Equus Mining has secured the rights to acquire 100% of Andean Coal Pty Ltd, a company that holds a strategic package of exploration licenses in Chile’s largest coal field, the Magallanes Basin.
Chile’s high growth in electricity demand and heavy dependency on fuel imports provides an excellent opportunity for new thermal coal project developments.
Equus Mining is to earn 51% in Andean Coal through the expenditure of A$ 0.2 million. Equus also has the option to purchase the remaining 49% of Andean for the consideration of A$ 0.2 million in shares.
Andean holds exploration licences covering an area of 170 km2 in three strategic project locations within the Magallanes Basin. The licences are centered over the main coal bearing unit, the Loreto Formation, which extends over a distance of 200 km.
The three project areas have strong potential to host shallow dipping coal deposits suitable for bulk open cut extraction, as indicated by a combination of wells as well as regional work doen by BHP and Chile’s state owned petroleum company ENAP.
Currently there are two operating open-cut coal mines within the Magallanes Basin, both using direct ship loading facilities. Andean’s largest ground holding, the Mina Rica project, is located adjacent to the Pecket coal mine and ship loader.
Chilean coal industry
Chile is an energy deficient country and imports approximately three-quarters of its energy needs. Thermal coal imports supply three-quarters of domestic consumption. Thermal coal consumption is forecast to grow from 12 million t in 2013 to approximately 30 million t over the next 10 years based on government power consumption growth figures and coal remaining at just 27% of the current power generation fuel mix.
Adapted from press release by Katie Woodward
Read the article online at: https://www.worldcoal.com/coal/27052014/equus_mining_targets_chilean_coal_890/