NORTHERN ENERGY CORPORATION LIMITED - ASX: NEC

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Description

Northern Energy Corporation Limited (ABN 90 081 244 395) is an ASX-listed company (ASX Code: NEC) with coal projects in Queensland and New South Wales, Australia. The Company has interests in a portfolio of coking and thermal coal projects being progressed towards development. These projects represent a diversified suite of geographically spread resource development opportunities involving various coal types and mining methods. Northern Energy's current portfolio includes:

- the Colton Hard Coking coal project (EPC923 and EPC1082), near Maryborough, Queensland;
- the Elimatta Thermal Coal project (EPC650, EPC1170 and EPC1205), located approximately 30km west of Wandoan, Queensland;
- the Yamala Thermal / PCI coal project (EPC927), between Emerald and Blackwater, Queensland; and
- the Ashford Hard Coking coal project (EL6234 and EL6428), north of Inverell, New South Wales.

The Company is well-funded to continue its progression from explorer to mine developer and coal producer. Northern Energy has established significant industry partnerships and has plans to grow and expand its relationships as it makes the transition from explorer to mine developer. The Company is well-positioned to take advantage of the in ground value of its resources to meet strong ongoing market demand for both thermal and hard coking coal.

Maryborough, Queensland (100% NEC) - Hard Coking Coal

ESTIMATED RESOURCES : ~200 Mt
Indicated Resource : 9.8 Mt
Inferred Resource : 73.5 Mt
Exploration Target : 105-137 Mt

MARKETABLE RESERVES : 5.9Mt
Probable Reserve : 5.9Mt

Following a short exploration program partly funded by the Japanese Government organisation NEDO, Northern Energy confirmed the presence of coal with good coking properties within the Cretaceous Burrum Coal Measures on the western limb of the Burrum syncline north of Maryborough within EPC923. This area had previously been the subject of small scale mining for many years. A review of the drilling results, historical information from previous mining activity in the area and the potential availability of port infrastructure was undertaken in relation to the Maryborough project. In July 2009 the Company announced an initial 5Mt inferred resource and this was followed over the next twelve months by a series of upgrades and improvements as more information was made available from drilling and analysis.

Elimatta, Queensland (100% NEC) - High volatile, low nitrogen, low sulphur export thermal coal

ESTIMATED RESOURCE: ~244 Mt
Measured Resources : 129 Mt
Indicated Resources: 75 Mt
Inferred Resources : 40 Mt

MARKETABLE RESERVES : 105.8 Mt
Proven Reserves : 82.3 Mt
Probable Reserves : 23.5 Mt

Located approximately 30km west of the township of Wandoan, the Elimatta project has been confirmed as a large resource of low ash, high volatile thermal coal. Since completion of Northern Energy's initial mine assessment in December 2008 further evaluation of the Elimatta deposit has continued. A detailed life of mine plan has been developed for the deposit, incorporating the results of surface hydrology and geotechnical studies completed in late 2008. A reconfiguration of the mine layout and mining direction followed redesign and retiming of the proposed diversion of Horse Creek following completion of the hydrological studies.

Yamala, Queensland - PCI/Thermal Underground

ESTIMATED RESOURCE: ~400 Mt

EPC927 is located 6kms to the west of Comet, in the Central Bowen Basin. It is located approximately mid-way between Emerald and Blackwater on the Capricorn Highway. The tenement is bordered to the north by Ensham's MDL217 and to the south by Togara North's MDL316 and EPC550. The target coal in EPC927 is a strike continuum of the coal sequences defined in Ensham and Togara North. The rail line from Emerald to Gladstone also passes through the EPC.

Ashford, New South Wales (50% NEC) - coking Coal

ESTIMATED RESOURCE: ~18 Mt

The Ashford Project is a 50/50 joint venture with Renison Consolidated Mines and is located 10km north of the township of Ashford in northern New South Wales. A systematic assessment of the additional exploration tenements held in the region conducted by the joint venture did not result in any increase in the previously reported resource. As a result the Company is considering a development based on the 18Mt Inferred Resource previously outlined at Ashford, possibly in conjunction with other deposits identified by third parties in the region. Transport and port infrastructure capacity for Ashford remains the key issue to be addressed for the project. A rail link into Brisbane from the Ashford region or improved access to Newcastle would enhance the prospects for the development of this project. The Commonwealth Government has decided on the preferred route for the proposed inland railway which will run to the west of Ashford. This project would bring heavy haul rail capacity much closer to the Ashford project and thus increase the prospects for a viable development of the existing resource. The Company continues to monitor potential transport infrastructure development in the area.

Yetman, New South Wales - Oil Shale

ESTIMATED RESOURCE: ~unknown

The Yetman Project contains two Exploration Licences, EL6946 and EL6947, located near the towns of Yetman and Wallangra in New South Wales. Preliminary work which has been carried out in the area includes landholder access and liaison, geological studies, assessment of historic drilling in the region and outcrop mapping. Results of the work to date have located a number of sub-crops and float samples of Oil Shale and coaly carbonaceous shale which are considered encouraging for forward program planning. Comprising over 100 sq. km. the Yetman Project is considered to be a potential host for further Ashford-style deposits of coking coal and other high value material.

Mine For

coal

Location of operation(s)

Queensland, New South Wales

Address

Level 5 , 60 Edward Street
BRISBANE, QLD, AUSTRALIA

Phone

07 3303 0695

Email

Website

http://www.northernenergy.com.au/

Last Updated

3/3/2011