Wildhorse has coal and coal bed methane exploration licence areas covering an area of approximately 418km2 in the Mecsek Coal Formation in the Pécs region in southern Hungary and these licences substantially overlap.

Considerable drilling, exploration and mining activities in relation to coal have been undertaken in the region and the Company’s licence area includes 400 historical drill holes. A review by independent geologists (CSA Global Pty Ltd) has resulted in an Exploration Target of 1-1.25 billion tonnes of coal at 18.8 to 29.3 GJ/t1. Permitting has commenced and has been completed on the first target area for a confirmation drilling program aimed at potentially converting a significant portion of the Exploration Target into a JORC Inferred Resource and drilling is expected to commence Q3 2010.

Wildhorse has an MOU with Dalkia, one of Europe’s leading energy services companies and its Hungarian affiliate PannonPower Holding Zrt (PannonPower), the owner of a 185MW power station located approximately 5km from the southern boundary of the Company’s exploration licence area. The MOU contains agreed principles and timelines for a proposed strategic equity investment in Wildhorse and a proposed long term gas supply agreement between the Company’s Mecsek Hills UCG Gas project and Pannon’s power station. Importantly, the MOU also includes a proposed collaboration to evaluate the potential to supply syngas to other Dalkia and affiliated power stations in Central Europe. PannonPower Holding Zrt is owned by Dalkia which is ultimately owned by the large French energy companies EDF and Veolia.

A Scoping Study has been completed on the project by Uhde Shedden, part of the large international engineering firm ThyssenKrupp Technologies, and this has confirmed that substantial financial returns are potentially achievable through the application of UCG to develop syngas as either a gas feedstock for sale to power stations or conversion into synthetic natural gas (SNG) for distribution through the international pipeline network.

Izabela Gas (UCG) Project

The Izabela UCG Project covers a 47.5 sq km coal deposit near the town of Dorog in north-west Hungary, a historical coal mining district which has undergone significant exploration. A preliminary review of data from 160 historic drill holes indicates that the coal has significant potential for UCG. Additionally, the project is within proximity of three power stations (one of which is owned by Dalkia) and a natural gas pipeline.

The Company is sourcing archive data on this project and is collating and translating the considerable information available on coal quality, geology and structure and converting this into a three dimensional database model. Wildhorse has also secured drill hole locations and coal stratigraphy data for 160 historic exploration drill holes within the licence area. Most of the exploration holes collected intersected coal seams, which helps considerably in de-risking the exploration phase of the project. The holes intersected coal from depths of 250m to 600m and display good coal continuity. There also remains considerable upside for new amounts of coal to be established as large areas of the licence area remain yet to be tested for mining or exploration.

The coal being targeted by the Company is part of the Eocene Dorog Coal Formation comprised of three to six flat lying, to gently dipping, sub-bituminous coal seams with calorific values in the 14-20 MJ/KG range. The structural regime is relatively simple with some steep dipping normal and reverse faults known to be present. Within the seam group there are three main seams which range in thickness from 2-8m and these formed the focus for historic mining.

From the coal information available to date, the Company considers that the coal appears likely to have significant potential for UCG. To assist in further evaluating the suitability for UCG and with the aim of producing an Exploration Target, Wildhorse has appointed CSA Global to review the coal within the licence area.

Amelie Gas (UCG) Project

The Amelie Gas (UCG) Project covers 25 sq km and is located in western Hungary, approximately 120km from Budapest and a power station, owned by MVM Zrt, is located approximately 10km from the licence area. EON's Gonyu power station, which has 433MW currently under construction, is approximately 80km away and the licence is also in close proximity to major gas distribution pipelines.

The Project, which has already undergone significant historical exploration, is known to contain significant sub-bituminous coal deposits which the Company believes are suited to exploitation by UCG.

Initial analysis of data from 84 drill holes within the tenement indicates that 90% of the holes intersect coal at depths of between 160m to 800m and importantly there is good coal continuity. The coal being targeted is comprised of three to five flat lying, to gently dipping, sub-bituminous coal seams with calorific values in the 14-18 MJ/kg range. The structural regime is relatively simple with some steep dipping normal and reverse faults known to be present. Within the seam group there are two main seams which range in thickness from 1.5-5m.

Independent geologists CSA Global have been appointed to review the available project data and the geology of the licence area to assist in further evaluating the suitability for UCG and with the aim of producing an Exploration Target.

Mecsek Hills (Pécs) Uranium Project

Wildhorse’s 72 sq km Pécs Project is located within the Mecsek Hills Project Area and contains highly prospective ground with potential for significant expansion beyond the existing JORC Inferred Resources of 17MT at 0.08% U3O8 for 30Mlbs of U3O8. The current Exploration Target for the total project area is 90-120Mlbs of contained U3O8 with a grade range of 0.08-0.12%1

The Mecsek Hills is a historically uranium producing region, providing the area with existing infrastructure and a skilled workforce. Wildhorse has a strong knowledge of the area, with an extensive historical drill hole data base which includes in excess of 400 holes in the project area. Its Pécs Project, includes two licences, Pécs and Abaliget, and is adjoined to the western boundary by the MML-E license held by Mecsek-Oko. The uranium orebody on this licence is shallower and offers potential access through uranium bearing sandstones onto the concessions into Wildhorse’s existing area of JORC resources. Wildhorse has agreements in place with Mecsek-Oko and Mecsékerc, two state owned uranium/nuclear related companies, to jointly develop their combined licences and ultimately develop and restart a uranium mine.

In line with this, Wildhorse aims to complete a technical and economic review of the Mecsek Hills project, which includes the consolidation of the geological model, refining an underground mine design, preliminary evaluation of the environmental impacts and socio-economic studies. Assay results at the area confirmed the high grade mineralisation potential of the Mecsek South target area with one grade of sample interval reporting 1,963ppm of U3O8. Assays will be used to generate an upgraded JORC Inferred Resource for the Mecsek Hills Uranium Project.

Mine For

coal, ucg, uranium

Location of operation(s)

United States, Hungary, Paraguay

Address

Level 21 Allendale Square, 77 St Georges Tce
PERTH, WA, AUSTRALIA

Phone

08 9389 2000

Email

Website

http://www.wildhorse.com.au/

Last Updated

19/01/2011