NEURIZER LTD - Proxy Solicitation & Information Statement 2015

27 April 2015

Manager Companies Companies Announcements Office

Australian Securities Exchange Ltd

ASX Code: MTN: 2015 Extraordinary General Meeting

As recently foreshadowed the Company is pleased to confirm its Extraordinary General Meeting ( “EGM”) will be held on Wednesday 27 May 2015.

The primary business of the EGM is to seek shareholder approval of the proposed acquisition of ARP TriEnergy Pty Ltd (“ TriE ”) which owns the Leigh Creek Energy Project ( “LCEP” ).

Full details are contained in the Notice of Meeting and associated explanatory material.

Attached please find the following documents which have been despatched to the Company’s shareholders today:

Notice of Extraordinary General Meeting and
Proxy Form

Also attached is a report by Australian Mineral Consultants which is a Specialist Technical Report on deep coal assets which form the LCEP held by TriE, within Petroleum Exploration Licence (PEL) 650 in South Australia.

Following release on the ASX platform, the documents will be available on the Company’s website www.marathonresources.com.au.

Yours sincerely

Sam Appleyard Company Secretary

T +61 (0)8 8348 3500 F +61 (0)8 7225 6990

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OPTION TERMS AND CONDITIONS

The TERMS AND CONDITIONS appearing below are an abridged form of the rules applying under the Marathon Resources Limited Employee Share Option Plan (as amended from time to time) ( ESOP ), a complete copy of which will be provided to an Option holder. To the extent of any inconsistency between the ESOP and the Terms and Conditions the ESOP will prevail and the Terms and Conditions modified to the extent of the inconsistency.

The Option holder is entitled on payment of the applicable exercise price for the relevant Option to be allotted one ordinary fully paid share for each Option exercised. The exercise price for the (A or B) Options are as follows:

A Options: The greater of $0.20 and 10% premium to the 5 day VWAP up to 26 May 2015 (being the day before the General Meeting); and

B Options: The great of $0.25 and 10% premium to the 5 day VWAP up to 26 May 2015 (being the day before the General Meeting),

(respectively the Exercise Price ).

Options held by the Option holder are exercisable from the First Exercise Date up to and including the Last Exercise Date for the relevant class of Options as set out below (the Exercise Period ). Reminder notices will be forwarded to the Option holder prior to the Last Exercise Date for each Option.

	First Exercise Date	Last Exercise Date
AOptions	Ongrant ofOption	4yearsfromGrant
BOptions	Ongrant ofOption	5 yearsfromGrant

Each Option that is not exercised on or before the Last Exercise Date for that Option will lapse. Unexercised Options will also lapse if the Option holder ceases to be a Director of the Company during the relevant Exercise Period for those Options unless the Option holder ceases to be a Director by reason of permanent disability, death or retirement, in which case the Option holder will have 1 month or such longer period as the Board may determine to exercise any remaining unexercised Options. Any longer period granted by the Board to exercise an Option must not exceed the relevant Last Exercise Date for that Option.
An Option is exercisable by notice in writing to the Company lodged at the office of the Company’s share registry together with payment of the Exercise Price for each Option exercised. The minimum number of Options which may be exercised at any time is a marketable parcel except where less than that number is held in which case all Options held by one holder must be exercised.
The Company will not apply for official quotation of Options on the ASX. The Company will make application for official quotation on the ASX of new shares allotted on exercise of Options. Shares allotted on exercise of Options will participate equally in all respects with existing issued ordinary shares. In particular, shares allotted on exercise of Options will qualify for dividends declared after the date of allotment.
Options carry no right (without exercising the Options) to participate in rights issues which may be offered by the Company to its shareholders after the date of issue of the Options or in bonus issues or dividends. However the Company must give prior notice to Option holders of any new issue before the record date for determining entitlements to the issue in accordance with the ASX Listing Rules and Option holders have the right to exercise the Options prior to the record date for determining entitlements.
If during the currency of the Options the issued capital of the Company is reorganised, the rights of the Option holder in respect of those Options may be varied to comply with the ASX Listing Rules which apply to the reorganisation.
If the Company makes a rights issue (other than a bonus issue), the exercise price of Options on issue will be reduced according to this formula:

A = O – E [P – (S + D)]

(N + 1)

Where:

A = the new exercise price of the Option;

O = the old exercise price of the Option;

E = the number of underlying ordinary shares into which one Option is exercisable

134

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P = the average closing sale price per ordinary share (weighted by reference to volume) recorded on the stock market of ASX during the 5 trading days ending on the day before the ex rights date or ex entitlements date (excluding special crossings and overnight sales);
S = the subscription price for an ordinary share under the pro rata issue;
D = the dividend due but not yet paid on each ordinary share at the relevant time (except those to be issued under the pro rata issue); and
N = the number of ordinary shares that must be held to entitle holders to receive a right to one new ordinary share in the pro rata issue.
If there is a bonus issue to the holders of ordinary shares in the capital of the Company, the number of ordinary shares over which the Option is exercisable will be increased by the number of ordinary shares which the holder of the Option would have received if the Option had been exercised before the record date for the bonus issue.
Options may, with the prior approval of the Board, be transferred at any time prior to their expiry by completing a standard form of transfer.
Option holders appearing on the Company’s Register of Option holders at the relevant date will be entitled to receive and will be sent all reports and accounts required to be laid before shareholders in general meetings and all notices of general meetings and will have the right to attend but shall have no right to vote at such meetings.

