Coal Resources
- Hinton Coal Project - Aerial View
- Hinton Coal Project - Drill Hole Locations
- Hinton Coal Project - Hinton West Cross Section
- Hinton Coal Project - Hinton East Cross Section
- Hinton Coal Project - Drill Hole Locations
HCP Coal Resource Estimate
The Company has completed two JORC/NI 43-101 Coal Resource estimates on the HCP in Canada.
The Coal Resource estimates for the HCP defined an estimated 467 million tonnes of low sulphur, high volatile bituminous C thermal coal. Significantly, the Measured and Indicated Coal Resources of 421 million tonnes represent 90% of the total Coal Resource.
| Measured | Indicated | Measured & Indicated | Inferred | Measured, Indicated & Inferred | |
|---|---|---|---|---|---|
| Hinton East | 210,800 | 85,300 | 296,100 | 43,100 | 339,200 |
| Hinton West | 87,600 | 37,900 | 125,500 | 2,600 | 128,100 |
| Total Coal Resource | 298,400 | 123,200 | 421,600 | 45,700 | 467,300 |
The Coal Resource Estimate has been based on considerable drilling and exploration activities which were undertaken on the HCP by Esso Minerals ("Esso")in the 1980’s and prepared by Canadian independent technical consultants Moose Mountain Technical Services ("MMTS"). The Resource Estimates are reported in accordance with the JORC Code and the Canadian standards, National Instrument 43-101 ("NI 43-101").
The current work plan going forward will include additional interpretation of the Esso data, land reclassification of the category on Hinton West and the commencement of a two phase drilling program over the HCP. The drilling will allow the Company to update the coal quality database and will be used for washability testing to refine the coal process plant flow sheet.
Coal Quality
MMTS have completed an indicative assessment of coal quality based on historical core hole information and coal qualities of nearby mines including Coal Valley and Obed Mountain. Based on this information MMTS has indicated that the washed clean coal product could have the following characteristics:
| Coal Characteristic | Gross As Received | Air Dried Basis |
|---|---|---|
| Moisture | 11.5% | 4.5% |
| Ash Content | 11.1% | 11.9% |
| Volatile Matter | 31.2% | 33.7% |
| Fixed Carbon | 46.2% | 49.9% |
| Sulphur | 0.3% | 0.3% |
| Calorific Value | 5,758 kcal/kg | 6,212 kcal/kg |
Forecast yield is expected to be at least 50% based on the current Coal Valley operations in the region. It is noted that further testwork and engineering will be conducted during the scoping and feasibility studies to confirm and try to improve on these initial conclusions. Additional core quality drill holes and bulk test pits will be carried out with followup washability and quality testing.
Importantly, the coal quality of this product is suitable for export into the lucrative Pacific Rim markets with both Coal Valley and Obed exporting a similar quality product into these markets. The qualities of this coal, including the low sulphur content, low ash and calorific value allow it to compete against coals that are currently exported from Australia and Canada into the tier one Japanese and South Korean markets. In addition the HCP is well situated to export into the growing Chinese thermal export markets.
Geology
The Projects are located in the outer foothills of the Rocky Mountain thrust belt. The rocks form part of a thick sequence of continental sediments from the Saunders Group that overlies the marine Wapiabi Formation of the Alberta Group. The Upper Cretaceous-Tertiary Saunders Group is over 3,600m thick and is divisible into the Brazeau, Coalspur and Paskapoo formations. Although all three units include carbonaceous partings and thin coal seams, major coal deposits are restricted to the Coalspur and Paskapoo formations.
The Coalspur Formation is approximately 600m thick. A lack of mapable marker horizons, the similarity of lithologies, poor or localized outcrop exposure and incomplete sections have been the challenge of mapping the Coalspur Formation. The coal-bearing portion of the Coalspur consists of about 250m of interbedded sandstones, siltstones, mudstones, bentonitic horizons and coal, very similar to the underlying Brazeau Formation. The only significant difference is the presence of several thick coal zones with a stratigraphic interval of 250m. This coal zone is 275m above the Entrance conglomerate which forms the base of the Coalspur Formation.
The Coalspur Formation outcrops along the eastern margin of the outer foothills belt of the Rocky Mountains. Structurally, the strata in the Hinton-Coalspur area are controlled by two regional folds: the Entrance Syncline and the Prairie Creek Anticline. The regional strike is 300° and the coal dips to the northeast at 6° to 10°. There is a fault southwest of the property called the Pedley Fault that disrupts the Prairie Creek Anticline with movement in the order of 250 metres. However, on the Hinton property only minor thrust faults have been encountered in drillholes.