27 Sep 2013 07:00
27 September 2013
Beacon Hill Resources Plc / AIM: BHR / ASX: BHU / Sector: Mining
Beacon Hill Resources Plc ('Beacon Hill' or 'the Company')
Updated Reserve Statement
Beacon Hill, the AIM and ASX listed coal producer focussed on Mozambique, is pleased to announce the publication of the JORC Coal Reserve Statement for the Minas Moatize Coking Coal Mine in Tete, Mozambique ('Minas Moatize').
Overview:
· Significant economically viable mineable Reserve demonstrated at Minas Moatize despite current depressed coking and thermal coal prices - establishes project as economically robust during downturns in the resources cycle
· Total Run of Mine Proven and Probable Reserve (Air Dried Basis) of 39.38 million tonnes ('Mt')
· Total Proven and Probable saleable Reserve of 16.16Mt, of which at least 8.3Mt is coking coal
· Confirmation that Minas Moatize has a mine life of up to 15 years
Beacon Hill CEO, Rowan Karstel said, "This Reserve statement not only demonstrates that Minas Moatize remains robust during this period of depressed coal prices, but also acts as an important step in optimising the Company's reserve inventory to provide significant upside as coal prices recover. In January 2013 the Minas Moatize Resource statement was increased by over 30% to 86.8 Mt and by following the same methodology, through additional exploration work and value engineering, we expect to make further improvements to our Reserve base. We are also active in reviewing opportunities in adjacent properties for expansion of our life of mine, scale and efficiency, with the aim of generating significant additional value upside.
"This Reserve statement has been developed concurrently with our development objectives at Minas Moatize, as we continue to ramp up coking coal production following the completion of the first phase of our wash plant upgrade. This development work is anticipated to further demonstrate Minas Moatize as a low cost producer with access to an economically efficient logistics solution, being the SENA rail access to the Port of Beira, Mozambique. Together with this Reserve statement, I believe Beacon Hill continues to demonstrate its advancement towards developing a tier 1 asset at Minas Moatize."
Reserve Statement
Minas Moatize Run of Mine Coal Reserve Statement | |||||||||
Proven: Run of Mine Reserves | |||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Relative Density | Total Sulphur | Volatile Matter |
(%) | (Mj/kg) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Chipanga Upper Coal Seam Proven Reserve | 549,708 | 937,808 | 45.97 | 17.72 | 38.72 | 0.93 | 1.71 | 1.32 | 14.38 |
Chipanga Middle Coal Seam Proven Reserve | 1,096,402 | 2,033,092 | 56.11 | 12.82 | 30.27 | 0.92 | 1.85 | 0.74 | 12.69 |
Chipanga Lower Coal Seam Proven Reserve | 18,282,960 | 31,034,528 | 42.28 | 18.70 | 43.04 | 0.91 | 1.70 | 1.09 | 13.77 |
Total Run of Mine Proven Reserve | 19,929,070 | 34,005,428 | 43.21 | 18.32 | 42.15 | 0.91 | 1.71 | 1.08 | 13.73 |
Probable: Run of Mine Reserves | |||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Relative Density | Total Sulphur | Volatile Matter |
(%) | (Mj/kg) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Chipanga Upper Coal Seam Probable Reserve | 24,173 | 42,788 | 51.52 | 15.78 | 34.54 | 1.00 | 1.77 | 1.37 | 12.94 |
Chipanga Middle Coal Seam Probable Reserve | 158,647 | 301,120 | 58.98 | 12.02 | 28.13 | 1.08 | 1.90 | 0.73 | 11.81 |
Chipanga Lower Coal Seam Probable Reserve | 2,982,919 | 5,038,306 | 41.77 | 19.01 | 43.82 | 0.89 | 1.69 | 0.98 | 13.51 |
Total Run of Mine Probable Reserve | 3,165,739 | 5,382,213 | 42.81 | 18.59 | 42.87 | 0.90 | 1.70 | 0.97 | 13.41 |
Proven and Probable: Run of Mine Reserves | |||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Relative Density | Total Sulphur | Volatile Matter |
(%) | (Mj/kg) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Chipanga Upper Coal Seam Proven Reserve | 573,881 | 980,596 | 46.22 | 17.64 | 38.54 | 0.93 | 1.71 | 1.32 | 14.32 |
