ATQ 0.00% 43.0¢ atomic resources limited

Level 2, 41-47 Colin Street, West Perth WA Australia 6005PO Box...

  1. 442 Posts.
    Level 2, 41-47 Colin Street, West Perth WA Australia 6005
    PO Box 636 West Perth WA Australia 6872
    Tel 61 8 9322 2033
    61 8 9322 2055
    Fax 61 8 9322 2100
    www.atomicresources.com.au
    [email protected]
    20 September 2010 10-56
    ASX Code: ATQ
    Company Announcement Officer
    Australian Securities Exchange
    MBALAWALA FEASIBILITY STUDY, INITIAL RESERVE, INCREASED RESOURCE
    AND NGAKA EXPLORATION UPDATE
    HIGHLIGHTS
     Positive Bankable Feasibility Study completed;
     Mbalawala Mineable Reserve of 40 million tonnes;
     Mbalawala resource increases 18% to 251 million tonnes;
     160-320 million tonne Exploration Target1 defined at Mbuyura/Mkapa;
     Surface drilling programme planned to expand resource base.
    Atomic Resources Limited (?Atomic?) is pleased to announce completion of a Bankable Feasibility Study
    for a proposed open pit mine at Mbalawala, with an initial reserve of 40 million tonnes. The Study
    incorporates a significant 18% increase in the combined coal resource for the Mbalawala Block, from
    212 to 251 million tonnes. The Mbalawala Block covers an area of approximately 154.8km2 and is
    located within the Ngaka Coalfield in the south-western region of Tanzania.
    In addition to this, Atomic has identified an Exploration Target1 range of between 160 and 320 million
    tonnes for the relatively under-explored northern sub-basins of the Ngaka Coalfield, i.e. the
    Mbuyura/Mkapa Blocks.
    An exploration campaign of more than 50 surface boreholes will commence this year with the drilling
    programme extending well into 2011. Additional concessions over the coalfields of Liweta, Mbamba Bay
    and Mhukuru remain largely untested and may represent considerable upside coal potential.
    Release of Bankable Feasibility Study Including Maiden Reserve
    Wave Engineering Solutions has released a Bankable Feasibility Study in September 2010 considering
    the commercialisation of a thermal coal resource. This study confirms the economic viability of Atomic?s
    coal reserves at Mbalawala Block, Ngaka Coalfield. The reserve estimate used in this study was
    prepared by Coffey Mining Australia in accordance with the JORC Code (2004).
    The following input parameters were considered:
     Conventional open cast mining
     40 Mt JORC Code compliant Proved Reserve (based on Run-of-Mine cost of US$32/t)
     Local market to supply 450MW power plant
     Capital cost of US$205M
     Tanzanian Strategic Investor Status and Special Mining License
    The above results in a 25 year of Life of Mine at a production rate of 1.5Mt per annum with a hurdle rate
    of 25% . This is without the additional exploration that will be performed over the next few years.
    The study indicates that there is high potential to increase the Proven Reserve component of the
    Measured Resource, in both open cut and underground mining areas, by continued mine development
    planning. A review of the modeled coal outside of the ultimate pit design has defined a potential
    underground mining inventory of 40Mt tones of coal.
    Atomic?s joint venture partner in Tanzania, the National Development Corporation (?NDC?) have
    indictated their satisfaction with the BFS at this stage.
    Mbalawala Resource Update
    The coal resources of the Mbalawala Block are located within the southern portion of the Ngaka
    Coalfield. This area was the focus of intense geological and resource studies by the Colonial
    Development Corporation (?CDC?) in the early 1950?s. Investigations for economic quantities of thermal
    coal were also conducted by geologists from the Tanzanian Geological Survey (?TGS?), NDC and most
    recently Atomic?s local operating arm, Tancoal Energy Limited (?Tancoal?).
    The assessment of the Coal Resources (Table 1) has been prepared by Ravensgate geological
    consultants in accordance with the Australian Code for Reporting of Exploration Results, Mineral
    Resources and Ore Reserves (JORC Code, 2004). The wireframes and block models used in the
    calculation of the resource estimates were also generated by Ravensgate using MED System Mine
    evaluation software.
