Universal Coal (ASX: UNV) has moved to a direct 40% ownership of the Berenice Coking Coal Project and the Somerville project in South Africa, post the completion of the first phase of drilling and the updated resource estimate - which was completed by GEMECS.
The significance of the ownership for Universal Coal is that Berenice hosts a coking coal JORC Resource of over one billion tonnes, with 218 million tonnes Indicated and 840 million tonnes Inferred.
Universal Coal has entered agreements to earn-in to a 50% direct ownership at the project by producing a JORC Measured resource, with the company also holding an option to increase the stake to 74% by means of a third party valuation.
Tony Harwood, chairman, said "The results of the 1st phase drilling program have exceeded the previous resource estimates substantially and will allow the company to commence a second phase of drilling and a Scoping Study in the 4th quarter of 2011.”
Importantly for Berenice is the strategic location 30 kilometres from the main line railway siding linked to the Maputo and Richards Bay Ports.
At the project coal occurs within eight sub-zones in a 35 metre to 40 metre thick composite carbonaceous unit deposited within a structurally controlled half-graben, around 12.5 kilometres long and 4 kilometres wide.
Adding to the potential of the project are the coal-rich sub-zones which have been intersected from suboutcrop, less than 20 metres in depth and up to 250 metres below surface.
Originally published at: http://www.proactiveinvestors.com.au/companies/news/18198/universal-coal-secures-40-ownership-of-plus-billion-tonne-berenice-coking-coal-project-18198.html