Chipanga Middle Coal Seam Proven Reserve | 1,255,049 | 2,334,212 | 56.48 | 12.71 | 30.00 | 0.94 | 1.86 | 0.74 | 12.58 |
Chipanga Lower Coal Seam Proven Reserve | 21,265,879 | 36,072,834 | 42.21 | 18.74 | 43.15 | 0.90 | 1.70 | 1.08 | 13.74 |
Total Run of Mine Reserve | 23,094,809 | 39,387,641 | 43.16 | 18.35 | 42.25 | 0.91 | 1.71 | 1.06 | 13.68 |
Table 1-1: Run of Mine Reserve, tonnes and qualities reported on an Air Dried Contaminated Basis (ADC Basis)
Minas Moatize Saleable Coal Reserve Statement | |||||||||||
Proven: Saleable Reserves | |||||||||||
10.5% Ash Coking Coal Saleable Reserves | |||||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Total Sulphur | Volatile Matter | Wash Cut Density | Geological Yield | Plant Yield |
(%) | (Mj/kg) | (%) | (%) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Total Coking Coal Proven Reserve | 4,186,427 | 7,087,255 | 10.51 | 31.42 | 70.52 | 0.84 | 0.91 | 16.54 | 1.44 | 23.20 | 21.88 |
25.1Mj/kg Thermal Coal Saleable Reserves | |||||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Total Sulphur | Volatile Matter | Wash Cut Density | Geological Yield | Plant Yield |
(%) | (Mj/kg) | (%) | (%) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Total Thermal Coal Proven Reserve | 4,027,946 | 6,810,703 | 27.60 | 25.11 | 57.07 | 0.81 | 0.85 | 14.52 | 1.63 | 29.91 | 28.41 |
Total Saleable Proven Reserve | 8,214,373 | 13,897,959 | 18.88 | 28.33 | 63.93 | 0.83 | 0.88 | 15.55 | 1.53 | 26.49 | 25.08 |
Probable: Saleable Reserves | |||||||||||
10.5% Ash Coking Coal Saleable Reserves | |||||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Total Sulphur | Volatile Matter | Wash Cut Density | Geological Yield | Plant Yield |
(%) | (Mj/kg) | (%) | (%) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Total Coking Coal Probable Reserve | 724,077 | 1,219,152 | 10.56 | 31.54 | 71.41 | 0.85 | 0.92 | 15.95 | 1.45 | 25.03 | 23.59 |
25.1Mj/kg Thermal Coal Saleable Reserves | |||||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Total Sulphur | Volatile Matter | Wash Cut Density | Geological Yield | Plant Yield |
(%) | (Mj/kg) | (%) | (%) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Total Thermal Coal Probable Reserve | 624,900 | 1,050,582 | 27.72 | 25.12 | 57.29 | 0.78 | 0.81 | 14.19 | 1.63 | 29.12 | 27.66 |
Total Saleable Probable Reserve | 1,348,977 | 2,269,734 | 18.50 | 28.57 | 64.88 | 0.82 | 0.87 | 15.14 | 1.54 | 26.92 | 25.47 |
Proven and Probable: Saleable Reserves | |||||||||||
10.5% Ash Coking Coal Saleable Reserves | |||||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Total Sulphur | Volatile Matter | Wash Cut Density | Geological Yield | Plant Yield |
(%) | (Mj/kg) | (%) | (%) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Total Coking Coal Saleable Reserve | 4,910,504 | 8,306,407 | 10.52 | 31.44 | 70.65 | 0.84 | 0.91 | 16.46 | 1.45 | 23.47 | 22.13 |
25.1Mj/kg Thermal Coal Saleable Reserves | |||||||||||
Description | Volume | Tonnes | Ash | Heat Value | Fixed Carbon | Inherent Moisture | Total Sulphur | Volatile Matter | Wash Cut Density | Geological Yield | Plant Yield |
(%) | (Mj/kg) | (%) | (%) | (%) | (%) | (t/m3) | (%) | (%) | |||
AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | AD Basis | ||
Total Thermal Coal Saleable Reserve | 4,652,846 | 7,861,285 | 27.61 | 25.11 | 57.10 | 0.81 | 0.84 | 14.48 | 1.63 | 29.80 | 28.31 |
Total Saleable Reserve | 9,563,351 | 16,167,693 | 18.83 | 28.36 | 64.06 | 0.83 | 0.88 | 15.49 | 1.53 | 26.55 | 25.13 |
Table 1-2: Saleable Reserve, tonnes and qualities on an Air Dried Basis (AD Basis)
EMPR Consultancy cc alternatively EMPR Mining and Consulting has been commissioned by Beacon Hill to compile an Independent Opencast Coal Reserve Statement on Minas Moatize Limitada ('MML'), a Coking Coal resource, located in Tete province of Mozambique within the tenement boundary of 1163C.
