Summary:
Olive Downs South
Alluvium and semi consolidated sediments consisting of sand, clay and gravel cover the deposit area. This material is described as Tertiary but a component of it is likely to be Isaac River Quaternary sediments. Tertiary/Quaternary sediment thickness increases towards the south. Average depth of Tertiary is in the order of 45 metres ranging from 0 to 90 metres.
Willunga
In the Willunga area the average depth to the base of Tertiary is in the order of 20 metres ranging from 0 to 70 metres in the resource area. The thickness of Tertiary does not seem to be related to the current river location. There does not appear to be any clear relationship between the Tertiary depth and the structure of the areas. There are no indications of any surficial basalt in either Olive Downs South or Willunga.
Weathering
Olive Downs South
Average depth of weathering is in the order of 65 metres ranging from 20 to 80 metres. Comparison of depth of weathering with depth of Tertiary indicates almost no consistent relationship, however both increase to the south.
Willunga
Average depth of weathering is in the order of 60 metres ranging from 20 to 100 metres. There appears to be a broad relationship between the depth of weathering and the structure of the area - the deeper weathering occurring in the syncline.
Coal seams
Olive Downs South
The Leichhardt and Vermont Seams of the RCM form the principal economic coal resources in the ODS resource area. In this area the principal seams have been named Lower Leichhardt 1 (“LL1”), Lower Leichhardt 2 (“LL2”), Lower Leichhardt 3 (“LL3”), and Vermont Upper 2 (“VU2”). The Vermont Upper 1 (“VU1”) is thin and non-pervasive. A high gamma marker occurs several metres below the floor of the Vermont Upper Seam and it is interpreted to be the Yarrabee Tuff. The Yarrabee Tuff ranges from 0.5 to 1.5 metresthick. This tuff marks the interpreted top of the FCCM.
The LU Seam is thin, generally less than 0.5 metres. It has an average raw ash of 23%. The LL1 Seam is thin 0.5 to 1 metres in the north and south thinning to less than 0.5 metres in the central portion of the deposit. It has an average raw ash of 22%.
The LL2 Seam consists of a dull upper working section (“LL2T”) with an average thickness of 1.7 metres. This section has a low CSN but can produce a satisfactory PCI product. The LL2B Seam basal section has an average thickness in the order of 1.8 metres. This section can produce both coking and PCI product (based on sizing).
The LL3 Seam consists of an upper working section (“LL3T”) that averages 1 metre thick. This section thins to less than 0.5 metres in the north. The basal LL3B Seam section has an average thickness in the order of 0.9 metres. Despite the LL3 Seam being split into two sections in the structural database, Peabody has combined the sections for the product quality assessment probably due to the thin thickness of the combined unit. The LL3 Seam is close to the LL2 Seam in the southern half of the deposit.
The VU2 Seam averages 3.8 metres thick ranging from 1.5 to 6.5 metres. This seam appears to have larger thickness variability probably as a result of thrust faulting. This seam has an average raw ash in the order of 18% and will produce coking coal.
The Vermont Lower Seam (“VL1”) is high ash, banded and not considered prospective. The VL1 Seam is close to the VU2 Seam in the north but splits away to the south and is more than 20 metres below the VU2 Seam over most of the deposit.
All seams show reasonably consistent trending in thickness with some bull’s eye seam thickness variation due to faulting, natural sedimentary variation, and in uncommon cases, igneous intrusion thickening the seam. The VU2 Seam shows the most thickness variation. Fault thickening and seam repeats are not uncommon in the fault zones. Anomalous thicknesses (super thick or super thin) are generally removed from the modelling data. Seam repeats are not included in previous resource estimations or this assessment. It is possible that mining losses around fault zones could be offset by gains from seam repeats.
The coefficient of variation (“CV”) is one of many statistical methods that provides an indication of the variability of an element. The CV is defined as the ratio of the standard deviation to the mean. Data sets with a CV below 1 are considered low-variance. The following charts show the CV’s for ply thickness. The CV’s of ply thickness are, with few exceptions, well below 1 indicating low variance. This is supported by contour plots of these parameters.
Willunga
As for Olive Downs South, the Leichhardt and Vermont Seams form the principal economic coal resources in the Willunga resource area. The principal seams are LL1 Seam, LL2 Seam, LL3 Seam, VU1 Seam and VU2 Seam. The high gamma marker at or near the floor of the Vermont Upper Seam is interpreted to be the Yarrabee Tuff.
The uppermost seam in the sequence is the LU Seam. The occurrence of this seam is inconsistent and it is not regarded as a resource. The LL1 Seam is thin 1 to 2 metres and tends to thicken to the south. The seam has a high raw ash.
The LL2 Seam consists of an upper working section (LL2T) having a moderate raw ash in the order of 22%, a high ash middle section (LL2M generally >50% ash), which tends to be stony. The LL2B Seam basal section is generally low ash. The LL2 Seam splits rapidly and deteriorates approximately 1 km south of the Isaac River. The LL2 Seam splits are set to zero thickness in this area. Both the LL2T and LL2B Seam sections thin to the west, however the LL2B Seam thinning has a more severe effect on ratios in the western lobe of the resource area.
The LL3 Seam is generally less than 1 metre thick. This seam also thins and deteriorates south of the Isaac River. The Vermont Upper Seam splits into its components, VU1 and VU2, in the central and central north areas. The VU1 Seam is in the order of 1 to 1.5 metresthick. The VU2 Seam is thick where it coalesces with the VU1 Seam (~3.5 metres) but thins rapidly away from the split line to less than 1 metre.
There is a fair variation in seam thickness in Willunga. Seam thickness variation is due to natural sedimentary variation faulting and in uncommon cases igneous intrusion thickening the seam.
Willunga seam CV are slightly larger than the ODS seam CV indicating greater variability.
The ODS coal seams will deliver both high rank, low volatile coking coal product. The reflectance of the ODS seams is in the order of 1.30% to 1.40%. Lowering seams may be beneficiated to a PCI product. Phosphorus (“Phos”) is not excessive (<0.08) with the exception of the LL2T, section which will only produce a PCI product. Despite a fair degree of structural deformation, the seams in this area demonstrate reasonably consistent trends in quality. Willunga coal seams will deliver a low volatile PCI produc. The reflectance of the Willunga target seams is in the order of 1.70% to 1.90%.