Lowmead Oil Shale Deposit. Resource Estimate Update

Transcription

1 Resource Estimate Update September 2014

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3 STATEMENT - SPE-PRMS PETROLEUM RESOURCE ESTIMATE - LOWMEAD This report is an update on the initial SPE-PRMS report for the Lowmead Oil Shale deposit issued in April The criteria and assumptions which underpin the estimate were reviewed and remain unchanged. The Petroleum Resource estimate is based on the discovered Petroleum Initially in Place (PIIP); estimated using polygonal blocks. The methodology used is a deterministic method where the JORC 2012 guideline levels of categorisation (Measured, Indicated and Inferred) quantify the range of uncertainty or confidence levels for the deposit. The estimate is based on the following constraints and data: Interpretation of intersected stratigraphy in 23 pre-collared cored and auger sample drill holes drilled to a maximum depth of 520 metres below surface for an aggregate 4,500 metres. The maximum depth for the estimate is 400 metres. Oil grade has been determined by modified Fischer Assay (ASTM D ) on 1,233 core samples representing approximately 2,400 metres of cored material. An in-situ grade cut-off of 50 litres per tonne at zero per cent moisture (50LT0M) has been applied. The resource is contained within an elongate surface area of 23.4 square kilometres. A recovery factor of 0.95 has been applied to the in-situ estimate based on published recovery data from a number of conventional retort technologies both operating and under development. The total estimate as at 30 September 2014 is apportioned to the tenement holders according to their beneficial interests in the Lowmead deposit in Table 1. Table 1: SPE-PRMS Petroleum Resource Estimate. Total Resources Beneficial (Mbarrels) Interest 1C 2C 3C Greenvale 50% QER 50% TOTAL 100% The level of investigation at Lowmead is at stage where the drill hole density does not support the estimation of 1C resources. Contingent Resources are those quantities of petroleum estimated, as of this report date, to be potentially recoverable from known accumulations using established technology or technology under development. Commercial recovery of oil from Lowmead shale has not been established and as such the contingent resources cannot be classified as petroleum reserves. At Lowmead, resource development is considered unclarified or not viable based on the current immature state of knowledge of commercial recovery due to one or more of the following contingencies. Lowmead Oil Shale Resource Statement September 2014 Page 2 of 9

4 Development requires the application and grant of a mining lease and environmental approvals from the Queensland Government based on a commercial mine and processing proposal; i.e. legal, environmental, social and governmental factors for development have not been either established or approved. A commercial mine and processing development has not at this time been assessed against any current and forecast economic conditions to support commercial viability. Commercial recovery is dependent on the suitability of Lowmead oil shale to be processed in current retorting technology or technology under development. Competent Person The petroleum resource estimates for MDL 188, Lowmead Oil Shale Deposit provided in this statement were determined by Mr Graham Pope, a full-time employee of QER Pty Ltd, Brisbane, Australia, in accordance with Petroleum Resource Management System guidelines. He has given his consent to the use of the resource figures in the form and context in which they appear in this statement. Mr Pope: has a BSc(Applied Geology) and MSc and is a Member of the Australian Institute of Geoscientists, Australasian Institute of Mining and Metallurgy and Petroleum Exploration Society of Australia. has more than 30 years experience in the exploration, development, assessment and evaluation of oil shale deposits and is a qualified person as defined under the ASX Listing Rule is a full-time employee of QER Pty Ltd, Brisbane, Australia and is independent of Greenvale Mining NL does not receive any remuneration that is linked to the admission or value of the applicant is not a sole practitioner. Lowmead Oil Shale Resource Statement September 2014 Page 3 of 9

5 ADDITIONAL INFORMATION Project Description The Lowmead oil shale deposit is approximately 70 kilometres south of Gladstone near the rural township of Lowmead (Figure 2). It is close to major arterial road and rail services that provide access to the site. It is approximately equidistant between the ports of Gladstone and Bundaberg. Tenement Status Title to the resource is held by virtue of Mineral Development Licence Application 188 granted in October Subsequent renewals have been granted to 30 September An application for the renewal of MDL 188 for a further five years is being processed by the Queensland Department of Natural Resources and Mines. Interest in the Lowmead Oil Shale Deposit is held by a joint venture, consisting of Greenvale Mining NL and Queensland Energy Resources Limited in equal shares. Geological Setting Regional geological setting Tertiary sedimentary rocks of the Lowmead Graben are contained within a northwesttrending graben about five kilometres west of the Electra Fault. This fault is the major structural feature of the region and it has been traced for 150 kilometres trending northnorthwest. It forms a structural boundary between metasedimentary rocks. A suite of Late Palaeozoic to Triassic igneous rocks (Coastal Block) occurs to the west, with Permian to Triassic sedimentary and igneous rocks of the Rosedale Block to the east. The fault is thought to mark the presence of a pronounced, deep structural feature. There are several subsidiary faults parallel to the Electra Fault. Like the Electra Fault, they are down-thrown to the east, and are believed to have first become active in the Triassic. Movement during the Tertiary on the Electra Fault and its associated subsidiary faults led to the formation of the Lowmead Graben and the preservation of the accumulated sedimentary rocks within it. The horst-blocks of the Coastal Block flanking the graben, and forming the graben floor, consist of igneous rocks of the Permo-Triassic Miriam Vale Granodiorite Complex, metasediments of the Devonian-Carboniferous Curtis Island Group and the Triassic Agnes Waters Volcanics. The Lowmead Graben Sequence Tertiary Lowmead Formation The Lowmead Formation is an interbedded sequence of claystone, oil shale, carbonaceous oil shale and sandstone. Sparse outcrops have been mapped, but all are moderately to highly weathered. The present known limits and structure of the Lowmead Graben are based on reconnaissance mapping, photogeological interpretation, geophysical surveys and drilling results. Lowmead Oil Shale Resource Statement September 2014 Page 4 of 9