Beacon Hill acquired Minas Moatize in 2010 from Borneo Mining / AMCI where the mining licence was granted on 15 July 2005, having a size of 266 hectares and which is valid for 10 years.
The site had been operating an underground mine which closed in 2011 and transitioned to open pit operations. The open cut mining operation was done in two phases:
· Phase 1 - ROM Treatment Rate of 600 000 tons per annum, Q2 2012
· Phase 2A - The CHPP capacity is 1.8Mtpa, with an hourly capacity of 270 t/h was commissioned during H1 2013
· Phase 2B & C - The CHPP capacity will be increased to 2.8Mtpa and will be operational end of June 2014. Phase C will include a Flotation unit and is expected to increase the overall yield by 7%.
Minas Moatize entered into a new Mining Contract with the Government of Mozambique on 28 March 2013 for a period of 25 years.
JORC Compliance
This Coal Reserve Statement has been prepared in accordance with the following:
This CPR has been prepared in accordance with the JORC Code, 2012 Edition, prepared by the Joint
Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and the Minerals Council of Australia and herein referred to as "JORC" or "JORC Code". Where reference is made to the term "JORC" it shall also mean and include:-
· The 2009 South African Code for Reporting of Mineral Resources and Mineral Reserves known as the SAMREC Code ("SAMREC") Code;
· The 2009 Mineral Asset Valuation Committee ("SAMVAL") Code published under the Joint Auspices of the Southern African Institute of Mining and Metallurgy and the Geological Society of South Africa;
This Opencast Coal Reserve Statement has been prepared under the direction of the Competent Persons (the "CPs") and/or the Competent Valuator ("CV") who assume overall professional responsibility for the document. The Opencast Reserve Statement however is published by EMPR, the commissioned entity, and accordingly EMPR assumes responsibility for the views expressed herein. Consequently with respect to all references to the CP and/or CV and EMPR: all references to EMPR mean the CP and/or CV and vice-versa
This Reserve Statement has been prepared in order to satisfy the disclosure requirements of the ESMA update of the CESR recommendations for the consistent implementation of Commission Regulation (EC) No 809/2004 implementing the Prospectus Directive issued by the European Securities and Markets Authority on 23 March 2011, specifically clauses 131 to133.
**ENDS**
For further information, please contact: | |
Beacon Hill Resources Plc | |
Justin Farr-Jones, Chairman (jfarr-jones@bhrplc.com) Rowan Karstel, Chief Executive Officer (rowan.karstel@bhrplc.com) |
|
Canaccord Genuity Limited (Nominated Adviser) Andrew Chubb / Neil Elliot / Joe Weaving |
+44 (0) 20 7523 8000 |
St Brides Media & Finance Limited (Financial Public Relations) Susie Geliher / Elisabeth Cowell |
+44 (0) 20 7236 1177 |
Competent person's statement
EMPR is associated with many accredited consulting companies, providing a service where the most experience and qualified person undertakes any part, or specific part of any study undertaken by EMPR.
EMPR's independence is ensured by the fact that it holds no equity in any project. This permits the EMPR to provide its clients with conflict-free and objective recommendations on crucial judgment issues. EMPR has a demonstrated track record in undertaking independent assessments of resources and reserves, project evaluations and audits, Competent Persons' Reports, Mineral Experts' Reports, and independent feasibility evaluations to bankable standards on behalf of exploration and mining companies and financial institutions worldwide. EMPR has also worked with a large number of major international mining companies and on their projects, providing mining industry consultancy services. EMPR also has specific experience in commissions of this nature.
