Hillsborough Resources Ltd. recently filed a pre-application with the British Columbia Environmental Assessment Office for an environmental review on its proposed Echo Hill surface coal mine, located about 44 highway kilometers north of Tumbler Ridge, British Columbia.
Hillsborough is a wholly-owned subsidiary of the Vitol group of companies, a private energy trading concern. A pre-application works something like the scoping process in the U.S., with assessment office to now put the project through a process where issues to be addressed in a future environmental assessment report will be identified. The office issued a notice about the pre-application on Nov. 5.
Exploration of the deposit dates from 1978 when the property was staked and drilled by Gulf Canada Resources, the October pre-application said. Gulf Canada subsequently let the claims lapse and the property was restaked by Hillsborough which carried out further exploration and drilling continuing up to the present time.
A project at this location was submitted into the provincial environmental assessment process by AES Wapiti Energy Corp., a joint venture between Hillsborough and U.S.-based AES Corp. (NYSE: AES), in 2006. At that time the project was presented as a 700,000 tonne per year surface coal mine with an on-site power plant. But the project was cancelled in 2007 following passage of legislation in British Columbia requiring net zero greenhouse gas emissions from power facilities.
The Echo Hill project will produce between 1 million and 1.5 million tonnes per annum via a combination of contour mining and highwall auger mining. The mine life would be 10 to 14 years. The opportunity to extend the mine life exists through exploration on coal licenses held adjacent to the project area, the pre-application report said.
Coal will be stockpiled, crushed and screened onsite to provide a thermal coal product for sale. Existing highway roads would provide access to a train loadout. The Peace River Coal Trend mine loadout and Teck Coal’s Bullmoose loadout are considered as possible loading points. These two loadouts are both located about 55 highway kilometers from the mine.
This coal aimed primarily at Asian thermal market
“The Project will involve the development and operation of a thermal coal mine,” said the report. “Demand for thermal coal is growing to support industrialization and power generation in countries such as China, Korea, Japan and India. Meanwhile new technologies are providing more cost-effective solutions for cleaner emissions from coal-fired power plants, which could expand markets for this coal. The expected market for the Project coal will be export markets in Asia, shipped through the Ridley Terminal in Prince Rupert, B.C.”
The Wapiti coal seam is classified as a sub-bituminous A to high volatile C bituminous coal. The coal sampling and quality analysis work done in conjunction with the exploration drilling indicates this coal to be suitable for thermal power generation. Coal sampling was also done for washability. “The results of these tests indicate that the coal has difficult washability characteristics and significant yield losses could be expected from a wet process coal preparation plant,” the report said. “For this reason the coal is being considered for use as a raw, run of mine product. Production of a raw, run of mine product eliminates the production of fine tailings and coarse rejects.”
A preliminary schedule for the project has the construction phase commencing in the second quarter of 2015. The operation and production phases are planned to start in the end of the second quarter of 2015 and continue for the 10 to 14 year mine life.
Hillsborough is a wholly-owned subsidiary of Vitol, a privately owned global energy trading company, said the report. “Hillsborough also owns and operates the Quinsam Coal Mine, an underground coal mine near Campbell River, British Columbia and owns Crossville Coal, a coal mine property in central Tennessee that is currently being reclaimed,” it added. “Echo Hill would be Hillsborough’s second wholly-owned coal mine in British Columbia.”