Lodge your vote:

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----- Start of picture text -----

 Online:
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www.investorvote.com.au

By Mail:

Computershare Investor Services Pty Limited GPO Box 242 Melbourne Victoria 3001 Australia

Alternatively you can fax your form to (within Australia) 1800 783 447 (outside Australia) +61 3 9473 2555

For Intermediary Online subscribers only (custodians) www.intermediaryonline.com

For all enquiries call:

(within Australia) 1300 556 161 (outside Australia) +61 3 9415 4000

Proxy Form

Vote online



Go to www.investorvote.com.au or scan the QR Code with your mobile device.
Follow the instructions on the secure website to vote.

Your access information that you will need to vote:

PLEASE NOTE: For security reasons it is important that you keep your SRN/HIN confidential.

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 For your vote to be effective it must be received by 9:30am (Adelaide time) Monday 25 May 2015

How to Vote on Items of Business

All your securities will be voted in accordance with your directions.

Appointment of Proxy

Voting 100% of your holding: Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote or abstain as they choose (to the extent permitted by law). If you mark more than one box on an item your vote will be invalid on that item.

Voting a portion of your holding: Indicate a portion of your voting rights by inserting the percentage or number of securities you wish to vote in the For, Against or Abstain box or boxes. The sum of the votes cast must not exceed your voting entitlement or 100%.

Appointing a second proxy: You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities for each in Step 1 overleaf.

A proxy need not be a securityholder of the Company.

Signing Instructions for Postal Forms

Individual: Where the holding is in one name, the securityholder must sign.

Joint Holding: Where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: If you have not already lodged the Power of Attorney with the registry, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please sign in the appropriate place to indicate the office held. Delete titles as applicable.

Attending the Meeting

Bring this form to assist registration. If a representative of a corporate securityholder or proxy is to attend the meeting you will need to provide the appropriate “Certificate of Appointment of Corporate Representative” prior to admission. A form of the certificate may be obtained from Computershare or online at www.investorcentre.com under the help tab, "Printable Forms".

Comments & Questions: If you have any comments or questions for the company, please write them on a separate sheet of paper and return with this form.

GO ONLINE TO VOTE,  or turn over to complete the form

196785_Live_Samples/000009/000018/i

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Change of address. If incorrect, mark this box and make the correction in the space to the left. Securityholders sponsored by a broker (reference number commences with ’ X ’) should advise your broker of any changes.

Proxy Form

Please mark to indicate your directions

Appoint a Proxy to Vote on Your Behalf

I/We being a member/s of Marathon Resources Limited hereby appoint

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the Chairman of the Meeting

 PLEASE NOTE: Leave this box blank if OR you have selected the Chairman of the Meeting. Do not insert your own name(s).

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the Meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the General Meeting of Marathon Resources Limited to be held at the offices of Marathon Resources Limited, Unit 8/53-57 Glen Osmond Road, Eastwood SA 5063 on Wednesday, 27 May 2015 at 9:30am (Adelaide time) and at any adjournment or postponement of that Meeting.

Chairman authorised to exercise undirected proxies on remuneration related resolutions : Where I/we have appointed the Chairman of the Meeting as my/our proxy (or the Chairman becomes my/our proxy by default), I/we expressly authorise the Chairman to exercise my/our proxy on Item 7 (except where I/we have indicated a different voting intention below) even though Item 7 is connected directly or indirectly with the remuneration of a member of key management personnel, which includes the Chairman.

Important Note: If the Chairman of the Meeting is (or becomes) your proxy you can direct the Chairman to vote for or against or abstain from voting on Item 7 by marking the appropriate box in step 2 below.

Items of Business  PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

1 Change to Nature and Scale of the Company's Activities
2 Acquisition of ARP TriEnergy
3 Royalty Deed
4 Appointment of Mr Daniel J D Peters as Director
5 Appointment of Mr David Kit Shearwood as Director
6 Interim Funding of ARP TriEnergy
7 Grant of Options to Cluan Capital Management Pty Ltd as nominee for Mr Peter L Williams

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The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business. In exceptional circumstances, the Chairman of the Meeting may change his/her voting intention on any resolution, in which case an ASX announcement will be made.

SIGN

Signature of Securityholder(s) This section must be completed.

