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Astra Resources dials into Nigerian thermal coal sector with joint venture

Thursday, December 01, 2011 by Proactive Investors

Astra Resources is one of only a handful of Australian companies exploring the Nigerian coal market, providing investors an exposure to a country developing coal-fired power plants and revitalising the local coal mining industry.

Astra Resources is one of only a handful of Australian companies exploring the Nigerian coal market, providing investors an exposure to a country developing coal-fired power plants and revitalising the local coal mining industry.

Diversified mining company Astra Resources PLC (Code: 9AR), which is the UK parent company of Astra Mining, is continuing with its global expansion at speed.

The latest instalment of Astra's growth includes the finalisation of a joint venture agreement covering Nigerian thermal coal sites, with the company already undertaking geological investigation.

The agreement, signed through Astra’s subsidiary Muyiwa Pte Ltd, gives the company a super-majority ownership of Barjalex Nig Ltd, an African company that owns a coal exploration license (10077EL) covering the Manejo and Odele communities in the Ika District of Ankpa Local Government in Kogi State, three kilometres south of Ogboyaga.
 
A geological study will soon commence and compare the licensed area with previous JORC standard reports for the Ogboyaga coal district as well as the pre-feasibility and costs for local mining and logistics for export and internal markets.
 
The resulting report on the geological investigation to be conducted should reveal a coal JORC Inferred Resource within the area and will also include proposed exploration drilling points for core drilling which will be required for ascertaining the Measured Resource estimation of the deposit.
 
Astra CEO Dr Jaydeep Biswas says undertaking these investigations will allow the company to complete one of the exploration exercises required for the fulfilling of a mining lease application.
 
“The geological investigation of the Barjalex coal properties is estimated to take 30 to 45 days with a total of five geologists,” Dr Biswas says.
 
“The study is prior to drilling and the exercise should be able to lead us to an inferred estimation of the coal resource within the area owing to the proximity of the site to the Ogboyaga coal field where previous studies for the area are available to support the work.
 
“Drilling will increase the geological confidence of the site to a proven reserve level and the work will form part of the report that will be used to assess the qualification of the Barjalex exploration licenses for a mining lease.”
 
Dr Biswas says Astra is one of only a handful of Australian companies exploring the Nigerian coal market.
 
“The Nigerian government is focusing on developing coal-fired power plants and revitalising the coal mining industry due to the major underexplored and underexploited high quality coal resources in the area.

“We are one of only a few resource companies to be active in the country, and our Barjalex exploration sites will create a beach-head for growth in a region which has the potential to host 800 million tonnes of thermal coal,” Dr Biswas says.
 
“The coal present in the district and surrounds of Nigeria is ideal for power generation and export into the international market as it is low in sulphur and ash, and high in calorific value.”
 
Astra Managing Director Silvana De Cianni says large coal reserves in the district and surrounding region can be developed into a highly economical mining venture.
 
“The site can initially be developed using surface mining technologies, however most of the coal will be exploited using highly productive longwall methods,” Ms De Cianni says.
 
“International geological and feasibility studies estimate that the total coal deposit in Nigeria is 2.6 billion tonnes, which will attend to the strong internal demand for coal with a major emphasis on local power generation. 
 
“Due to its proximity, Nigeria is in a prime position to become a major player in the international traded coal market to Europe due to the sizeable international market for seaborne trade.”
 
The reports required for a mining lease application include geological studies, drilling and resource estimation, feasibility, mine plan, an environmental impact assessment and environmental management plan, all of which are underway.
 
Once completed the report of the geological study will be forwarded to the Ministry of Mines to form part of the reports to be used to assess the qualification of the Barjalex exploration licenses for a mining lease.
 
Astra Resources’ global portfolio includes gold and iron sands interests in Southeast Asia, coal mines in Africa, iron ore in India, carbon efficient businesses, mining housing developments in Queensland and the production of the high-strength T-Steel technology in Hungary.

 

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