Debiensko Coal Project
The Debiensko Hard Coking Coal Project (“Debiensko” or “Project”) is a fully permitted, hard coking coal project located in the Upper Silesian Coal Basin in the south west of the Republic of Poland.
The Debiensko mine was originally opened in 1898 and was operated by various Polish mining companies until 2000 when mining operations were suspended due to a major government led restructuring of the coal sector caused by a downturn in global coal prices. In early 2006 New World Resources Plc (“NWR”) acquired Debiensko and commenced planning in order for the Project to comply with Polish mining standards and with the aim of accessing and mining hard coking coal seams.In 2007, the Minister of Environment of Poland approved the Group’s development plan and in 2008 granted NWR a 50-year mine license for Debiensko.
In October 2016, Prairie Mining Limited acquired all of the issued shares of NWR Karbonia S.A. owner of the Debiensko Project, from NWR.
Infrastructure
With existing site facilities and infrastructure including power, water, rail and road in addition to the mining concession, environmental consent and local planning all being in place, the Project is considered “development-ready”. Debiensko’s strategically competitive location means that approximately half of Central Europe’s coking plants and steelmaking capacity are within 250km of the Project and are connected by existing road and rail infrastructure.
In October 2016, Prairie Mining Limited acquired all of the issued shares of NWR Karbonia S.A. owner of the Debiensko Project, from NWR.
Infrastructure
With existing site facilities and infrastructure including power, water, rail and road in addition to the mining concession, environmental consent and local planning all being in place, the Project is considered “development-ready”. Debiensko’s strategically competitive location means that approximately half of Central Europe’s coking plants and steelmaking capacity are within 250km of the Project and are connected by existing road and rail infrastructure.
Revised Development Approach
Following detailed technical due diligence by Prairie, the Company is confident that a revised development approach would allow for the early mining of profitable coal seams, whilst minimising upfront capital costs. This is likely to include focusing on a smaller area of Debiensko to target coal seams that are more readily accessible. Prairie has proven expertise in defining commercially robust projects and applying international standards in Poland.
Following detailed technical due diligence by Prairie, the Company is confident that a revised development approach would allow for the early mining of profitable coal seams, whilst minimising upfront capital costs. This is likely to include focusing on a smaller area of Debiensko to target coal seams that are more readily accessible. Prairie has proven expertise in defining commercially robust projects and applying international standards in Poland.
Exploration Target Range*
Extensive drilling was carried out historically at Debiensko and historical resources published to Polish reporting standards (non-JORC). Prairie’s Exploration Target has been estimated for the following seams 401/1, 401/2, 402/1, 403/1, 403/2, 404/3, 404/5, 404/9, 405, 406/1, 407/2, 407/3, 408/1, 408/3, 408/5 and 409/1. Prairie has reported an Exploration Target for this target area in accordance with the JORC Code (2012).
To allow for possible geological and modelling uncertainty a deduction of 20% has been applied to give the range of tonnages reported below. The tonnages in the table aboveare for the seams that have been assessed and for which there has been insufficient exploration to be considered as resources at this time. The figures therefore represent the potential which is dependent on further exploration and reviews of the area.
Potential Coal Quality
Historical coal quality analysis completed at the Project, and based on Polish reporting standards, has demonstrated coal qualities indicative of internationally traded benchmark premium hard coking coals. The table below gives the potential range of weighted average seam qualities. These are on an air dried basis. It was standard practice, at the time of sampling, to include dirt partings up to 5 cm in thickness in the coal sample, however, if the percentage ash was greater than 12% the sample was washed before further analysis. Partings greater than 5 cm in thickness were not analysed.
The above potential ranges of weighted average seam qualities are comparable to qualities of internationally traded benchmark Medium Volatile Matter and Low Volatile Matter coals. This is illustrated in the table below.
Next Steps and Work Program
Prairie is currently undertaking a detailed review of historic exploration, geophysical survey, drilling, coal quality, and development data acquired through this transaction including 3D geological modelling to establish a maiden hard coking coal resource in accordance with the JORC Code (2012). Once established, the Company will undertake a focused infill core drilling program to support JORC-compliant resource estimates which will form the basis for upcoming feasibility studies.
With Debiensko, Prairie has successfully acquired a full project team of Polish mining specialists who are part of the existing Debiensko team. Since, under Polish Law, Debiensko is a fully permitted mine site, Prairie now retains the employment of a mine manager and chief engineer amongst other crucial positions who will integrate with Prairie’s world class team to re-engineer the Project.
*The potential quantity and grade of the exploration targets are conceptual in nature and there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.