The overall responsibility for the Opencast Reserve Statement is Mr CW Archer who is the owner of EMPR Consultancy cc, EMPR Mining and Consulting (Pty) and EMPR Mining and Consulting Group. Mr Archer is a mining engineer with 28 years' experience in the mining industry and has supervised many due-diligence reviews and engineering studies in Southern Africa and internationally during the past 19 years since starting EMPR.
The CP with responsibility for the reporting of Coal Reserves is Mr Mark Mohring, Pr.Certified Engineer (Engineering Council of South Africa), Member of the Southern African Institute of Mining and Metallurgy, who is a Principal Consulting Mining Engineer with EMPR. Mr Mohring has 27 years' experience in the mining industry, in operations, academia and consulting. He is actively involved in the field of productivity optimisation, mine planning and underground and surface mine design, and is involved in Feasibility Studies, Due Diligence reviews, Independent Engineer's Reports and Competent Persons' Reports. He has been responsible for the reporting of Coal Reserves on various properties in Southern Africa and abroad during the past five years.
Sources of Information and Salient Assumptions for JORC Compliant Reserve Statement:
| ||
· Beacon Hill Resources: September 2013 Coal Mining and Environmental Information | ||
· Beacon Hill Resources: August 2013 Coal Market Demand and Coal Price Information | ||
· Beacon Hill Resources: June 2013 Coal Processing and Logistic Cost Information | ||
· Maptek: June 2013 Geological Model with Measured and Indicated Coal Resource Areas defined by polygon | ||
· EMPR: Modifying Factors | ||
· Measured and Indicated geological confidence discount factors supplied by Mr PC Meyer (July 2013) | ||
· Coal Roof and Floor Losses based upon structural geological factors and seam dip | ||
· Decommissioned Underground Workings extraction based on survey/drawing data supplied by Mr PC Meyer · (July 2013) | ||
· Mining Contamination based upon structural geological factors and seam dip | ||
· Underground extraction based upon actual pillar design criteria achieved historically | ||
· Pit Shell Design in accordance with Geotechnical Report undertaken by TWP (Report ID: CES110511-EMA-AD) | ||
· Profit Ranking Exercise defines maximum outer pit perimeter, superimposed at surface elevation | ||
· 25m Tenement 1163C Boundary offset (haul roads, pollution control berms, safety berms and barriers | ||
· Pit Perimeter lies within profitable opencast mining extents - Reserves profitable and marketable | ||
· Practical/Plant Yields and mine discount factors rounded to 7 decimal places | ||
o Coal Structure rounded to 7 decimal places | ||
o Coal Qualities rounded to 4 decimal places | ||
o Coal Structure - Partial Percentages used on model sub blocks | ||
o Coal Structure: 5m x 5m x 2.5m User Block Size | ||
o Coal Structure Sub Blocking: 5m x 5m x 0.078m | ||
GLOSSARY
AD | tonnage and quality reported and estimated are measured on an Air Dried Basis | ||
AR | tonnage and quality reported and estimated are measured on an As Received Basis and therefore includes extraneous mining and plant | ||
CHPP / Washplant | Coal Handling and Preparation Plant ('CHHP') or Washplant is used to wash / process coal into a higher value product that is saleable into global export markets | ||
Coking Coal | Also known as Metallurgical Coal is a high quality coal used in the steel production industry | ||
| CP | Competent Persons as defined under SAMREC | |
| Flotation | A method to separate coal in the coal processing process | |
| GTIS | Gross Tonnes In-Situ measured on an Air Dried Basis | |
| t/h | Tonnes per hour | |
| t/m3 | Tonnes per cubic metre | |
| Mj/kg | Mega-joules per kilogramme | |
| Mt | Million tonnes | |
| Mtpa | Million tonnes per annum | |
| ROM | Run of mine coal as received from the mine | |
| SAMREC | South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves | |
| SAMVAL | South African Code for the reporting of mineral asset valuation | |
| JORC | Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy | |
| Thermal Coal | Steaming coal intended for use in the steam and power generation industry | |