6 McConnochie and Henstridge (1985) defined the name Lowmead Formation and subdivided the sequence into six conformable members based on drill-core-derived data from sections of LDD001, 007, 014 and 016 (Figure 1). The Members of the Lowmead Formation are described in Table 2. The composite intersected thickness of the type section is 603 metres with the oil shale Members aggregating 225 metres thickness. Table 2: Lowmead Formation Summary Description of Members. Member Sonoma Makowata Oil Shale Korenan Oil Shale Wheatley Oil Shale Lithologic and Stratigrapic Description Claystone is dominant, with interbedded carbonaceous oil shale, oil shale and minor sandstone. The claystone is olive grey, moderately hard and massive Brownish-black carbonaceous oil shale is the dominant rock type, interbedded with minor claystone beds. The oil shale beds are comprised of alternating clay, kerogenous and carbonaceous to coaly laminae separated by massive olive grey claystone beds up to 4.5 metres thick. The dominant rock is dark to dusky yellowish brown oil shale. It is subdivided into upper and lower units based on lithology and oil yield. The upper Korenan Oil Shale is moderately hard, massive to laminated oil shale. The lower Korenan Oil Shale is hard, laminated and dusky yellowish-brown with minor carbonaceous oil shale interbeds. Carbonaceous oil shale is the dominant rock type. It is brownish-black, hard and composed of alternating clay and carbonaceous to coaly laminated beds, separated by claystone. True Thickness Average (Range) metres Oil Yield Average LTOM 50LT0M Cut-off Up to ( ) Upper 36 ( ) Lower 23.7 ( ) ( ) 87 Harpur Creek Hobble Creek* Unconformably overlies Palaeozoic and Mesozoic rocks in places and elsewhere conformably overlies the Hobble Creek Member. Claystone is the dominant rock type with abundant interbedded oil shale, sandy claystone and sandstone. A marker oil shale bed (MOSB) occurs in the mid-section of this member. It consists of dusky yellowish-brown to olive-grey oil shale. Unconformably overlies Palaeozoic and Mesozoic rocks. The dominant rock type is silty to sandy, reddish-brown claystone. The Member contains some interbeds of green claystone and white sandstone and conglomerate. Harpur Creek 40.2 ( ) MOSB 11.2 ( ) At least 28.1* *Due to lack of structural data for the Hobble Creek Member only intersected thickness values are given. Harpur Creek 90 MOSB 93 No data for this unit. Lowmead Oil Shale Resource Statement September 2014 Page 5 of 9

7 Quaternary Sand, silt and gravel, associated with present-day drainage, unconformably overly the weathered Tertiary sedimentary rocks. The Quaternary overburden is thickest in the east, along Baffle Creek and its tributaries, and thins to the west to form a veneer over the weathered Tertiary and basement rocks. The Quaternary overburden is dominantly sand. from McConnochie and Henstridge, 1985 Figure 1: Type Section for the Lowmead Formation. ESTIMATE of RESOURCES The Lowmead Oil Shale Deposit is estimated to contain 1.72 billion tonnes of oil shale. The estimate of oil shale mineralisation is based on the total amount of oil shale using the grade and thickness cut-off criteria (minimum 4 metre thickness at 50 LT0M). The in-situ estimate of shale oil to 400m maximum depth is summarised in Table 3. Table 3: Lowmead Shale Oil-In-Place Resource Estimation Summary Resource Category* Tonnes x 10 6 Grade LT0M Moisture weight % Shale Oil inplace barrels x10 6 Shale Oil 95% recovery Indicated Inferred Total *Drill hole density and points of observation are insufficient to estimate measured resources. Lowmead Oil Shale Resource Statement September 2014 Page 6 of 9

8 Figure 2: Tenement Locality and Resource Lowmead Oil Shale Resource Statement September 2014 Page 7 of 9

9 REFERENCES McConnochie, M.J. & Henstridge, D.A. 1985: The Lowmead Graben - geology, Tertiary oil shale genesis and regional tectonic implications. Aust. J. Earth Sci. 32 pp Lowmead Oil Shale Resource Statement September 2014 Page 8 of 9