Altona Energy Regulatory News (ANR)

21 Feb 2007 11:04

Altona Resources PLC21 February 2007 21st February 2007 Altona Resources Plc ("Altona" or "the Company") LOW CTL UNIT PRODUCTION COSTS PROJECTED Altona Resources plc (AIM: ANR) announces that analysis from initial financialmodelling of the Arckaringa Project - an integrated mine, Coal to Liquids ("CTL") and cogeneration power plant - shows current projected CTL net unitproduction costs in the lowest quartile of CTL industry benchmarks. The Company will present this analysis and other progress results from itsFeasibility Study of the Arckaringa Project to the AJM Coal to Liquids/Gas toLiquids Conference in Brisbane, Australia, on the 22nd February. A copy of thispresentation is available at the Company's internet site,www.altonaresources.com. The Company and its Project Financial Adviser, Royal Bank of Scotland, havedeveloped a preliminary financial model which has established a Base Caseproduction volume of 10 million barrels per annum ("MBPA") of liquid products(mainly ultra low sulphur diesel fuel). At these volumes, and on the basis ofliquids production alone, the Project is projected to have unit production(operating) costs of US$35 per barrel, which is competitive with CTL industryaverage operating cost benchmarks. An important aspect of the Project is the production of gas that will beavailable for power generation. Under the Project Base Case, 560 MW of powerwill be generated by the Project for sale into the increasingly supply deficientSouth Australian power market. Applying the sale of this power at current baseload prices against costs, the net unit operating costs are effectively reducedto a projected US$20 per barrel of liquid products. This would place the Projectat the very low end of CTL industry operating cost benchmarks. The financial model is based on the inputs from the following key reports: • The Jacobs Consultancy Feasibility Report on an ExpandableCTL plant, with a Base Case capacity of 30,000 barrels per day ("BPD") or 10MBPA of commercial petroleum products, including 80% ultra low sulphur dieseland 20% naptha, and expandable to 45,000 BPD. The plant design incorporatesConocoPhilips Gasification and Rentech's Fischer-Tropsch technology. • The parallel report by the Company's mine planningconsultants, MineConsult, which updated Base Case capital and operating costestimates for an open cut mine producing 10 Million tonnes per annum (Mtpa) fromAltona's multi-billion tonne Wintinna deposit to supply the CTL Plant. Altona's Chairman, Mr. Chris Lambert, commented: "The positive outcomes from thefinancial modelling encourage the Company to take the next steps in the ProjectFeasibility Study. These steps will include supplementary field drilling,quality testing of the coal for plant design, and further studies to optimizecapital and operating costs for both the CTL/Power Plant and Mine". This announcement contains forward-looking statements that are based onmanagement's expectations, estimates, projections and assumptions. Thesestatements are not guarantees of future performance and involve certain risksand uncertainties, which are difficult to predict. Therefore, actual futureresults and trends may differ materially from what is anticipated inforward-looking statements due to a variety of factors. All forward-lookingstatements speak only as of the date of this announcement or, in the case of anydocument incorporated by reference, the date of that document. -ends- For further information please contact: Altona Resources plc Christopher Lambert, Chairman +44 (0) 798 001 7108 Christopher Schrape, Managing Director +61 (0) 417 984 434 Nabarro Wells & Co Limited Hugh Oram, Director +44 (0) 207 710 7400 Parkgreen Communications Victoria Thomas +44 (0) 207 851 7480 Notes to Editors: The Arckaringa Project The Arckaringa Project ("Arckaringa") comprises: • the 100% interest in three exploration licences in South Australia,which have previously been calculated as a JORC compliant resource of over 7.5billion tonnes of sub bituminous Permian coal, amenable to open pit mining, andsuitable as fuel for power generation and potential application of coal to oiltechnology. The three exploration licences, EL3360, EL3361, and EL3362 ("theLicences"), cover a combined area of approximately 2,500 square kilometres inthe northern portion of the Permian Arckaringa Basin in South Australia. TheLicences include three coal deposits, known as the Westfield Deposit (EL3360),the Wintinna Deposit (EL3361), and the Murloocoppie Deposit (EL3362). • a proposed Coal to Liquids and cogeneration power plant, with BaseCase capacities of 30,000 BPD or 10 MBPA of petroleum products (zero sulphurdiesel fuel and naptha) and 562 MW of power, supported by a 10 Mtpa open cutmine based on the Wintinna deposit. The CTL/Power plant and mine would togetherrepresent an investment of approx US$3 Billion The coal deposits are located in close proximity to the Adelaide to Darwinrailroad, facilitating improved economic potential for despatch of CTL productsand coal to local and export markets. The railroad will also facilitate minedevelopment and operations. About Jacobs Consultancy Jacobs Consultancy is part of Jacobs Engineering Group Inc. ("Jacobs Group"),one of the world's largest and most diverse providers of professional technicalservices. With annual revenues exceeding $6 billion, Jacobs Group offersfull-spectrum support to industrial, commercial, and government clients acrossmultiple markets. Services include scientific and specialty consulting as wellas all aspects of engineering and construction, and operations & maintenance. Jacobs Group global network includes more than 60 major offices in over 15countries. They have operations in North America, the United Kingdom, Europe,India, Australia, and Asia. Their headquarters are in Pasadena, California. Further information is available at Jacobs Group's website at www.jacobs.com. About MineConsult MineConsult is an independent consulting group specialising in Technical,Operational and Management Services to the mining industry. The company iswholly Australian owned and has been operating for over 11 years. The group's professional staff primarily comprises mining engineers withAustralian and offshore experience in coal and metalliferous mining andundertake work for the private and public sectors. Further information is available at the MineConsult website atwww.mineconsult.com.au. This information is provided by RNS The company news service from the London Stock Exchange