Montem Resources Limited's (ASX:MR1) coal quality testing on drilling samples from Chinook Vicary area of its Chinook Project in Alberta, Canada, have confirmed the presence of Tier 1 hard coking coal (HCC).
Results from tests on large-diameter core samples carried out in the December quarter of 2020 have been analysed, with coal quality and carbonisation results confirming the occurrence of high-quality low volatile HCC.
Samples returned exceptional coke strength results with CSR values ranging from 67 to 74.
The working section clean coal composite produced high simulated plant yields with low ash at 9.1%, low volatile matter at 21.4%, low total sulphur at 0.48%, a favourable rank (RoMax) at 1.31%, and an outstanding CSR of 70.
“Exceptional coal quality”
The results validate historical coal quality test-work and mined product coal specifications at Chinook, confirming that the product coal quality aligns with the quality of globally traded Tier 1 HCC, including those product coals produced at nearby Teck Resources Ltd (TSE:TECK) (NYSE:TECK) mines in the Elk Valley.
Montem managing director and CEO Peter Doyle said: “We are excited the Chinook Vicary coal quality results confirm Tier 1 hard coking coal.
“The historical Vicary mine sold 100% of its product to Japanese steelmakers in the 1970s.
“When we met with these same steel making companies in Tokyo, they remarked on the exceptional quality of the coal from Vicary and showed us the product specification from the old mine.
“So, we always knew there was potential for high-quality coal at Chinook, and we are really pleased to confirm this with the current drilling.
“To get CSR’s over 70 for a low-volatile hard coking coal, puts Vicary firmly in the top bracket of hard coking coal available on the global market.”
Shares have been as much as 6.5% higher this morning to A$0.175.
“Impressive washability results”
In total, 53 raw samples, 23 sizing and washability samples, and six clean coal samples were collected from the three coal seams.
The results varied by seam, but overall were encouraging, with excellent washability and clean coal results for Seam 2 and Seam 4 in addition to exceptional carbonization results for Seam 4.
Doyle said: “The washability results from Seam 2 and Seam 4 are impressive, with simulated plant yields around 75%.
“Seam 4 in the area drilled was over 15 metres thick and accounts for approximately 45% of the total resource in the scoping study Vicary pits.
“With these results, and the scoping study mine plan, the potential for a high-quality, low cost, Tier 1 hard coking coal mine is now confirmed.”
Cross-section B-B showing potential low strip-ratio pit shell at Chinook Vicary.
Additional test-work planned
Montem plans to complete additional test-work on intersections of Seam 2 to further define its product coal carbonisation potential and marketability.
The 2020 clean coal results and historical coal quality results for Seam 2 at Chinook Vicary are indicative of potentially favourable high CSR results (>65%) from proposed future test-work.
Additionally, Seam 5 also requires further test-work to confirm the low yielding nature of the 2020 washability samples is a localised event.
The company’s proposed 2021 Chinook exploration program, commencing in the second half of this year, will complete these works and produce a comprehensive coal and carbonisation assessment inclusive of details on individual coal seams and typical product blend characterisation.
The project is made up of two areas, Chinook Vicary and Chinook South, and contains a coal resource estimate of 149.1 million tonnes (103.8 million tonnes indicated and 45.3 million tonnes inferred) and a coal exploration target estimate of an additional 125-450 million tonnes at Chinook Vicary.
Notably, the entire Chinook Project is within Alberta Coal Policy Category 4 lands, where surface mining is contemplated.
Doyle said: “The next step, later this year, is to drill out the remaining areas included in the scoping study mine plan, and progress to a pre-feasibility study.
“As the entire Chinook Project lies within Alberta Coal Policy Category 4 lands, we will continue exploration and mine planning.
“We are excited by Chinook and look forward to the next phase of development.”
The company will now use the coal quality results and new geological information from the 2020 exploration program to update the Chinook Vicary JORC resource estimate, expected in quarter two of 2021.