Coal explorer Draig Resources (formerly C @ Ltd) has re-listed on the Australian Stock Exchange following a successful capital-raising and acquisition venture. Draig has acquired eight coal licences, including Teeg, in Mongolia’s Ovorhangay and South Gobi provinces, after raising $17 million in a share sale.
The company’s managing director Mark Earley says, “We now have the financial capacity to move forward with the development of what we believe will be a very good quality coal project. We will continue drilling through the Mongolian winter months, with the aim of establishing a JORC compliant resource on the project early this year.”
The company recently began a geophysical survey to identify the potential black coal extensions within the Teeg licence. The survey will help Draig to identify the key drilling targets for its 2012 exploration program. Five holes were drilled at Teeg during June and July 2011, where black coal seams measuring up to 60 metres were intersected.
Three of the company’s other licences are also in the Ongi River basin within the Ovorhangay province, about 130km from the provincial capital Aryayheer and about 520km south west of the Mongolian capital Ulaanbaatar.
The remaining four are in the South Gobi basin and are bordered by the closest town Gurvantes and the Chinese border 80km to the southwest. They are characterized by the largest concentration of major black coal deposits in Mongolia, including the 5 billion tonne Tavan Tolgoi and 200 million tonne deposits at Baruun Nuran and Ovoot Tolgoi.
Draig says all of the licences have had little exploration but offer considerable potential. A number of the licences are close to existing producing assets and infrastructure with close proximity to major energy markets like China and Russia.
Mark Earley says the company is also excited by the Mongolian government’s plan to build a 5700km railway connecting the South Gobi to the Russian ports of Zarubino, Vanino and Vladivostok. The first stage of construction is expected to begin in 2012.