2 February 2018
Altona Energy Plc
(?Altona? or ?the Company?)
MoU with Joint Venture Partners
Altona (AIM: ANR), a coal exploration company focused on South Australia, is pleased to report that a non-binding Memorandum of Understanding (?MoU?) between the Company and its Joint Venture Partners, Wintask Group Limited (?Wintask?) and Sino-Aus Energy Group Limited (?Sino-Aus?) has been signed.
Under the terms of the MoU, Wintask, Sino-Aus and Altona, have confirmed their intention to co-operate to assess the potential for a conventional coal mine in the Westfield tenement. In addition, both Wintask and Sino-Aus have confirmed to the Company that the level of funding committed in the 2014 Joint Venture Agreement can be made available to develop the project (AUD$3.3 million and AUD$29.7 million, respectively). It is expected that these amounts would be sufficient to complete all exploration and also the bankable feasibility study.
Initial investigations by consulting engineers indicate that there is a coal seam in the south west of the Westfield tenement that may be sufficiently shallow, dry and disconnected from the Great Artesian Basin to be economically extractable. There has been much exploration throughout the Arckaringa Basin generally, but the area that the Company is now focused on has never been explored. Previous exploration activities by various companies have focused on the significant coal deposits elsewhere in the Arckaringa Basin that were too deep and too connected to the Great Artesian Basin to be economically extractable.
Altona?s Joint Venture Partners are particularly encouraged by the current macro-economic conditions for coal demand, particularly in relation to China. Currently, the price of thermal coal ex-Newcastle, the main exporting port in Australia is FoB (?free on board?) AUD$128 per tonne.
Although the Company cannot estimate the FoB cost for Westfield until after further exploration, large scale coal miners elsewhere in Australia typically are quoting FoB costs of less than AUD$60 per tonne.
This support from Sino-Aus and Wintask encourages the Company to immediately commence its engagement of a reputable geological consultant firm to deliver an initial exploration plan for Westfield.
Nick Lyth, CEO of Altona, commented, ?I am delighted that our partners have expressed a willingness to develop the Company?s coal project. This level of funding would represent more than twice the Company?s current market capitalisation. The economics of conventional coal mining in Australia are at their strongest level for several years with a number of thermal coal mine companies, such as Whitehaven Coal, showing significantly higher share prices and exceptional profits.
?I look forward to reporting progress on our exploration to shareholders, along with further updates on our tenement licence renewals and third-party agreements.?
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.
For further information, please visit www.altonaenergy.com or contact:
|Altona Energy plc
Nicholas Lyth, Chief Executive Officer
+44 7769 906 686
|Leander (Financial PR)
Christian Taylor- Wilkinson
+44 7795 168 157
|Northland Capital Partners Ltd (Nomad and Broker)
Matthew Johnson / Gerry Beaney (Corporate Finance)
John Howes (Corporate Broking)
+44 20 3861 6625
About Altona Energy
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 seams contained in three exploration licences covering 2,500 sq. kms in the northern portion of the Permian Arckaringa Basin in South Australia. The Project has an historic resource exceeding 7.8 billion tonnes of coal (1.3 billion tonnes historic under JORC 2004).
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