Based on the drilling undertaken by Riversdale the total resource is estimated to be 1.94 billion tonnes categorised as Inferred Resources in accordance with the JORC Code 2004. Of this, 1,070 million tonnes is less than 300 m deep and likely to be amenable to open cut mining. A total of 20 seams have been identified and correlated over the licence area. Fourteen of these seams, identified as A (lowest) to N (highest), have been included in this assessment. The other seams have inadequate intersections to be included in a JORC compliant report at this stage.
Inferred Coal Resources, Benga Coal Licence (EPL881L) Mozambique
--------------------------------------- Depth Increment Inferred Resources (m) (Mt) --------------------------------------- 0-100 290 100-300 780 0-300 1,070 300-500 580 >500 290 --------------------------------------- Total 1,940 ---------------------------------------Based on initial washability analyse the potential coal products after beneficiation which could be produced from Benga include:
- An export hard coking coal at 10% ash
- A secondary thermal coal product, consisting of an export thermal coal at approximately 20% ash and/or a domestic thermal coal at approximately 35% ash.
Riversdale Chairman and CEO Mr. Michael O'Keeffe said that the definition of a JORC compliant Coal Resource of this magnitude confirms the huge potential that exists in the Moatize Basin in Mozambique.
"Riversdale has a dominant land holding position in a region that we believe is going to play a major part in supplying high growth regional and international economies. The confirmation of both the size and the nature of the Coal Resource are having a material impact on our business. It will also be beneficial to our partners in the licence, Tata Steel," Mr O'Keeffe said.
"We are perfectly positioned to exploit the potential of this region. The Moatize area is world-class. Riversdale previously confirmed a Coal Resource that justified it moving to the next level of project feasibility, and this expansion of the coal resource underlines that position. The participation of Tata Steel in the project is positive in every respect and we are happy to have them as partners in this development," Mr O'Keeffe said.
"Over the coming months we will complete a large diameter coring programme and analyse this to properly understand the best way to prepare the Benga coal for the market. Additional slim coring and laboratory analyses will be completed to elevate the Coal Resource to JORC-compliant Measured and Indicated categories as a prelude to completing a bankable feasibility study for end-2008. Exploration is also being undertaken on surrounding tenements."
Benga Coal Project
The Benga Licence comprises 4,560 hectares of Riversdale's total holding in Mozambique of over 290,000 hectares.
In August 2007 Riversdale signed a Memorandum of Understanding with Tata Steel Limited ("Tata"), under the terms of which Tata acquired a 35% interest in two of Riversdale's key Mozambique exploration tenements, including the Benga Licence, as well as offtake rights to 40% of the coking coal produced.
In the same month the Company acquired an extensive portfolio of tenements from Aquila Resources Limited (ASX: AQA and "Aquila"), located in the Tete province, contiguous with tenements already held in Mozambique by Riversdale and those held by one of the world's largest mining groups, Vale (formerly CVRD).
The acquisition positions Riversdale as the largest tenement holder in Tete-Moatize, with an extensive area capable of supporting long life operations in this emerging and highly prospective region.
The information in this announcement is based on Report No 269/01/01, Coal Resources, Benga Project as at 31 March 2008, compiled under the supervision and reviewed by Mr. Kerry Whitby, who is a Fellow of the Australasian Institute of Mining and Metallurgy and Managing Director of McElroy Bryan Geological Services Pty Ltd (MBGS).
Kerry Whitby has more than 30 years experience as a geologist in the resources industry and more than 20 years experience in the estimation of coal resources for coal projects and coal mines both in Australia and overseas. This expertise has been acquired principally through exploration and evaluation assignments at operating coal mines and for coal exploration areas in Australia's major coal basins throughout the world. With this level of experience, he is adequately qualified as a Competent Person as defined in the 2004 edition of the JORC Code.
The Coal Resource estimate for the Benga Licence, (881L) Mozambique presented in this report has been carried out in accordance with the "Australasian Code for Reporting of Mineral Resources and Ore Reserves" (September 2004) prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia.
Tata Steel Limited
Riversdale Mining Limited
Aquila Resources Limited