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Individual or Securityholder 1 Securityholder 2 Securityholder 3
Sole Director and Sole Company Secretary Director Director/Company Secretary
Contact
Contact Daytime / /
Name Telephone Date
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M T N

1 9 6 7 8 5 A

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Marathon Resources Limited Unit 8, 53-57 Glen Osmond Road Eastwood SA 5063 AUSTRALIA

REVIEW REPORT ARP TriEnergy Pty Ltd LEIGH CREEK ENERGY PROJECT PEL 650 South Australia

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Australian Mineral Consultants (AMC)

A: 23 Bridge St Kensington SA 5068 P: (08) 8132 9105 ABN: 85 989 040 917

20 JAN 2015

REVIEW REPORT LCEP PEL 650

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|||
|---|---|
|Summary ................................................................................................................................................................. 4|
|1.0. Scope ................................................................................................................................................................ 6|
|1.1. Description and Location of Leigh Creek Energy Project ............................................................................ 6|
|1.2. Topography and Climate ............................................................................................................................. 9|
|1.3. History of Leigh Creek Coal ....................................................................................................................... 10|
|1.4. Current Operating Legislation ................................................................................................................... 11|
|2.0. Geological Setting for the LCEP ...................................................................................................................... 11|
|2.1. Geological Setting ..................................................................................................................................... 11|
|2.2. Sedimentology .......................................................................................................................................... 14|
|2.2.1. 'Hardbars': Siderite Rich Siltstone ....................................................................................................... 17|
|2.3. Stratigraphy ................................................................................................................................................ 18|
|2.3.1. Lower Series Coal (LC) ......................................................................................................................... 20|
|2.3.2. Lower Series Overburden (LO) ............................................................................................................ 20|
|2.3.3. Main Series Coal (MC) ......................................................................................................................... 20|
|2.3.4. Main Series Overburden (MO) ............................................................................................................ 20|
|2.3.5. Upper Series Coals (UC) ...................................................................................................................... 21|
|2.3.6. Upper Series Overburden (UO) ........................................................................................................... 21|
|2.3.7. Quaternary Surface Cover (QSC) ......................................................................................................... 21|
|2.4. Structure .................................................................................................................................................... 22|
|3.0. In-Situ Coal Gasification (ISG) ........................................................................................................................ 25|
|3.1. ISG Background .......................................................................................................................................... 25|
|3.2. Well Characteristics and Flow Path Enhancement .................................................................................... 25|
|3.3. Injection Process (CRIP) ............................................................................................................................. 26|
|3.4. Surface Facilities ......................................................................................................................................... 27|
|3.4.1. Removal of Particulates and Tars ........................................................................................................ 28|
|3.4.2. Removal of Sulphur Compounds, Such as H2S and COS ...................................................................... 28|
|3.4.3. Removal of Mercury and Other Volatile Metals ................................................................................. 28|
|3.4.4. Auxiliary Surface Facilities ................................................................................................................... 28|
|3.5. Site Selection .............................................................................................................................................. 29|
|3.5.1. Existing Information on Site Selection ................................................................................................ 31|
|“exploring & producing safely”|PAGE 1|

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REVIEW REPORT LCEP PEL 650

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3.5.2. Field Programme Results .................................................................................................................... 33 3.5.3. Materials Testing ................................................................................................................................. 35 3.5.4. Permeability Test Data ........................................................................................................................ 36 3.5.5. Coal Seam Characteristics ................................................................................................................... 36 3.6. Technical Analysis of Gasification .............................................................................................................. 37 3.6.1. Groundwater Analysis ......................................................................................................................... 37 3.6.2. Roof Stability ....................................................................................................................................... 38 3.6.3. Implications of Gasification Process ................................................................................................... 39 3.6.4. Overview of Lobe B Coal Seams .......................................................................................................... 40 3.6.5. Coal to Gas Conversion Ratio .............................................................................................................. 42 4.0. Planned AppraisalDrilling ............................................................................................................................... 44 4.1. Scope of Planned Work Programme .......................................................................................................... 45 4.2. Appraisal Drilling Expenditure.................................................................................................................... 46 5.0. Conclusions .................................................................................................................................................... 48 6.0. Recommendations ......................................................................................................................................... 50 7.0. References...................................................................................................................................................... 51 7.1. Geological ................................................................................................................................................... 51 7.2. In-Situ Gasification (ISG) ............................................................................................................................ 53 7.3. Geotechnical Reports: Telford Basin, Lobe B, Leigh Creek ........................................................................ 55 Appendix 1. ........................................................................................................................................................... 57 ARP TriEnergy Pty Ltd ........................................................................................................................................ 57 Legislation Governing the Mining and Petroleum Operations at Leigh Creek ................................................. 57 Appendix 2. ........................................................................................................................................................... 62 Geological Log ................................................................................................................................................... 62 Appendix 3. ........................................................................................................................................................... 69 JORC 2012 Table 1 ............................................................................................................................................. 69 JORC Code, 2012 Edition – Table 1 ....................................................................................................................... 70 Appendix 4. ........................................................................................................................................................... 74 Tenement licence Status Report ....................................................................................................................... 74

