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1 MOZAMBI COAL LTD (ASX: MOZ, Company or Mozambi ) ASX RELEASE 7 SEPTEMBER 2011 EXPLORATION PROGRAMME UPDATE is pleased to announce an update on exploration activities in Mozambique including the results of first pass stratigraphic drilling at the Company s Tete West project in the Tete Province, Mozambique. Highlights Five Diamond drillholes completed for a total of 1, metres. Results from 35 samples received, 17 are pending. Karoo Coal Seams intersected. First pass drilling of Songo project expected to commence early next quarter. Tete West - Results Summary First past stratigraphic diamond drilling of the northeast corner of the Tete West Project (Figure 2) has been completed with the successful intersection of some Karoo Coal Seams. The coal seams encountered in the licence area are generally thin and the quality is average for the Tete Province. The Company is incorporating the drilling results into its geological model for the licence area. Songo - Planning The Company expects to commence first pass stratigraphic diamond drilling and down hole geophysical logging of selected target areas within its Songo Project as soon as appropriate equipment can be secured. In addition, an airborne magnetic survey is planned for this licence as well as the Company s Muturara Project situated 58km southeast of Tete. Both activities are planned for early next quarter. Detailed Results Tete West A total of five diamond drillholes have been completed using a Longyear 38 drill rig supplied by Agua Terra Limitada. Collar details of the drillholes are detailed below (Table 1). Table 1: Drillhole Collar Details. Borehole ID East North Elevation Depth (m) BH C BH C BH C BH C BH C Total m
2 Detailed geological logging of the core is underway to determine the stratigraphic position of the intersected coal seams with the view to correlate this information with other known coal seams in the region. Results for 35 samples have been received to date with 17 assays pending. The samples were tested for proximate analysis on an air dried basis. The results were grouped and weight averaged for each drillhole to produce the average quality. Correlation of the seams and estimation of quality of each seam will be finalised once the remaining results are received. These theoretical total cumulative coal parameters are presented below. Table 2: Main Weighted Average Coal Quality Results. Hole ID Cumulative coal seams thickness IM% Ash% VM% FC% CV% MJ/Kg TS% SI RD C1 4.15m C2 8.00m C3 5.15m Note 1: Sampling for coal is undertaken for each borehole. Based on physical properties sample plies are made as per standard sampling procedures. The coal samples collected were packed in air tight plastic bags and labelled clearly before sending to the local ACT-UIS Laboratorios de Mocambique, LDA laboratory for sample preparation. The prepared sample pulps were then sent to Witlab (Pty) Ltd, an ALS group Coal Testing facility in South Africa who are an ISO 17025;2005 certified laboratory with the accreditation valid until November The samples were tested for Proximate analysis on air dried basis including inherent moisture (IM%), ash (%), volatile matter (VM%), fixed carbon (FC%), calorific value (CV MJ/kg), total sulphur (TS%), swelling index (SI) and relative density equivalent to specific gravity (RD). Based on the above information the Company is likely to revise its target mineralisation estimate for Tete West downwards. The Company s two largest potential projects remain untested as per the previously announced exploration targets (Table 3). Table 3: Mozambi Target Mineralisation Project MOZ Ownership Total Area Karoo Area Target Mineralisation Songo 2738L Right to earn 80% 224 km km 2 of Lower Karoo billion tonnes* Muturara 3246L 70% 203 km km 2 of Upper Karoo billion tonnes* Tete West 3245L 70% 182 km km 2 of L & U Karoo million tonnes* * This Target Mineralisation estimate is conceptual in nature as there has been insufficient exploration to define a mineral resource under JORC Code guidelines and it is uncertain whether further exploration will result in the determination of a mineral resource. This conceptual target may or may not be outlined with future work, either in whole or in part.
3 Figure 1: Location of Tete West Project (3245L) Figure 2: Drillhole area location map
4 Figure 3: Drillhole Area Geology Map
5 About Mozambi Mozambi Coal Ltd is a coal exploration company listed on the Australian Securities Exchange under ASX code MOZ. The Company intends to develop as an Africa-focused coal mining company through the exploration and development of its existing exploration licences in Mozambique, East Africa, and the acquisition of further assets in the region. The Company has a 70% interest in two mineral exploration licences situated in the Zambeze Coal Basin in Mozambique and in July 2011 announced an agreement to acquire an 80% interest in a third exploration licence, 2738L ( Songo Project), also within the Zambeze Coal Basin. The Zambeze Coal Basin is an emerging and highly prospective coal region that is within economic reach of the East African coast. Globally significant resources companies including Rio Tinto (LON:RIO), Vale, Jindal Steel and ENRC have undertaken coal exploration and development projects in the basin. The combined tenement size held by the Company is approximately 609km 2, spanning three tenements, 2738L ( Songo project) 3245L ( Tete West project) and 3246L ( Muturara project). 2738L is located 115km west of the city of Tete and 40km southwest of Jindal licence 1218L where a 700 million tonne coal reserve has been identified. 3245L is located 12km West of the city of Tete and extends over 182km 2, and lies immediately southwest of Rio Tinto tenement 946L. 3246L is located 58km 2 southeast of the city of Tete and covers approximately 202 km 2. The tenement is located 45km southeast of the Moatize Coal Mining Camp owned by Vale. Figure 4: Map of Mozambique within Africa Figure 5: Map of Mozambi Coal s Tenements within Zambeze Basin
6 Competent Person s Statement The information in this report which relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Brian Varndell, who is a Fellow member of the Australasian Institute of Mining and Metallurgy and independent consultant to the Company. Mr Varndell is an associate of Al Maynard & Associates and has over 35 years of exploration and mining experience in a variety of mineral deposit styles including iron ore mineralisation. Mr Varndell has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Varndell consents to inclusion in the report of the matters based on his information in the form and context in which is appears.
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