core sector communique

Hunnu Coal [ASX: HUN] - Acquisition of 60% of Unst Khudag Coal Mine in Mongolia

Hunnu Coal (ASX: HUN) is acquiring a 60% interest in the Unst Khudag Coal Mine and surrounding licenses, which are located in the Dundgobi Province of Mongolia.

Highlights:

* The Unst Khudag Coal Mine is strategically located 200km from an operational multi party coal loading facility on a major rail line.
* Consists of two Exploration Licenses and one Mining License covering over 59,000 hectares.
* Approved Mining Plan and Feasibility Study for the mining of 98.7Mt of coal.
* Hunnu is targeting first production from the Unst Khudag Coal Mine in the latter half of 2010.
* Off-take agreements are currently being discussed with Mongolian and Chinese coal users.
* Exploration Target of 250Mt to 500Mt.*
* Past trial production of approximately 30,000t for bulk test work with potential off-take partners and local utilities.
* Single coal seam with average thickness of 20 metres dipping at 0 to 5 degrees.
* Coal at less than 4 metres from the surface.
* Low strip ratio at less than 1:1 from startup.
* Coal analysis reveals high quality thermal coal with quality parameters on average Qdaf = 6460 kCal/kg, Ash = 13.9% and Moisture content = 23.9%.