The results have confirmed the Rangal Coal measures are present and specifically, that the intercepts are consistent with the target seams of Leichhardt and Upper Vermont, Liberty Resources managing director Andrew Haythorpe said.

“The initial observations from the field are very encouraging. Vitreous black coal, at shallow depths, has been observed,” he said.

“This is an important indication of the potential value of the coal. The interpreted Leichhardt coal seam occurs at shallow depth beneath a basalt cap as logged by Tim Jones, the geologist who made the discovery.

“Also of note, the discovery hole sits within an open grassland area with no remnant vegetation.”

The preliminary scout drilling campaign has confirmed average coal intercepts of between 5m and 6m at 44m and 10m of Vermont plies between 58m and 70m, the upper being 4m at 58m.

The coal has been cored and is being submitted for assay to Bureau Veritas laboratory for coking and PCI attributes.

The Rangal Coal measures are being mined adjacent to the block at the BHP Billiton Daunia mine.

The Leichhardt and Vermont Upper seams are currently ranked as coking and PCI coals by BHP.

Drilling is continuing so as to expand on the results with the aim of producing a 2012 JORC-compliant measured resource statement.

“The shallowness of the coal is significant as it is likely to be easily reached via open pit methods with a low waste to ore ratio, and therefore likely to be economic to mine,” the company said.