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REVIEW REPORT LCEP PEL 650

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Statement of Risk

The accuracy of reserves and economic evaluations is always subject to uncertainty. The magnitude of this uncertainty is generally proportional to the quantity and quality of data available for analysis. As a project matures and new information becomes available, revisions may be required which may either increase or decrease the previous reserve assignments. Sometimes these revisions may result not only in a significant change to the reserves and value assigned to a property, but also may impact the total company reserve and economic status. The reserves estimates contained in this report were based upon a technical analysis of the available data using accepted engineering principles. However, they must be accepted with the understanding that further information and future performance subsequent to the date of the estimate may justify their revision. It is AMC’s opinion that the estimated resources and other reserve information as specified in this report are reasonable, and have been prepared in accordance with generally accepted geological engineering and evaluation principles. Notwithstanding the aforementioned opinion, AMC makes no warranties concerning the data and interpretations of such data. In no event shall AMC be liable for any special or consequential damages arising from Marathon Resources use of AMC’s interpretation, reports, or services produced as a result of its work for Marathon Resources.

Neither AMC, nor any of our employees have any interest in the subject properties and neither the employment to do this work, nor the compensation, is contingent on our estimates of reserves for the properties in this report.

Competent Persons Statement

The Information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Tim Jones, a Competent Person who is a Member of the Australian Institute of Geoscientist. Tim Jones is employed by Australian Mineral Consultants. Tim Jones has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the “Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Tim Jones consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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REVIEW REPORT LCEP PEL 650

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Summary

Australian Mineral Consultants was instructed by Marathon Resources Limited (Marathon), an Australian listed company (ASX code MTN), to prepare a Specialist Technical Report on deep coal assets which form the Leigh Creek Energy Project (LCEP) held by ARP TriEnergy Pty Ltd within Petroleum Exploration Licence (PEL 650), South Australia.

Australian Mineral Consultants understands that Marathon will use this Specialist Technical Report in relation to a proposed merger with ARP TriEnergy Pty Ltd.

Various feasibility studies have been undertaken for the suitability of In-Situ Gasification (ISG) at Leigh Creek for gas feedstock to power generation. The studies focused upon site selection with field components providing quantitative data on the strength and permeability characteristics of the geological profile of the Main Series coal seam in Lobe B. The principal concerns for development of a gasified system relate to the potential drawdown of the water table, and resulting groundwater inflow into the burn cavity, and the stability of roof rocks as the cavity expands.

These studies concluded that ISG was feasible, but did not fully identify the extent of the coal available nor their gas potential.

This report provides a historical review of mining and datasets, hydrogeology, geotechnical assessment along with structural and resource geology of the site and its compatibility for ISG. A costed exploration plan will seek to prove up an[] exploration target range of 130 million to 400 million TTIS (Total Tonnes In Situ) within the main seam and an additional 90 million to 130 million TTIS within the Lower Series coal seam is provided. Combining the main seam and Lower Series coal seam together obtains a range of 220 million to 530 million TTIS* (Total Tonnes in Situ).

* The potential coal quantity is conceptual in nature as there has been insufficient exploration to date to define a Coal Resource and it is uncertain if further exploration will result in the determination of a Coal Resource

The coal currently mined from Lobe B at Leigh Creek exhibits the following specifications;

moisture 18% to 31%;
• ash 7% to 13%; • volatile matter 21% to 33%; • fixed carbon 30% to 35%; • total sulphur 0.5% to 0.7%; • calorific value around 3,600 to 5,400 kcal/kg.

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REVIEW REPORT LCEP PEL 650

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The coal quality of the Lobe B Leigh Creek coal is similar to the two previous successful ISG trials completed by Carbon Energy Pty Ltd and Linc Energy Pty Ltd in Queensland. The two important parameters for ISG in those trials being moisture (14%) and volatile matter (33%) match Leigh Creek coal.

Utilising a coal to gas conversion formula of 14Gj/t, see Section 3.6.5, an estimate of gas-in-place volumes at the Leigh Creek Energy Project could range from 33,000 MMm[3] to 102,000 MMm[3] for the Main seam with a further 23,000 MMm[3] to 33,000 MMm[3] for the lower seam. The combined total gas-in-place could range from 56,000 MMm[3] to 135,000 MMm[3] . It is important to recognize that these are potential volumes of gas-in-place and do not represent sales gas volumes.

Based on the available information, data, pilot project studies undertaken in Queensland and examples of projects that have produced syngas from coal deposits, AMC has concluded that the production of syngas utilising the ISG technology is feasible and that the remaining coal seams at Leigh Creek Lobe B may represent a potential source for the production of syngas. In order to evaluate the potential to produce syngas from these coal seams we recommend that Marathon continue it’s planning and approval processes for an ISG stage 1 operation (single generator) at Leigh Creek.

