Asenjo Energy Coal Project

The Company holds the Western Mmamabula, Dukwe and Lechana-Tshimoyapula large thermal coal projects in Botswana, collectively known as the Asenjo Energy Coal Project. In August 2007 it reached agreement with a consortium comprising Jonah Capital (BVI) Limited and Sentula Mining Limited in terms of which the consortium may earn a 50% interest in the three projects by undertaking a US$10 million exploration programme. The purpose of the programme is to complete a Pre-Feasibility Study level of assessment in respect of the development of one or more of the projects.

The exploration programme includes:

• approximately 30,000m of percussion and diamond drilling across the tenements;
• completion of JORC resource statements; and
• completion of a Pre-Feasibility Study on one or more of the project areas which contemplates the development of a large scale thermal coal mine.

Exploration activities to date comprise 14,000m of drilling on the Dukwe Project, together with coal quality test work over all of the project areas and additional drilling has recently commenced at the Western Mmamabula Project.  In addition, airborne aeromagnetic survey work is currently underway over all three areas.

Each of the three project areas contains non-JORC compliant insitu coal resources in excess of 1 billion tonnes (4.1 billion tonnes in the case of the Western Mmamabula Project), providing a highly prospective target area from which to identify suitable coal resources for a potential co-development opportunity in order to provide thermal coal for the expanding power generation requirements of Southern Africa, in particular, South Africa, Botswana and Namibia.