Bluff Maiden resource confirms mine potential by 2014

THE maiden resource estimate for Carabella Resources’ Bluff prospect in Queensland confirms it has the potential to support a 1 million tonne per annum open cut mine for over 10 years by 2014, according to the company.

Lou Caruana

Following the completion of Carabella’s 2012 drilling program, a total JORC resource of 18.2Mt has been defined comprising 6.6Mt of indicated resources and 11.6Mt of inferred resources.

In addition, an exploration target of 5-33Mt has also been identified and a drilling program is being undertaken with the aim of upgrading the resources estimate, the company said.

“The coal quality of the Bluff deposit is attractive, with inherently low ash and sulphur content,” the company said. “A large proportion of the coal is expected to be sold as unwashed PCI product with overall yield of about 90% expected.”

A concept study is underway and is expected to be completed in April.

This will transition into a feasibility study pending a positive outcome. Early results indicate that a low-CAPEX, high-margin operation can be expected. The high-yielding coal has the benefit of significantly lowering unit operating costs, Carabella managing director Anthony Quin said.

“Carabella continues to achieve solid progress with its Bluff Project,” he said. The lodgement of the Mining Lease Application and Environmental Authority application in February is an important milestone for the company. We have progressed the drilling program into the recently acquired tenement CLER 3158A and have established continuity of seams into this area.

“The maiden JORC Resources Estimate for the Bluff deposit also supports our plan for a small scale open cut mining opportunity that can be developed on a fast-tracked basis. Further exploration success in the area could provide additional upside for the envisaged operation.

“Carabella remains on track for project approvals and commencement of mining at Bluff in early 2014.”

The drilling program that is underway is expected to be completed by the end of 1H 2013.

The results of the drilling will provide greater confidence in the resource and allow Carabella to optimise its mine design as it progresses with its project studies, according to the company.

Preliminary off-take discussions with various parties have indicated strong interest in the quality of Bluff PCI coal, it said.