TCM - Tiaro Coal [Archive] - Sharetrader Forum

mark100

11-08-2010, 01:06 AM

Ferret's stock to watch
August 10, 2010 - 10:40AM
RWE
OVERVIEW: Tiaro Coal Limited:
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Here is another Queensland coal explorer flexing its muscles but it's early days yet.
At a bit over 52c, shares of Tiaro Coal look prospective with a number of new targets identified for further exploration and drill testing.
The results have significantly expanded the target areas beyond the Munna Creek and T9 targets, that were previously identified and where a resource estimation program is underway.
Following further analysis of drill results and coal quality testing, an increase in the resource target over Munna Creek and T9 is expected.
Referring to its gravity survey, the company said that in May and July, Precision Exploration Services completed 450 new gravity stations within the Tiaro joint venture EPC areas.
The areas surveyed included the area to the south of Munna Creek, extending the gravity work completed in Shady Camp/T9/Munna area in November.
Several potential gravity target areas from Munna Creek to Curra in the south of EPC 956 were identified from this work.
Gravity surveys were also completed in the area north of T9 (EPC 957 and EPC 972), including follow-up stations in the Shady Camp East area, which was highlighted as a potential target in the 2009 survey.
A small survey was also completed in the two retained blocks of EPC 967 (Toolara area).
Distinct gravity lows have been confirmed in these areas.
The results of this work suggested several new potential targets that should be considered for further investigation and possible drill testing.
The gravity target areas have been listed.
This is used to interpret prospective coal targets, which are identified, represented as gravity lows.
In the next phase exploration the joint venture management committees will meet early in September to finalise plans for the next phase of exploration.
Drilling to test all new targets is being considered, together with further gravity work to fully define some targets.
A component of the work will be additional mapping in all the EPC areas to confirm the drill sites are suitable, check out some areas of lower order gravity lows, and also follow up of other occurrences such as the anthracite in EPC 1540.
There is also some infill gravity planned in Toolara South (EPC 967), in EPC1553 and EPC1540, and in the SE and NW corners of T9/Munna, and some detailed gravity traversing (100m stations) on 1 or 2 selected profiles across T9.
Drilling - EPC 956 and EPC 957: A JORC definition drilling program comprising 4,747 metres over 33 holes commenced on April 14 and was completed on June 3.
Coal seams were intersected in 30 of the 33 holes to an average depth of 144 metres.
Exception holes where no coal was intersected were programmed holes to test the extremities of the Tiaro Coal Measures in the target areas Munna Creek and - T9.
Initial field results are encouraging with a large volume of coal being intersected in the formation of multiple thin seams above 0.5 metres in thickness (cut off) contained in working sections to an average depth of 150 metres.
Fifty two samples have been delivered to ACIRL laboratory in Brisbane for testing.
The samples will be analysed for raw coal quality, including ash, CSN, sulphur and CV. Selected samples have been submitted for petrographic testing to determine rank variation across the deposit, HGI, ash fusion and ash analysis.
A large amount of geotechnical data has been amassed as a result of this program.
This data will now be the foundation for analysis and possible assessment of a JORC compliant resource in the coming months.
Coal quality testing on chip samples will also be used in reference with geophysical logging and gravity data to assist in seam correlation determination and potential JORC resource determination.
SHARE PRICE MOVEMENTS
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Shares of Tiaro Coal yesterday rose 6.5c to 52c. Rolling high for the year is 52c and low 12.5c. The company has 71.2 million shares on issue with a market cap of $37 million.
Exploration Target: The prospective target zone doubled in size following the results of the gravity surveys completed earlier, with the main target area (Shady Camp in north to T3 in south) now extending over an area 15 kms long by 3-4 kms wide.
A follow-up drilling program is planned to test the northern and southern extents of this zone.
Based on the outcome of the drilling program Tiaro's technical director, Jacob Rebek is of the view that a coal resource of 20 to 30 million tonnes is achievable in the target zone.