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REVIEW REPORT LCEP PEL 650

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1.0. Scope

Marathon Resources Limited (MTN) engaged Australian Mineral Consultants to provide an independent review of the proposed Leigh Creek Energy Project (LCEP) within Petroleum Exploration Lease (PEL 650) held by ARP TriEnergy Pty Ltd. The Scope of review was to include:

Historical Review of Mining and Datasets;
Review Geology, Hydrogeology and Structure;
Compatibility for ISG;
Exploration; and
Resource Modelling and Estimation.

1.1. Description and Location of Leigh Creek Energy Project

ARP TriEnergy Pty Ltd currently has one granted PEL, five PEL’s and two EL’s under application, Table 1, Figure 1. They are; PEL650, PELA643, PELA582, PEL644, PELA649, PELA647, ELA232 and ELA238. These licences are to be included in the merger with Marathon and will remain in ARP Tri Energy’s name which in turn will become a wholly owned subsidiary of Marathon. In accordance to the VALMIN code clause 67 a detailed status table for each licence is in Appendix 4. The tenements to be included in the merger are;

Table 1. ARP TriEnergy Tenements

TENEMENT	LOCATION	SURFACE AREA (sq km)	SURFACE AREA (ha)	MINERAL RIGHTS HOLDER	STATUS OF MINERAL RIGHT
PEL 650	LEIGH CREEK	93.4	9340	ARP Tri- Energy Pty Ltd 100%	Granted 18 November 2014
ELA 232	LEIGH CREEK	942	94200	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
ELA 238	LEIGH CREEK	351	35100	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
PELA 643	CALLABONNA	5,813.49	581,349	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
PELA 582	FINNISS SPRINGS	5,677.12	567,712	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
PELA 647	LEIGH CREEK	3,841.86	384,186	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
PELA 644	ROXBY DOWNS	8,932.98	893,298	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
PELA 649	OAKDALE	2,309.78	230,978	ARP Tri- Energy Pty Ltd 100%	Under application awaiting grant
TOTAL		27,961.63	2,796,163

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Figure 1. ARP TriEnergy Pty Ltd PELA’s

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PELA 582 was originally applied for in October 2011 by Nicavid Consulting and Design Pty Ltd, which was acquired by ARP in January 2012 in a ‘friendly’ related party transaction. Nicavid subsequently changed its company name on the 22 February 2012 to ARP TriEnergy Pty Ltd. On 28 May 2014 the size of PELA 582 was increased almost 8 fold from 1,137km2 to 8,688km2, to the west and north up to the Arckaringa Basin. On the 4 September 2014 this PELA was divided to make up PELA 582 (NW portion) and PELA 647 (E portion). The LCEP was within PELA 647 prior to the granting of PEL 650.

The remaining PELA 582 is situated to the north of PELA 647 and its northern extent is in the Arckaringa Basin, which has the potential for shale oil plays. The southern area of PELA 582 is in the Arrowie Basin, which has the potential for shale gas plays and the possibility of deep coal.

The ground is located over the Arrowie Basin, which shares the same geology as PELA 582 and PELA 647 and has the prospect of deep coal.

PELA 644 was acquired because of its proximity to PELA 582 Olympic Dam and Prominent Hill. The ground is located over the Arrowie Basin, which shares the same geology as PELA 582 and PELA 647, and has the prospect of deep coal.

PELA 643 is located on the southern extent of the Cooper basin, with the prospect of deep Permian Coal extending south from the Cooper.

PELA 649 is located over the southern extent of the Polda Basin on the Eyre Peninsula. The Polda Basin is known to contain deep coal in the Lock coal deposit. This PELA was acquired for because of the possibility of the deep coal extending further to the south.

ELA 232 and 238 are located to the north of the Leigh Creek Coalfield. The EL’s have exploration potential to expand the current resource of coal. Analysis of magnetic and gravity data against drilling data has highlighted exploration targets to the south of Farina.

This report focuses upon ARP Tri Energy’s Leigh Creek Energy Project within PEL 650 which encompasses the Leigh Creek coal mine and its’ deeper coal potential for “In Situ Gasification” (ISG) below the life of mine economic 200m open cut level. An exploration target range has been determined from analysis of drill hole data held on the South Australian Resources Information Geoserver (SARIG). Over 1000 drill exploration holes have been completed in and around the open cut mine since its operation. Planned appraisal drilling will provide deep coal seam data for a JORC compliant resource which in turn can be converted into an estimated in-situ gas volume.

The Leigh Creek open cut mine is located about 560km north of Adelaide. It produces a low grade black coal and is part of Alinta Energy’s Flinders Operations division. Coal occurs within five small discrete basins spread over 20 km which make up the Coalfield. These five basins are the remnants of a broader sedimentary sequence containing Late Triassic age coal seams (220 million years). A full description of coal resources is presented in Section 2.

