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Additional	Information
Market:	ASX
Sector:	Coal
Epic:	ASX:BLK
News:	Latest news
Web Site:	Blackham Resources
Other Articles:	30-11-200923-06-200929-05-2009

Blackham Resources shares spike 37% on Scaddan news

Shares in Australian energy company Blackham Resources (ASX: BLK) have soared more than 37% after the company reached a significant milestone in the development of its Scaddan and Zanthus Energy Projects in Western Australian

In a statement, the company confirmed it had signed an agreement with Synfuels China regarding the establishment of Coal-to-Liquids (CTL) Fischer-Tropsch Diesel Facility in the Esperance Region of Western Australia based on Synfuels China technology.

Following the announcement, shares in Blackham jumped 9c, or 37.5%, to 33c.

Under the terms of the non binding Memorandum of Understanding (MoU) Blackham and Synfuels China have agreed to conduct various technical and project related evaluation activities over the coming months, with a view to signing a formal agreement with respect to the application of Synfuels China technology to the development of the Scaddan project.

It is expected the formal agreement, subject to the positive outcome of technical and project evaluation by Synfuels China, will be executed by the second quarter of 2010.

Following the project evaluation, feasibility and a formal agreement, Synfuels China would have the priority opportunity to negotiate to undertake the whole project design in Blackham’s CTL FT Diesel Facility. After the Esperance Facility is successfully started-up, Blackham and Synfuels China will establish a feasible commercial co-operation model to promote the prompt industrialisation of Synfuels China technology in Australia.

Blackham chairman Brett Smith said coal to liquids in China was advancing at a rapid rate, faster than any other country in the world.

"Blackham is excited about its relationship with Synfuels China and looks forward to working closely with one of the world’s premier CTL engineering and technology firms in the development of the Esperance Regional Facility," Mr Smith said.

“Blackham intends to dry the lignite to an acceptable level for the gasifier prior to gasification.

The innovative drying technology developed by Synfuels China is of significant interest to Blackham."

Synfuels China is recognised as a world-leader in the development of CTL projects, having carried out long term research and development in the coal-to-liquids field and is accumulating production experience following the commissioning of the Inner Mongolia Yitai Group, Ordos plant and the Luan Group’s Shanxi demonstration plants.

The plants are both currently operating at 4,000 barrels per day. Synfuels China’s technology is also to be used in Shenhua Group’s 4,000 barrel per day FT CTL plant in Ordos, Inner Mongolia.

All three of these demonstration plants are planned to be expanded to over 120,000 barrels per day within 12 months.

Prior to entering the MOU, Synfuels China reviewed the lignite analysis for the Scaddan and Zanthus Energy Projects. Blackham will now provide lignite samples to Synfuels China for testing and evaluation by Synfuels China.

The samples provided were drilled with a sonic rig to ensure minimal contamination and Blackham is confident that this is a good representative sample from the middle of the deposit where Blackham intends to commence mining.

Blackham is evaluating the development of the Scaddan and Zanthus Energy Projects into Australian’s premier CTL FT Diesel Facility, with the company currently controlling a combined lignite resource in excess of 1.11 billion tonnes estimated in accordance with the JORC Code.

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