During the March quarter Stage 2 of exploration at its 50%-owned Peak Downs East underground coal project in the Bowen Basin continued, focusing on the northern part of the resource. Exploration is assessing coke strength, gas regimes and structural constraints.

 

While preliminary results indicate hard coking coal, an initial resource statement will be issued during the June quarter.

 

A decision is expected by July 19 from CVRD upon completion of its $A17 million exploration study. The Brazilian miner will decide whether to exercise a 51% purchase option payable to Aquila and AMCI at $US45 million each.

 

In other exploration work during the quarter, Aquila drilled 33 open holes, including three partly cored 100mm holes at its Washpool project in the Bowen Basin. The company said the project has potential as a coking and thermal coal opencut mine.

 

Letting Aquila down was its Isaac Plains coal handling and preparation plant, which was due for completion last quarter but has been delayed due to it not consistently maintaining nameplate capacity. CHPP troubles have reduced coal mining to 52% of budget.

 

Aquila was trading at $A4.55 this morning.