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Leigh Creek is responsible for supplying coal exclusively to Alinta Energy’s Port Augusta power stations. The mine produces approximately 1.5 to 2.5 Million tonnes per annum. The coal is transported 250km south by train to Port Augusta. The train service is provided under contract by Pacific National.

1.2. Topography and Climate

The Leigh Creek area is relatively flat and is situated between Lake Torrens (salt lake) 40km to the west and the Flinders Ranges to the southeast. The environment is arid with ephemeral creeks (only flow during rain events), which run westwards. The surrounding land has few tall trees and is only suitable for low-density grazing, on native scrub. The Aroona Dam located south west of the Leigh Creek township captures storm runoff for drinking water and other potable water needs of the town. Located between the township of Leigh Creek and the coal mine is the township of Copley. The coalmine has large areas of land covered in waste dumps from the removal of overburden.

Climate data for Leigh Creek, Table 2 shows summer temperatures ranging low to mid 30’s with recorded highs above 40 Celsius between October and March. Minimum average temperatures during winter are between 17 and 19 degrees Celsius, however recorded lows of below zero temperatures occur between May and August. Rainfall is considered sporadic and relatively evenly spread on a monthly basis, normally a result of isolated thunder storms rather than wide spread frontal systems. The average precipitation for a year is 49.7 days for a total annual rainfall of 228.5mm.

Table 2 - Climate data for Leigh Creek Airport

Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	Year
46.3	45.4	41.5	37.3	30.3	27.7	26.3	32.0	37.7	41.1	45.2	45.4	46.3
(115.3)	(113.7)	(106.7)	(99.1)	(86.5)	(81.9)	(79.3)	(89.6)	(99.9)	(106)	(113.4)	(113.7)	(115.3)
35.5	34.5	31.1	26.2	20.9	17.0	16.6	19.1	23.2	26.7	30.5	33.0	26.2
(95.9)	(94.1)	(88)	(79.2)	(69.6)	(62.6)	(61.9)	(66.4)	(73.8)	(80.1)	(86.9)	(91.4)	(79.2)
20.7	20.4	17.3	12.9	8.7	5.4	4.7	6.1	9.3	12.4	16.1	18.6	12.7
(69.3)	(68.7)	(63.1)	(55.2)	(47.7)	(41.7)	(40.5)	(43)	(48.7)	(54.3)	(61)	(65.5)	(54.9)
11.0	10.5	6.7	2.2	−0.7	−1.7	−2.4	−1.2	0.9	2.5	6.1	8.6	−2.4
(51.8)	(50.9)	(44.1)	(36)	(30.7)	(28.9)	(27.7)	(29.8)	(33.6)	(36.5)	(43)	(47.5)	(27.7)
20.2	28.7	20.3	13.1	16.1	17.2	17.4	15.6	18.3	18.6	19.0	24.2	228.5
(0.795)	(1.13)	(0.799)	(0.516)	(0.634)	(0.677)	(0.685)	(0.614)	(0.72)	(0.732)	(0.748)	(0.953)	(8.996)

3.4	3.0	2.7	2.6	4.0	5.1	6.6	4.8	4.8	4.4	4.7	4.1	49.7

Source: Wikipedia and Bureau of Meteorology 2014

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1.3. History of Leigh Creek Coal

John Henry Reid discovered coal-bearing shale in 1888 during the sinking of a railway dam in the Leigh Creek area (Henry Brown, Government Geologist confirmed the find in his visit to Leigh's Creek in February 1889 - Rob C Wilton, Manager, NRG Flinders). This discovery led to a geological examination of the area by a government geologist and the establishment of underground workings. No 1 shaft, sunk by the Leigh Creek Coal Mining Company, was abandoned on striking a heavy flow of water. A new shaft was sunk in 1892 but only small quantities of coal were extracted for experimental purposes and operations ceased in 1894.

It was not until 1940 when coal supplies became critically low because of the Second World War that Leigh Creek coal was considered again. The deposits seemed extensive and extracting the coal by open cut methods was considered feasible. Exploratory boring started in 1941 and plans were made to develop the first open cut mine. Excavation started in 1943 under the control of the Engineering & Water Supply Department. It was apparent that the electricity supply industry would be the largest user of Leigh Creek coal so control of the coalfield was transferred to the Electricity Trust of South Australia (ETSA) in 1948.

ETSA ordered boilers capable of burning Leigh Creek coal for the Osborne Power Station near Port Adelaide and, after thorough investigations, decided to establish a new power station at Port Augusta to burn Leigh Creek coal exclusively. The combined A and B plants, with a total generating capacity of 330 megawatts, was named the Thomas Playford Station in recognition of the then South Australian Premier, Sir Thomas Playford.

