Hunnu Coal: Acquires another Mongolian coal project

Hunnu Coal acquires 60 percent interest in Tsohio Coal Project in an effort to further expand in the South Gobi Coal Province.
Hunnu Coal has acquired 60 percent interest in the Tsohio Coal Project. The project is located in the Umnugobi Province of Mongolia, roughly 40 kilometres south of another coal project owned by the Company, the Khuree-2 project. For the Khuree-2 project, Hunnu Coal is currently taking on both the mapping and a geophysics exploration programme. The Company hopes to identify coal seams at the Khuree-2 project site, in which case a drilling programme would commence in July of 2010.

The Tsohio Coal Project has not been explored in that past, however Hunnu Coal has found a coal seam outcrop that is roughly three kilometres in strike length. The coal seam has been intersected in a single trench, and has a thickness of around five meters. The exploration target the Company has for the Tsohio project, based off of initial findings, is 50Mt to 75Mt. The project exists only 60 kilometres north of the Mongolian and Chinese border. The exploration license was granted covering 38,600 hectares. The site is highly prospective for both thermal coal and coking. This announcement comes after Hunnu’s recent acquisition of 90 percent of the Tsant Uul Coal Project, which was announced on May 26, 2010.

The Company also is working on a mapping and geophysics programme 80 kilometres north of the Tsohio Coal Project, at the Tenuun-2 Coal Project. Through the mapping process the Company has identified extensive coal outcrop in the north west of this site, which has never been drill tested. Further work at the Tenuun-2 site will be completed at this zone before drill testing this year.

Hunnu Coal plans to undertake detailed exploration on the Tsohio, Khuree-2 and the Tenuun-2 Coal Projects in upcoming months as part of its coking and thermal coal exploration strategy in the South Gobi Province.