10 August 2017
Altona Energy Plc
(?Altona? or ?the Company?)
The Board of Altona (AIM: ANR) is pleased to provide the following strategy update to shareholders:
The Company, along with its joint venture partners Sino-Aus Energy Group Ltd (?Sino-Aus?) and Wintask Group Ltd (?Wintask?) (together the ?JV Partners?) have agreed a change in strategy for the exploitation of its coal asset at the Arckaringa site, where the Company continues to own three Exploration Licences (EL4511, EL4512 and EL4513). This decision has been made following the break-down in negotiations with the current owner of the Petroleum Exploration Licence Application 604.
The new strategy will see conventional coal mining techniques employed to extract the coal deposits which will then be processed to extract gas for electricity generation for the South Australian power grid as well as for the production of ethanol and methanol.
The Board of the JV Company will appoint WSP Parsons Brinckerhoff, Australia (?PB?) to produce a report addressing the following four areas:
Establish the existence across the three mining tenements of a ?dry? coal deposit(s) of sufficient quantity and quality to sustain a commercially viable and profitable coal mining project(s) dedicated to the production of electricity and/or methanol or ethanol.
If dry deposits are not economically viable, to investigate the probability of a low environmental impact ?wet? coal deposit(s) dedicated to the production of electricity and/or methanol or ethanol.
Provide an estimate of the size of power plant (MW capacity) that would be needed to make the project commercially viable and calculate the coal capacity required.
Should the ?wet? coal deposit be the most likely option, provide the best available conventional and non-conventional technologies to extract the coal in a manner that will limit or avoid impacting or intersecting the Great Artesian Basin.
The JV Partners have agreed to fund this report. Once PB has complied the report, the JV Partners, including Altona, will meet with PB to agree on further investigations e.g. drilling, aeromagnetic survey, seismic designed to define the target area including prospective mine parameters and scale. Further, the Company will provide PB with all the historic technical data it has collated over the years regarding the tenements and the viability of mining coal using traditional methods.
Mr Qinfu Zhang, Executive Chairman of Altona, commented, ?The Company will now investigate a coal to gas operation. It is a low risk option using well-proven methods of extraction and coal conversion. We have always had two choices to develop our extensive coal assets. To this end we have a vast amount of technical data regarding the coal and geology at Arckaringa which we will pass on to PB to expedite the delivery of their report.
?We are disappointed that we cannot progress our plans for using the UCG at this time but recognise it was a high-risk method of extraction with limited rates of success in Australia, to date. The Board considers that the return to traditional coal extraction and processing methods is in the best interests of shareholders in the current circumstances.
?In making this decision the board was cognisant of the acute energy deficit in South Australia and the opportunity this presents for energy producers.?
For further information, please visit www.altonaenergy.com or contact:
|Altona Energy plc
Qinfu Zhang, Executive Chairman
|+44 (0)7555 679 245|
|Leander (Financial PR)
Christian Taylor- Wilkinson
|+44 (0)7795 168 157|
|Northland Capital Partners Ltd (Nomad and Broker)
Matthew Johnson / Gerry Beaney (Corporate Finance)
John Howes (Corporate Broking)
|+44 (0)20 3861 6625|
Altona is listed on the London Stock Exchange?s AIM market. Its principal focus is on the evaluation and development of the Company?s flagship Arckaringa Project to exploit the significant coal resources contained in three exploration licences covering 2,500 sq. kms in the northern portion of the Permian Arckaringa Basin in South Australia. The Project is designed to produce syngas products for the Australian market and export from a resource exceeding 7.8 billion tonnes of coal (1.3 billion tonnes JORC compliant).
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