In the mid 1970s it was decided to build a 500 megawatt station at Port Augusta, called the Northern Power Station. That decision meant enlarging the coalfield using new methods to extract deeper coal, increasing production, building a retention dam to prevent possible flooding of the field and diverting the main highway around the coalfield. The Northern Power Station, alongside Playford A and B, was commissioned in 1985. Because the existing town was located within the coal basin, a new Leigh Creek town was built south of the coalfield, becoming occupied in 1980.

The use of large excavating machines and efficient mining equipment at Leigh Creek, together with the rebuilding of a railway line between Leigh Creek and Port Augusta by the Commonwealth Railways (later Australian National, now Pacific National), resulted in economic production and delivery of coal to the power station. Pacific National currently provides the coal freight service to Flinders Power.

After ETSA was privatised in 1999, the power stations changed hands several times. They became affiliated with Alinta Energy in 2007 when former owners, Babcock & Brown Power, acquired Alinta. The name officially changed in 2010. The coalfield at Leigh Creek currently produces approximately 1.5 to 2.0 million tonnes a year of coal which is entirely consumed by the power stations at Port Augusta which produce up to 40 per cent of the electricity generated in South Australia.

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1.4. Current Operating Legislation

The Leigh Creek mine was established in 1946 under a Crown Agreement issued by the South Australian Government to the then ETSA, rather than under a conventional Mining Lease issued under the Mining Act. That Special Agreement covering the mine development stipulated that a production royalty would be paid to the State of South Australia at a rate of one shilling per ton.

The royalty remained at a low rate for a number of decades, but as ETSA was a State Government-owned entity, there was little incentive to amend the rate. By June 1981 when it was clear that the historic low fixed rate no longer produced an adequate return to the community, ETSA and the State Government mutually agreed to assess the royalty liability on production from Leigh Creek “as if the royalty provisions in the Mining Act, in fact, applied”. From July 1981 until the end of June 1988, royalty payable by the Leigh Creek mine on coal was assessed at a rate of 2.5% of value of production, which equated to forty cents per tonne.

Alinta are operating within an exemption from the Mining Act 1971. ARP TriEnergy will be operating under the Petroleum and Geothermal Energy Act 2000 and has a Petroleum Exploration Licence Application, PELA 647 that extends over the entire Leigh Creek coal area and surrounds PEL 650. ARP TriEnergy Pty Ltd’s explanation governing legislation is presented in Appendix 1.

2.0. Geological Setting for the LCEP

Five small discrete basins spread over 20 km make up the Leigh Creek Coalfield, Figure 2. The main basins are known as Copley Basin, Telford Basin, Lobe C and Lobe D. These are remnants of a broader sedimentary sequence containing Late Triassic age coal seams (220 million years). In the early to mid 1980’s the University of Adelaide, Department of Mines SA, Electricity Trust SA, Golder Associates et al completed investigations into the viability of In Situ Gasification (ISG) within the main and lower seams of the Telford Basin Lobe B.

Lobe B is the largest of the areas currently being mined to an economic cut off of 200m utilising open cut methods. A significant resource below that level has been determined to be feasible for ISG. ARP TriEnergy is currently going through the permitting stages to obtain approval for an ISG stage 1 (single generator) production.

2.1. Geological Setting

The geological setting, sedimentology and stratigraphy is best described by Murray-Wallace (1983). He said accumulation of the Leigh Creek coal measures occurred within a relatively shallow intramontane basin during the Upper Triassic (Parkin 1953, Johns 1973, Townsend 1975). According to Johns (1973) the separate lobes may represent remnants of a more ubiquitous sedimentary sequence deposited in a freshwater fluvio-lacustrine environment.

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Evidence for a freshwater depositional environment is supported by the presence of Unio eyrensis, a freshwater mussel occurring in some of the more lithified, ferruginous-rich sandy-shale beds within the Lower Series overburden. Leighiscus hillsi, a comparatively rare species of fish, is also documented to occur within these sediments (Coats, 1973). Preliminary analysis of plant spores (Playford and Dettmann, 1965) has delimited an Upper Triassic age (Rhaetic) for the basin sediments, although later work (Hos, 1977, 1978) showed that the uppermost part may be Jurassic.

The Triass-Jurassic sequence is preserved within folded Adelaidean rocks resulting from a predominantly brittle deformational event. This comparatively localized example of brittle with associated ductile deformation is likely to have occurred during Early Jurassic times. This is elaborated in further in Section 2.4.

Adelaidean sediments locally representing basement to the unconformably overlying Triassic sequence were deposited within the Adelaide 'Geosyncline'.

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Figure 2: Coal Basins of the Leigh Creek Region

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2.2. Sedimentology

Deposition of the Triass-Jurassic sequence in Telford Basin occurred under freshwater conditions within an intramontane basin. The presence of the coal seams and Unio eyrensis indicates that the region was non-marine.

