Shares of SouthGobi Energy Resources (SGQ-V, SGQRF-O) vaulted $1.90 apiece on news that the company’s total measured and indicated surface resource of coal in southern Mongolia has grown by 73% to 258.9 million tonnes and its inferred resource by 399% to 145.3 million tonnes.
According to a new National Instrument 43-101-compliant report, Ovoot Tolgoi’s west field now contains measured plus indicated coal resources of 193.2 million tonnes with an additional inferred resource of 138.8 million tonnes.
The report used exploration data up to December 2007 for the west field surface area, down to a depth of 250 metres.
A similar exploration and development program will be carried out in the southeast field’s surface and underground areas next year.
Ovoot Tolgoi started producing thermal coal, premium thermal coal and metallurgical coal from the west field in April.
Holes in the 2008 exploration program are being drilled to a depth of 800 metres. New resource estimates for the west field are planned for the end of the year.
SouthGobi Energy is exploring and developing Permian-age metallurgical and thermal coal deposits in Mongolia’s South Gobi region as well as in East Kalimantan, Indonesia.
The company’s strategy is to supply coal products and electricity to Asian markets. It is also investigating clean-coal technologies.
SouthGobi closed up 11% to $19 apiece. The Vancouver-based company has a 52-week trading range of $5.06-21.99 with 132.64 million shares outstanding.
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