘N’ seam lies 5m below the ‘M’ seam, and has a raw ash of 27.9 %db.

The ‘M’ seam was sampled as four plies, with ply ashes ranging from 7.9% to 27.1 %ad, with the entire seam raw ash being 17.6 %ad. Full washability testing is currently in progress; however a cut-point product sample generated by Float/Sink at a low specific gravity of 1.35 suggests that a product representative of typical Hunter Valley and Gunnedah Basin thermal coals can be achieved at a yield over 50%. The limited data to date indicates that the Dawson West product would meet typical Newcastle export thermal coal Calorific Value GAR and GAD benchmark specification, which presently trades at around US$73.50 per metric ton FOB. All coal quality parameters including total sulfur, chlorine and HGI lie within desired quality ranges.

Coal classification, product options and coal utilisation potential will be further assessed as more data from the drilling programme becomes available.”

A&B Mylec is a consulting team of experienced professionals that has been providing metallurgical, process engineering and coal technology expertise and solutions to the Australian and International coal mining industry for nearly 20 years. Services span the earliest stages of mine site exploration, development and evaluation, incorporating all stages of project investigation and feasibility, through to detailed process design, implementation, market definition and support. Apart from serving major international mining companies through to junior exploration companies in the Australian coal mining industry, A&B Mylec also undertakes metallurgical and coal quality evaluation work in South Africa, Mozambique, Botswana, Mongolia, Russia, Indonesia, Canada, Colombia and the USA.

CMR’s Managing Director, Nicholas Williams commented:

“This is a very exciting discovery for CMR as we have identified a new coal precinct in Queensland that has been unexplored to date, and is ideally located close to existing operating mines in Moura & Theodore, with great access to infrastructure including, rail, water, power and very little to no environmental constraints”.

“The Project has benign to no structure, with good seam continuity in the area we have conducted exploration and the defined resource is well suited to underground mining methods”.

Mr Williams added, “CMR has only explored a small area of the total project and is confident in finding these coal seams at shallower depths amendable to open-cast mining”.

“CMR has worked closely with all stakeholders and is committed to maintaining & developing strong relationships with landowners, native title groups and providing revenue for local businesses in the area with our ongoing, planned exploration to develop this project into a future mine to export coal to the international market”.

“We will continue the exploration program at the Dawson West Project with a view to upgrading the resource as quickly as possible, whilst improving our data set for use in a pre-feasibility study”.

“CMR is committed on maintaining low exploration costs, to take advantage of the current cyclical low-point by optimising exploration at a point where the supply of equipment and human resources is available at significant discounts to previous pricing”.

“In partnership with the ASF Group, CMR is well funded to continue exploration on Dawson West and additional projects within our portfolio, focusing on Styx Coal, Biloela, South Rolleston and Dromedary Projects over next 6-12 months”.

Dawson West Exploration Strategy

Exploration is continuing at Dawson West, with the second phase 13 hole program underway, with the aim of converting part of the deposit to JORC (2012) compliant Indicated Resource status. Once complete, CMR will commence a pre-feasibility study, looking at alternative mining methods and tonnage options to optimise the possible mining parameters. This drilling will focus on the north-east areas as these appear to have optimal thickness and improving coal quality whilst being closer to existing rail infrastructure.