The resource covers 29 square kilometres and the project is adjacent to Xstrata’s Wandoan Extended mining lease.

The Norwood East block contains 120Mt of the resource and an average thickness of 4.15m of the working sections.

The Norwood West block hosts 36Mt at an average thickness of 2.76m.

Depths for both deposits are at 81-291m, with MetroCoal aiming to introduce longwall mining to the Surat Basin.

MetroCoal said the resource estimate was conservative as it was based “solely on the continuous, correlatable Macalister upper coal seam”

Future modelling is expected to further increase the resource by extending the resource area.

“This additional Norwood resource brings MetroCoal’s total thermal coal resource base in the Surat Basin to 620Mt,” MetroCoal chief executive Mike O’Brien said.

“We are particularly pleased to see this latest drilling confirm the continuous extension of the Macalister Seam over the EPCs with attractive mining thicknesses.”

O’Brien was general manager of the South Bulli longwall mine in 1991-92.

Shares in the company are up 1c to 31.5c this morning.