Friday, October 31, 2008

Aquila Resources

COAL

Isaac Plains Coal Mine

· Sales for Quarter 463kt, best Quarter to date.

· CHPP performance continues to improve.

· Commissioning of on-site coal quality laboratory.

 

Eagle Downs Coal Project

· Pre-Feasibility Study results demonstrates technical and financial viability.

· Preferred development to include two longwalls producing up to 7Mtpa of hard coking coal.

· Stage 4 coal quality and resource definition drilling programme in progress.

· Budget of A$28.6 million proposed for the 2008-2009 financial year to complete the Definitive Feasibility Study and exploration.

 

Belvedere Coal Project

· Pre-Feasibility Study in progress.

· Four drilling rigs operating.

· Completion of 3-D seismic programme.

· Three Mining Lease Applications lodged.

· Contractual arrangements concluded for potential port capacity at Wiggins Island, Gladstone.

 

Washpool Coal Project

· Initial Resource Statement for 138Mt insitu coal.

· Concept Study on mining and processing options well advanced.

· Contractual arrangements concluded for potential port capacity at Wiggins Island, Gladstone.

 

Red Hill Coal Project

· Initial Resource Statement 75Mt insitu coal.

· Concept Study on mining and processing options well advanced.

· Metallurgical coal potential similar to that being mined at Isaac Plains Coal Mine.

· 2Mtpa port capacity secured at Abbot Point.

 

Asenjo Energy Coal Project

· Substantial drilling programme continues on the key project areas.

· Significant open cut potential being evaluated at East Mmamabula project which could facilitate early development.

· Tender notice for baseline environmental studies issued.

 

Waterberg Coal Project

· Prospecting rights offered for grant in the Waterberg Coalfield, targeting open pit extractable coal tonnages.

 

IRON ORE

West Pilbara Iron Ore Project – Development

· A Budget of A$84.4M has been approved for the 2008-2009 financial year to fund the Definitive Feasibility Study and exploration.

· Bulk sampling has commenced on the Upper Cane deposit using a continuous miner.

· Favourable sinter test results were received from the laboratory at CISRI in China.

· Referral documents describing the West Pilbara Iron Ore Project were submitted to the EPA during the Quarter.

· Geotechnical testing was conducted on the locations of marine structures for each of the port sites under consideration.

· A review of port options, with the intent of settling on a preferred site, is due for completion early in the next Quarter.

· Marketing visits to Chinese steel mills this Quarter have delivered encouraging responses.

· An MoU has been signed with a Chinese steel mill to test API ore in their laboratory.

 

West Pilbara Iron Ore Project – Exploration

· Mapping has outlined newly identified Channel Iron Deposit (CID) mineralisation extending over 6km within the Mt Elvire Project.

· RC and diamond drilling of CIDs within the Red Hill and Yalleen Joint Venture tenements have continued. A total of 9,905m of RC drilling and 826m of diamond drilling were completed in the Quarter.

· Infill drilling at Trinity Bore South continues to identify extensive 5m – 10m intercepts of shallow pisolitic CID. Better results returned from the infill programme include;

§ 10m at 54.10% Fe, 3.46% Al2O3, 8.36% SiO2, 0.030% P, 0.030% S and 10.14% LOI from surface in TBRC223;

§ 12m at 55.08% Fe, 4.08% Al2O3, 6.18% SiO2, 0.040% P, 0.020% S

§ 10.39% LOI from surface TBRC234, and

§ 10m at 54.54% Fe, 3.28% Al2O3, 7.51% SiO2, 0.030% P, 0.020% S and 10.28% LOI from surface in TBRC232.

· Diamond drilling continues to return significant intercepts of CID mineralisation at Kumina Creek. Better results returned include;

§ 14m at 58.40% Fe, 4.21% Al2O3, 4.45% SiO2, 0.049% P, 0.016% S and 7.14% LOI from 25.4m,

§ 21.10m at 60.88% Fe, 3.06% Al2O3, 3.19% SiO2, 0.048% P, 0.015% S and 6.13% LOI from 42.15m in YA223, and

§ 13.10m at 56.74% Fe, 3.88% Al2O3, 4.54% SiO2, 0.046% P, 0.019% S and 9.94% LOI from 13.3m in YA260.

 

Thabazimbi Iron Ore Project

· Drilling to evaluate iron ore occurrences continued at Thabazimbi.

· Best drill result was at Cornwall with 16.8m at 59.2% Fe, 0.32% Al2O3, 13.35% SiO2, 0.03% P, 0.04% S and 0.82% LOI from 19.5m in CL20D.

· Field assessment of iron ore targets underway at Orange River in the Northern Cape Province.

 

MANGANESE

Avontuur Manganese Project

· Drilling at Avontuur intensified to accelerate the delineation of manganese mineralisation in the Northern Cape Province.

· 5,611m of drilling were undertaken during the Quarter, with assays still outstanding.

 

CORPORATE

· Cash and liquid investments total A$196.6 million at the end of the Quarter.

· The Company decided not to proceed with demerger of the early stage exploration assets because of the global financial turmoil.

 



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