Colonial Coal scores a substantial jump in British Columbia coal holdings

Colonial Coal International Corp. (TSX VENTURE: CAD) said July 18 that it has received the results of an independent resource estimate for its 100% owned Huguenot coking coal project located in northeast British Columbia.

These estimates have been determined using a 0.60 meter true thickness cut-off. Measured plus Indicated resources of 92.2 million tonnes represent an increase of 104% over previously reported resources (45.2 million tonnes) in these categories as set forth in a National Instrument 43-101 technical report from August 2010. Additional Inferred resources total 38.2 million tonnes, representing an increase of 271% over the previous reported Inferred resource estimate of 10.3 million tonnes. The current resource estimate cover the entire main target of the Huguenot deposit (North, Middle, and South Blocks) while the previous tonnage was for the North Block only.

The current resource estimates have been done by consultant Norwest Corp. in conjunction with the preparation of a NI 43-101 technical report for the property’s main coking coal targets contained within the Gates Formation coal measures. The technical report will be completed within 45 days. Norwest has also identified potential underground mineable coal tonnes in the range of 60 million to 80 million tonnes and is currently investigating the possibility that some of these tonnes may be suitable for classification in accordance with NI 43-101 guidelines.

David Austin, President and CEO of Colonial, said: “This a major step forward for the company and its shareholders. The results are in line with our expectations and significantly increase the asset value of the property. We have commenced this year’s exploration program and environmental baseline studies and data collections are ongoing. I would like to thank our technical staff and independent consultants for another job well done.”

Colonial Coal is among a number of companies – including Xstrata plc, Walter Energy‘s Western Coal unit and Teck Resources – looking to develop or redevelop coal mines in British Columbia to take advantage of expected explosive growth in the demand for coking coal around the Pacific Rim. Countries like China and India have rapidly-expanding steel production operations, which need coking coal as a key part of the process of turning iron ore into steel.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.