(MENAFN- ProactiveInvestors - Australia) Cougar Energy (ASX: CXY) has kicked off Phase 1 of its drilling program designed to define a maiden JORC Resources at its Mackenzie PCI grade coal tenement in the Bowen Basin, Queensland.
"We are excited for shareholders to have reached this point in the Mackenzie drilling program as we move further with our strategy to unlock the potential value from our conventional coal assets," managing director Rob Neill said.
The company has completed the requisite landowner and cultural heritage approval processes for the six-hole program, which is part of the company's plan to unlock the value of its Mackenzie and Wandoan coal assets in Queensland.
Drilling is being funded by the recent A$1 million share placement to institutional and sophisticated investors.
The drilling program will be targeting the Aries and Pollux coal seams, both of which are present in the nearby Jellinbah (PCI) and Yarrabee (PCI and Thermal) coal mines.
A maiden JORC resource is expected to be released by the end of June 2013.
Mackenzie
Mackenzie (EPC 1445) covers a 21 square kilometre area about 25 kilometres northeast of Blackwater.
It has an exploration target of 120 million to 170 million tonnes of PCI grade coal and has excellent infrastructure availability.
This includes a road used for haulage of coal from the Yarrabee mine that runs north to south through the area covered by EPC 1445. The haul road leads to a rail loop and loading facility some 26 kms away connecting into the Blackwater rail line which transports coal to the Port of Gladstone.
The coal resources within the region are contained within the Upper Permian Rangal Coal Measures which produce export quality PCI and Thermal grade coal.
The coal seams at Jellinbah and Yarrabee, which are separated by the the Yarrabee Fault, are the Aries, Castor and Pollux Seams.
A potential ROM 3.0 Mta underground longwall mine is being investigated by the company and is currently conducting an internal time and cost study to better understand the project economics.
As part of the current drilling program at Mackenzie, Cougar Energy will also carry out extensive coal quality testing to understand the coal specifications and possible yield factors to plug into its internal project economic modelling.
Cougar is also seeking strategic investors in the Mackenzie project and/or a potential cornerstone investor in the company, while also completing the evaluation, at a scoping level, for options relating to its Wandoan Thermal coal project (JORC 360 Mt) and its Kingaroy coal asset (JORC 73 M) both in the Surat Basin).
"The Mackenzie coal asset is one of the last remaining Metallurgical (PCI) grade coal assets where potential strategic or cornerstone investors can secure a position in the tightly held Bowen Basin." Rob Neill told Proactive Investors.
Analysis
Defining a maiden JORC Resource that validates the PCI coal asset at the Mackenzie Project is a key catalyst that could take Cougar Energy beyond its current market capitalisation of $6.63 million.
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