The Company through its Botswana subsidiary, Weldon Investment (Pty) Ltd, holds three prospecting licenses that covered an area of 964km² in Botswana (note 50% relinquished under the first renewal application). The licenses, PL339/2008 and PL340/2008 are together known as the Serowe Project, whilst PL341/2008 is known as the Kweneng Project. The Serowe Project is located immediately north of Botswana’s only producing thermal coal mine, the Morupule Coal Mine.
The Kweneng Project is 25kms west of Canadian listed CIC Energy’s Mmamabula Coal Project who recently announced it had entered into a binding agreement with Jindal Steel and Power Ltd regarding a potential takeover that is expected to close in October 2012. A Phase 1 drilling exploration diamond drilling program was completed in 2011 and 2012 with subsequent sample analyses completed. The program was undertaken by Botswana based exploration drilling company Discovery Drilling Contractors Africa (Pty) and managed by the Company’s independent geologists Gemecs Pty Ltd.
Phase Two Drilling Program
Based on the positive results from Phase 1 drilling program, the Company has committed to a Phase 2 exploration drilling program across both the Kweneng and Serowe Coal Projects. The primary aim of the Phase 2 exploration drilling program will be to both increase existing resources, increase the level of confidence in the extent, continuity and quality of the known resources and to convert a significant portion of the Exploration Target into JORC compliant resources on the Serowe and Kweneng Coal Projects. In addition, based on the Phase 1 drilling results the Company has elected to advance its discussions with several strategic parties that have already expressed an interest in participating in its exploration and long term investment activities across its Botswana Coal Projects.