Altona Energy Regulatory News (ANR)

8 Sep 2005 12:46

Altona Resources PLC08 September 2005 Altona Resources Plc Signs Agreement to Acquire the Arckaringa Coal Project inSouth Australia Altona Resources Plc ("Altona"), (AIM:ANR) has reached an agreement ("theAgreement") to acquire a 100% interest in the Arckaringa Coal Project in SouthAustralia from Rank Geological Services Pty Ltd and Bentley Solutions Ltd ("theAcquisition"). The Arckaringa Coal Project comprises 100% interests in three explorationlicences in northern South Australia which have a combined total JORC compliantresource of over 7 billion tonnes of sub bituminous Permian coal amenable toopen pit mining, and suitable for fuel for power generation and potentialapplication of "coal to oil" technology. The three exploration licences, EL3360, EL3361, and EL3362 ("the Licences"),cover a combined area of approximately 2,500 square kilometres in the northernportion of the Permian Arckaringa Basin in South Australia and include threecoal deposits, known as the Westfield Deposit (EL3360), the Wintinna Deposit(EL3361), and the Murloocoppie Deposit (EL3362), which are located in closeproximity to the recently completed Adelaide to Darwin railroad, facilitatingthe potential for coal exports from Northern Australia. The Westfield Depositis adjacent to the railroad, and the Wintinna and Murloocoppie Deposits arelocated approximately 70 kms and 30 kms respectively from the railroad. In addition to the licences, the Acquisition includes data in respect of theLicences, with the areas covered by the Licences having had historicalexploration expenditure estimated to be in excess of AUD$10,000,000. Christopher Lambert, Chairman of Altona, commented: "The Acquisition willposition Altona as a holder of a substantial coal resource and energy bank, withthe potential to leverage the economic and marketing opportunities of the newAdelaide to Darwin railway, at a time of a favorable outlook for coal suitableas a fuel for power generation. We believe the Chinese authorities are taking measures to improve safetystandards in the coal industry. This may lead to either the modification orclosure of a substantial number of Chinese coal mines." Under the terms of the Agreement between Altona, Rank Geological Services PtyLtd ("Rank") and Bentley Solutions Ltd ("Bentley"): (1) Altona will acquire a 100% interest in ELs 3360, 3361 and 3362 and the associated data for a consideration of 30 million ordinary fully paid shares in Altona ("the Consideration Shares"); (2) Altona will engage Rank to provide geological services that meet the total statutory expenditure requirements for the Licences of approximately AUD$450,000 for the period ending on the first anniversary of the Licences. Rank is a New South Wales geological consulting firm, whose principals, Norman Kennedy and Rebecca Holland, have had extensive involvement with the Arckaringa Coal Project, including exploration, resource calculations and feasibility studies. (3) Rank will have the right to appoint a director to the Board of Altona at completion; (4) a full acquisition agreement is required to be completed within 30 days of the signing of the Agreement; (5) in the event that Altona undertakes a capital raising within 6 months of the completion of the Acquisition at a price ("Issue Price") which is at a discount to the five day weighted average closing price of Altona shares prior to the Agreement ("WAP"), the number of shares to be issued to Rank will be increased ("Additional Rank Shares") by the absolute percentage difference between the Issue Price and WAP, relative to the Issue Price. The Additional Rank Shares issued will be limited to the extent that the Consideration Shares and Additional Rank Shares combined together are to be less than 30% of the enlarged issued capital of Altona; and (6) completion of the Acquisition is subject to, amongst other things, due diligence and all necessary statutory approvals. Upon completion of the Acquisition, Rank and Bentley would have a combinedholding of 13.0% of the enlarged issued capital of Altona. Based on the current statutory expenditure commitments for the Licences,estimated costs of the Acquisition, other estimated operating expenditure, andthe current exploration and evaluation plans for the Arckaringa Coal Project,the directors of Altona believe the Company's current working capital will besufficient for the next 12 months. Altona's current intentions in respect of the Arckaringa Coal Project include: • review the potential for increasing the JORC compliant resource; • review the positive economic impacts of the recently completed Adelaide to Perth railroad, including coal exports out of Northern Australia; • review opportunities with the South Australian State Government for the supply of coal suitable as a fuel for power generation; and • review the potential application of coal to oil technologies. • the appointment of senior experienced coal executives and consultants to manage the commercial development of the Arckaringa Coal Project. -ends- For further information please contact: Altona Resources Plc Nabarro Wells & Co Limited Parkgreen CommunicationsChristopher Lambert, Hugh Oram Justine HowarthChairman Director+44 (0) 20 7016 9464 +44 (0) 20 7710 7400 +44 (0) 20 7493 3713 This information is provided by RNS The company news service from the London Stock Exchange