“I am often asked about the progress of our agreement with Rio Tinto Exploration. I can confirm that our agreement with them remains very much alive and we are now awaiting the option exercise date being August 23, 2015,” Byrne said.
“Rio have taken initial steps towards the expansion of their Hail Creek mine. This development planning includes areas that are covered by our Mt Hillalong JV tenements.”
Under the Mt Hillalong project joint venture with Rio, the major will solely fund and manage the exploration program on EPC 1824 to exercise the right to earn a 75% working interest.
The two-year commitment period for exercise of the option started on August 23, 2013 and results from drilling undertaken is being assessed.
Mt Hillalong is close to Rio’s Hail Creek mine – which produces 8 million tonnes per annum of hard coking coal – part of the major’s main coal hub.
Byrne took the opportunity in APC’s latest quarterly report this week to remind investors that over the past years the junior has collected “a pool of valuable projects” which it has identified as “high quality projects with good development potential”.
These include APC’s South Clermont project in its 100% owned EPC 2011 tenement, which abuts Glencore’s (formerly Rio’s) Clermont coal mine purchased for $1 billion (for a 50.1% share). Clermont produces more than 10Mtpa.
A drilling program is required to elevate APC’s South Clermont project to a measured JORC resource, targeting the Clermont Basin with the potential for thick open cut mineable coal seams.
If the average thickness of the main seams in neighbouring mines (Blair Athol 29m and Clermont 38m) are anything to go by, APC is looking at an impressive project.
South Clermont is near two rail networks which provide access to major coal ports at Mackay and Gladstone.
“This has been a difficult period in which to secure funding for exploration,” Byrne said in the quarterly.
“We continue to attract interest in our projects and there is clear recognition by potential investors that our company holds valuable projects.
“However, within the current risk-averse economic environment, potential investors are generally only negotiating to secure their place in the future development of our resources. “Our negotiations with these potential investors are always conducted to ensure that the financial returns from development of our resource assets will benefit our shareholders.”
