Overview NGF has outlined a target of 35 to 40 million tonnes of open pittable PCI coal at its Norton (EPC 1033) project in the Bowen Basin near the town of Middlemount in central Queensland. A recent 1,572 metre drilling program intersected target seams in the Rangal Coal Measures at shallow depths of 22 metres to 137 metres. The drilling intersected the Leichhardt Seam and the Vermont Upper Seam at thicknesses of 2.2 to 5.6 metres and 0.6 to 2.7 metres respectively. Overall, the depth and thickness indicate the potential for an open cut mining operation. Core analysis indicates an attractive washed product similar to the ultra low volatile PCI coals produced at the nearby Yarrabee, Foxleigh and Copperbella mines that are in strong demand by the world steel industry. NGF has now embarked on an accelerated 7,000 metre drilling program aimed at delineating the insitu coal as a JORC compliant resource. The program will comprise 60 holes and is expected to take up to six months to complete. It will be focused on the sub-crop zone of the Rangal Coal Measures on a pattern of 250 x 500 metres. An application for a Mineral Development Licence is being submitted for that part of EPC 1033 covering the PCI potential area that the company now refers to as Middlemount South. The remainder of EPC 1033 has potential for a high quality coking coal deposit and recently the company drilled two holes on the western boundary of the EPC seeking to intersect the German Creek Formation coking coal seams at a depth greater than 350 metres. The targets were similar to those mined at the nearby Norwich Park mine. Both holes were abandoned, one due to drilling issues. It is planned to deepen the hole at a later date. SMG Consultants has been commissioned to prepare an independent scoping study on the PCI potential of the Middlemount South coal project. NGF recently made an all share offer to acquire Bellamel Mining which, if accepted, will add 1.68 million ounces of gold resources to the Paddington project. Bellamel also has the potential to develop a 40,000 to 50,000 ounce per year gold heap leach operation. Additionally, that company holds properties that are prospective for underground development. NGF operates the Paddington gold operation near Kalgoorlie and is planning to develop the Mount Morgan gold project in Queensland. NGF has announced a life of mine plan for Paddington setting out a ten year mining program. The plan involves open cut mining to deliver 2.8 million tonnes per annum to the plant at a head grade averaging 1.8 g/t gold and with anticipated recovery of 93.5% will produce 150,000 ounces of gold annually. A further 0.5 million tonnes per annum of high grade underground and open cut feed is expected to generate an additional 100,000 ounces per year. Impact NGF has acquired the right assets at the right time. It has just unveiled a target of 35 to 40 million tonnes of PCI coal in the Bowen Basin that is close to existing infrastructure. The company has the management in place to develop this resource with the chairman and managing director previously serving on the Felix Resources (FLX) board. The acquisition of the Paddington gold assets was performed at a time of relatively low gold prices and this should afford the company some latitude in dealing with a large number of modest gold resources needed to feed its hungry Paddington plant.
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