Montem Resources (ASX: MR1) reported that 13 drill holes at its Chinook Vicary project have intersected thick coal seams.
Maximum cumulative coal thickness across those holes was 61.1m, with an average thickness of 22.7m.
The company says drilling confirms the occurrence of near-surface, structurally thickened coal zones suited to open cut mining.
The Chinook project mining scoping study will be completed this month.
Montem’s Canadian projects are all located in the Crowsnest Pass of Alberta province.
Rail and port access have been established for exporting the coal.
Montem’s aim has been to confirm the quality of Chinook Vicary’s hard coking coal which historically was supplied to the Japanese steel industry from the Vicary mine that closed in the late 1970s.
It has a strike length of more than 40km of identified coal resources and is made up of two areas — Chinook Vicary and Chinook South.
Chinook has a JORC resource estimate of 149 million tonnes of coal, of which 103Mt is indicated, the remainder inferred.
Chinook also contains an additional coal exploration target estimate of between 125Mt and 450Mt at Chinook Vicary.
Progressing to reopen Tent Mountain mine
Montem also plans to reopen the Tent Mountain mine, which closed in 1983 due to poor market conditions. That mine was another operation that produced high quality coal for export to Japan.
Mining there is expected to begin in the first half of 2022 at the annual rate of 1.1Mt.
Montem’s Chinook project covers an area of 9,746 hectares.
Meanwhile, the company is moving the Tent Mountain project through the regulatory process and during the December quarter made progress on environmental applications ahead of the restarting of operations there.
Before mining can resume at Tent Mountain the compliant mine and environmental permits from previous operations must be amended.
The definitive feasibility study produced what the company describes as “robust” economic results from open cut operations producing 1.1Mt of sales per annum.
The company also announced this week that it has renegotiated an agreement for buying land for the operation to load coal on to railway wagons.
Montem’s mines are located near the operations run by Canadian giant Teck Resources, that country’s major producer of coking coal.