    The resource estimate is based upon all data made available to the NDC and TGS, which includes 27
    boreholes completed by the CDC in 1955. Data from two modern diamond drilling campaigns
    implemented by Tancoal are also included. The initial Tancoal 2008 diamond drilling program of 19 holes
    verified and validated the CDC?s historical geological and analytical data. Ten additional follow up and
    infill holes were completed by Tancoal during 2009/2010.
    Table 1. Mbalawala Coal Resources, Ngaka Coalfield.
    Resource Category Measured Indicated Inferred Totals
    Tonnes (million) 139 66 46 251
    Inherent Moisture % 2.9 2.77 2.62 2.8
    Ash % 18.9 19.03 23.81 19.9
    Fixed Carbon % 52.0 51.41 46.26 50.8
    Volatile Matter % 26.3 26.87 27.32 26.6
    Calorific Value kcal/kg 6,326 6,350 5,937 6,257
    Total Sulphur % 1.4 1.27 0.78 1.3
    Specific Gravity 1.5 1.49 1.55 1.5
    Notes:
    1) Coal Resources have been rounded to appropriate levels of accuracy in accordance with the JORC Code (2004)
    2) The estimates of Coal Resources in this table have been carried out by Ravensgate geological consultants in accordance with the
    JORC Code (2004)
    3) Coal resources are reported inclusive of coal reserves (i.e. coal reserves are not additional to coal resources)
    4) Coal quality data reported is based on weighted averages for all seams
    5) The Inherent Moisture is reported on an ?as received? basis; all other analysis are reported on an ?air dried basis?.
    6) A relative bulk density of 1.4 tonnes / cubic meter ?in-situ was applied to tonnage calculation based on the default derived from
    analysis, and the bulk density was also modeled.
    Mbuyura/Mkapa Exploration Target1
    The Mbuyura/Mkapa Blocks were subject to considerable historic exploration activities also performed by
    CDC during the late 1940?s and early 1950?s. 13 holes were drilled, accompanied by detailed mapping,
    trenching, pitting and auger drilling. Tancoal drilled a further 27 holes across the area in 2009, including
    the previously under-explored northern portion of the Ngaka Coalfield.
    Review and re-analysis of historical and recent Tancoal drilling data has resulted in an Exploration
    Target1 range of 160 to 320 million tonnes to a depth of 500 meters. Lower and upper ranges (Table 2)
    take cognisance of reasonable assumptions with regard to seam variability, continuity and thickness.
    Table 2: Exploration Target1 ranges.
    Seam Surface to 50m depth (Mt) 50m to 500m depth (Mt) > 500m depth (Mt)
    Seam 4 (a, b, c) 8 - 17 35 - 70 5 - 10
    Seam 3 (a, b) 12 - 23 105 - 210 65 - 130
    Total 20 - 40 140 - 280 70 - 140
    Exploration Update
    Interpretation of all data, including recent analytical results, is ongoing and a geological model of the
    Mbuyura/Mkapa Blocks is currently being developed by Tancoal and Shango Solutions, independent
    geological consultants to Atomic. Work to date indicates reasonable seam correlation and continuity
    across these blocks.
    The geological models being developed will also increase confidence in the exploration strategy for the
    Ngaka Coalfield. This will include identification of areas where additional exploration data, in particular
    seam continuity and characteristics, including coal quality information. This will improve confidence
    levels in the geological understanding of the Coalfield and associated resources.
    As announced by Atomic on the 29th April 2010, Tancoal has acquired an additional concession,
    PL6285/2009, that contains the southerly extent of the Mbuyura/Mkapa Blocks. Coal seams could
    continue for at least 1.5km into this Nyakangunda concession and therefore additional upside coal
    potential exists. No exploration activities have yet been carried out on this new concession.
    A new exploration campaign is planned in the Ngaka Coalfield for late 2010 to early 2011. Some 52
    diamond drillholes are planned to approximate depths of 40 to 600m below surface. This programme
    focuses on expanding the existing Mbalawala resources in the down-dip and strike directions, as well as
    increasing confidence in the Mbuyura/Mkapa Blocks and Nyakangunda sufficient to establish maiden
    JORC compliant resources.
    In addition to the Ngaka Coalfield, Atomic holds prospecting rights over the coalfields of Liweta, Mbamba
    Bay and Muhukuru that have known coal occurrences indicating good prospectivity for thermal coal.
    However, these areas remain largely untested and may represent considerable upside coal potential for
    Atomic. Exploration is planned over these areas to confirm the historic work and fully assess the
    potential to establish JORC compliant resources.
