Coal projects come off back burner

Vancouver-based Western Canadian Coal (WTN-V) has offered to explore and evaluate Talisman Energy’s () Sukunka coal licences in northwestern British Columbia.

The Sukunka property is 30 km northwest of Tumbler Ridge and between Western’s existing coal projects in the region. About 250 million tonnes of coal are known to exist on Western’s properties, the most advanced being Wolverine Perry Creek, slated for startup in mid-2006.

Western Canadian Coal will carry out geological and engineering work to identify potential mine areas at Talisman’s Sukunka licences, and then make a development proposal. Assuming Talisman accepts the proposal, Western would then carry out more exploration and development studies aimed at opening an underground mine within two years.

Extensive work was carried out at the Sukunka coal licences during the late 1970s and early ’80s. A resource of 120 million tonnes was outlined, and bulk samples of about 200,000 tonnes were shipped to Asian mills for testing.

Western notes that at the time, the proposed product was considered “an excellent metallurgical coking coal featuring low ash content and excellent coking indices.”

Western has already completed a prefeasibility study for its nearby Wolverine open-pit coal mine, based on an initial production rate of 1.6 million tonnes per year.

Capital costs were estimated at $116.1 million, with Western as the project’s owner-operator. The coal seams targeted for mining, and contained in the general pit area, total 49.3 million tonnes (measured and indicated), plus 2.8 million tonnes in the inferred category.

In other coal news, Hillsborough Resources (HLB-T) recently purchased a barge-loading facility in Campbell River for $3.35 million and 400,000 of its shares. The company paid $2.85 million from working capital and has until July 1 to pay the remaining $500,000.

Hillsborough operates the Quinsam coal mine on Vancouver Island and expects to sell 520,000 tonnes this year, or 82% more than in 2003.