This includes a resource target in the order of 2-5 million tonnes of high quality coking coal with 9 per cent ash in washed product at a yield of 68 per cent.
Early evidence from this drilling program has highlighted the potential for large tonnage thermal coal within the current target area and in other targets within tenements held by Tiaro over the Tiaro Coal Measures.
For example in Target Shady Camp in coal in diamond drill holes, such as those in CTD017 which include:
* A 2.60m "working section" (102.72m to 105.32m) with raw ash of 48 per cent (wash test yield at F1.60 was 41 per cent for a thermal product containing 17 per cent ash);
* A 0.30m coal seam (102.72m to 105.32m) gave raw ash of 23.3 per cent and the wash test yield at F1.60 was 71 per cent for a thermal product containing 12 per cent ash;
* A 6.06m "working section" (128.94m to 135.00m) that has not been tested by washing; and in hole CTD056 which include:
* A 2.8m "working section" (82.8m to 85.6 m) with raw ash of 47 per cent (wash test yield at F1.60 was 41 per cent for a thermal product containing 17 per cent ash); and
* A 5.3m "working section" (121.7m to 127.0m) with raw ash of 49 per cent (wash test yield at F1.60 was 39 per cent for a thermal product containing 18 per cent ash).
Additionally coal quality testing from diamond drill holes in earlier exploration programs within the target area have highlighted similar characteristics:
* A raw ash product with higher ash but with good calorific values;
* High vitrinite values;
* Good volatile matter content; and
* Good HGI index.
Coal occurrence as having coking and PCI qualities have also been identified within the target area.
A working section is at least a five-metre seam containing at least 50 per cent coal.
Accordingly it is expected that within the target area a resource containing a larger volume of thermal coal together with smaller volumes of coking and PCI coals will be defined.
Due to high specific energy, thermal coals are expected to be suitable for export markets.
Directors say they are particularly encouraged by the recent reporting by Northern Energy where it reported a probable reserve of 5.9 million tonnes of hard coking coal in a similar geological setting.
They are confident that other target areas will exist in the uncontested areas of EPCA 1264 and EPCA 1269 areas in the Burrum Coal Measures, believes Peter Meers, CEO of Tiaro Coal.
In the quarterly report to June 30 the company disclosed that initial field results were encouraging with a large volume of coal being intersected in the formation of multiple thin seams above 0.5 metres in thickness (cut off) contained in working sections to an average depth of 150 metres.
The tenements cover most of the known exposures of the Tiaro Coal Measures within the Mesozoic Maryborough Basin, located between Gympie and Maryborough in southeast Queensland.
The tenements are well serviced by nearby infrastructure, including manpower, mining support services, road, and rail and port facilities. The rail line bisects the exploration tenements.
A commodity-trading target of 12 million tonnes per annum has been set by Australian Minerals Trading Pty Ltd (AMT) a joint company of China Qinfa Group and Tiaro.
China Qinfa Group holds a coal off take agreement with Tiaro to the extent of its future production entitlement within the Tiaro coal tenements at selling prices to be determined at arm's length and on commercial terms.
BACKGROUND
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Tiaro Coal joined the stock exchange list on March 3, 2008.
The company's project is located 100 kms south of Bundaberg in Queensland and is renowned for its coal deposits.
It holds, through its wholly owned subsidiary Tiaro Energy Corporation Pty Ltd, a 33.33 per cent interest in TCJV.
The energy company holds the right to TCJV where the subsidiary has exercised an option to acquire 80 per cent interest in the TJV through the provision of $5 million exploration expenditure over the next four years.
Then there is the Dynasty joint venture.
Through a separate joint venture Dynasty Metals Australia Ltd has earned 15 per cent interest in EPC 956 and EPC 957 (Tiaro West Tenements). Tiaro has the option to increase its interest to 65 per cent in the Tiaro West tenements.
Tiaro has China Qinfa Group as a strategic partner and key shareholder to the company's register.
The Qinfa Group is a coal operator in China with businesses including purchase and sales, filtering, blending, storage, transportation and shipping of coal.