Australia’s Attila Resources Ltd. said Oct. 8 that first analysis results of samples from the Coke coal seam, resulting from recent exploration work, shows strong coking coal qualities at the currently shut Kodiak deep mine in Alabama.
First analysis from Coke seam shows: extremely low ash (2.6%) and sulfur (0.5%) on a washed basis; and superior fluidity of +20,000 ddpm and swell (FSI 9) indicating a premium hard coking coal. The as received analysis of this coal highlights the potential for raw coal sales of high quality coking coal, the company added. Exploration drilling is continuing with five drill rigs on site to establish a maiden Joint Ore Reserves Committee (JORC)-compliant resource from an exploration target of 80 million-100 million metric tons (tonnes) of hard coking coal.
Attila Resources (ASX: AYA, AYAO) owns 70% of the Kodiak project, located in Shelby County, Ala. Kodiak is a shut coking coal mine that has been on care and maintenance since the end of 2008. The operation is fully permitted on private land owned by Attila and over 118 coalbed methane wells have been historically drilled over the project area and the area around it.
Attila said in an Oct. 2 announcement that exploration has shown the Coke and Atkins coal sequences have been intersected in all drill holes with coal units being up to six feet in thickness with coal seams up to five feet in thickness. The coal units intersected to date are in line with the historically drilled coalbed methane wells in the project area.
The company said in an August investor presentation that the Kodiak site has existing infrastructure, including wash plant, rail loadout, power and water. It wants to begin mining coal in late 2013.
The presentation said the company’s project management includes Don Brown, the president in the 1990s of Cyprus Amax Coal, at the time a major U.S. coal producer with mines in various basins. The company also counts as part of its management team Alan Stagg, a veteran coal mining consultant with Stagg Resource Consultants.
The company said it has completed an initial logistics review which has identified numerous options as possible routes to get the Kodiak coal onto the export market. As a result, discussions have commenced on rail moves, and barging options are being explored on the Black Warrior and Tombigbee river systems that run from Birmingham to the Port of Mobile (about 350 kilometers away). The Port of New Orleans has been identified as another possible export port. Attila said it has engaged the services of a local consultant introduced to the company by its joint venture partner, TBL Metallurgical Resources LLC, which is a Brown company, to assist in securing access and port capacity for its coal export strategy.
Kodiak is a mine once owned by Walter Energy (NYSE: WLT), a major coal producer in Alabama. The mine is technically called Coke No. 1. The “temporarily idled” prep plant is currently listed with the U.S. Mine Safety and Health Administration as the Kodiak #1 plant of Kodiak Mining Co. LLC. The Coke No. 1 mine is listed with MSHA as “abandoned,” with last production in 2008 (69,487 tons produced that year), with 95,336 tons produced in 2007.