    ENDS
    1 The potential quantity of coal presented is conceptual in nature and there is insufficient exploration data currently available to define a Mineral
    Resource in this area under the JORC (2004) Code. The nature of an Exploration Target is such that it is uncertain if further exploration will
    result in the determination of a Mineral Resource.
    Competent Person?s Statement
    The Coal Reserves quoted in this announcement are based on the Mbalawala Coal Mine Bankable
    Feasibility Study as at 13 August 2010, compiled by Mr Robert Gracey, who is a Member of the
    Australian Institute of Mining and Metallurgy (AusIMM) and an employee of Coffey Mining, independent
    consultants to Atomic Resources Limited. Mr Gracey has sufficient experience as to qualify as a
    Competent Person as defined in the 2004 edition of the ?Australian Code for Reporting of Mineral
    Resources and Ore Reserves?. Mr Gracey consents to the inclusion in the report of the matters based on
    his information in the form and context in which it appears.
    The Coal Resources quoted in this announcement are based on the Resource Model Assessment and
    Review, Ngaka Project Area as at 20 July 2010, compiled by Mr Edward Radley, B.Sc. Geology, who is
    a Member of the Australian Institute of Mining and Metallurgy (AusIMM) and a Senior Resource
    Consultant for Ravensgate, independent geological consultants to Atomic Resources Limited. Mr Radley
    is a registered professional geologist with sufficient experience as to qualify as a Competent Person as
    defined in the 2004 edition of the ?Australian Code for Reporting of Mineral Resources and Ore
    Reserves?. Mr Radley consents to the inclusion in the report of the matters based on his information in
    the form and context in which it appears.
    The information in this announcement as relates to the Bankable Feasibility Study are based on the
    Mbalawala Mine Bankable Feasibility Study with related infrastructure feasibility options as at 31 August
    2010, verified by Mr John Kelly, B.Eng (Mining), who is a Member of the Australian Institute of Mining
    and Metallurgy (AusIMM) and Director of Kelly Consulting, for Wave Engineering Solutions, independent
    engineering consultants to Atomic Resources Limited. Mr Kelly consents to the inclusion in the report of
    the matters based on his information in the form and context in which it appears.
    The information in this report that relates to mineral resources is based on information compiled by Mr
    G?khan G?ler, who is a member of a Recognised Overseas Professional Organisation (ROPO) included
    in a list promulgated by the ASX from time to time (The South African Institute of Mining and Metallurgy).
    Mr Guler is employed by Shango Solutions geological consultancy and is also a director of the company.
    Mr Guler has over 15 years experience which is relevant to the style of mineralisation and type of deposit
    under consideration and to the activity which he is undertaking to qualify as a Competent Person as
    defined in the 2004 edition of the ?Australasian Code for Reporting of Exploration Results, Mineral
    Resources and Ore Reserves?. Mr G?ler consents to the inclusion in the report of the matters based on
    his information in the form and context in which it appears.
    ENDS
    About the company:
    Atomic Resources Limited is an Australian-based exploration and resource development company with major
    thermal coal assets in Tanzania. Our operating arm in Tanzania is Tancoal Energy Limited, which was formed by a
    Joint Venture between Atomic Resources Limited and the National Development Corporation of Tanzania (NDC).
    Forward-Looking Statements
    Certain statements made during or in connection with this statement, including, without limitation, those concerning
    exploration targets, contain or comprise certain forward-looking statements regarding Atomic?s exploration
    operations, economic performance and financial condition. Although Atomic believes that the expectations reflected
    in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to
    have been correct.
    Accordingly, results could differ materially from those set out in the forward-looking statements as a result of,
    among other factors, changes in economic and market conditions, success of business and operating initiatives,
    changes in the regulatory environment and other government actions, fluctuations in metals prices and exchange
    rates and business and operational risk management. Atomic undertakes no obligation to update publicly or
    release any revisions to these forward-looking statements to reflect events or circumstances after today's date or to
    reflect the occurrence of unanticipated events other than required by the Corporations Act and ASX Listing Rules.
    For further information contact:
    Shareholder Enquiries
    Clinton Cain
    Managing Director
    Atomic Resources Limited
    Tel: (08) 9322 2033
    www.atomicresources.com.au
    Media Enquiries
    Tony Dawe
    Dawe Media Group
    Tel: 041 3322 110
    [email protected]
 
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