During Upper Triassic times the basin was a fluvio-lacustrine environment (Parkin, 1953; Johns, 1972, 1973; Johns and Townsend, 1975; Townsend, 1978). In this environment meandering streams flowed across broad swampy floodplains which from time to time were the sites of temporary shallow lakes. The shifting of the stream (and hence deposition and erosion by the stream) across the floodplain, adds to the complexity of lithofacies distribution. Thus a clear understanding of the sedimentary features that characterize this type of complex environment is invaluable in establishing the feasibility for ISG.

One approach to developing an understanding of the sedimentary environment is to consider it in the context of a geological model. Geological models are "idealized simplifications set up to aid our understanding of complex natural phenomena and processes" (Reading (ed.). 1978 p. 9). A model describing a fluvio-lacustrine environment should be able to account for its variability, and to be equally well applied to a similar depositional environment elsewhere.

In connection with lacustrine environments, however, it should be stressed that such descriptions at best are generalizations. This is due to the highly variable character of the resultant deposits and because contemporary research on ancient lake sediments is in its infancy.

In fluvio-lacustrine environments coal forms in the poorly drained swamps and shallow lakes occurring on the floodplains bordering the river (Figure 2).

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Figure 2. Typical Palaeo-Channel Illustrating Patterns of Sedimentation and Coal Formation

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Proximal sands occur within the meander belt preserved as overbank deposits and crevasse splays and above the basal conglomerate of the point bar deposits. Crevasse splays develop when coarser channel sediment is introduced to the floodplain by rupture (crevassing) of a levee during flood. These deposits form fans or tongues of sand elongated away from a crevasse cut in the river levee. The sands thin distally from the crevasse and have cross-lamination directions divergent from the adjacent channel sands. All the courser sediments can later give rise to aquifers. In contrast, silts and clays deposited beyond the crevasse splays may eventually transgress the swamps producing confining materials to the underlying coals.

The meander belt shifts its position on the flood plain through time, thus eventually leading to a complex suite of sediments that are highly variable both laterally and vertically. In humid settings the floodplain may never fully dry out and remain a back swamp or even a lake. Under these conditions vegetation dominates the flood plain and leads to the development of peats.

Given time, heat and pressure, the peats will be transformed to coal. This change is not sudden and involves some tens of millions of years. Coal, an organic substance primarily containing carbon and “exploring & producing safely” PAGE 15

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varying proportions of hydrogen, oxygen, nitrogen and sulphur, represents the fossilized remains of land vegetation.

The first stage of coalification is the formation of peat. This forms as a result of the compression and gradual decomposition of vegetative material, under additional layers of plant life. This change is represented by;

6C6H10O5	=	7C02	+	3CH4 +	14H20	+	C26H20O2
(cellulose)				(methane)			(peat)

Peat, the most primitive form of coal, contains approximately 90 percent water and decayed plant material.

The quality and usefulness of coal is largely determined by the pressure and heat exerted upon it. Thus neither the age nor the depth of a coal necessarily indicates its rank in terms of utility. As the higher the proportion of carbon to moisture in coal determines its heat value, a coal that has experienced greatest compression and condensation is ranked the highest. The various grades of coal listed in order of increasing rank include lignite, sub-bituminous, bituminous and anthracite.

The implications to ISG of such a model include:

in any one stratum, permeability is highest near the palaeochannel (point bar and levee bank) deposits and decreases away from these;
thinnest coal is found in the palaeochannel area and separated from permeable aquifers by strata having poor confinement. Water ingress in this zone has a high probability of being detrimental to successful ISG; and
further away from the palaeochannels, the coal thickens and the confining sediments exhibit progressively lower permeability. Here water influx problems are minimized due to more effective confinement and isolation of coal seams and thus the surrounding materials are less capable of transmitting significant quantities of water or product gas. This is the most favourable site for ISG.

The majority of sediments in Telford Basin are finely laminated but appear massive (non-bedded) in outcrop. The relatively undisturbed nature of these sediments and the presence of clam shells and fish skeletons, indicates they were deposited below wave base, in shallow lakes, on floodplains that were regularly inundated with water. The relatively thick bedded and laterally persistent coal measures lend support to this contention. Occasional thin lenses of symmetrically ripple marked medium-fine grained sandstones occurring in the Main Series overburden, however, and polygonal mudcracks and gypsum in hardbars indicates shallowing in water depth with episodic exposure to subaerial conditions. Since the majority of the sediments are massive and laterally persistent, the problems resulting from rapid lensing or facies changes would not likely arise during ISG at Leigh Creek.

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Although the origin of the sediments is not entirely clear, Townsend (1978, pers, comm., 1983) suggests that a likely provenance for the sequence in Telford Basin is from the southwest, where Adelaidean sediments formerly provided the higher relief. This contention is based on the thinning of sandstones distally from the suggested source area. Proximal sands are suggested to be represented by thicker units.

It should be pointed out, however, that during Upper Triassic times, higher relief also occurred to the northwest and this could equally represent a source area. This would be expected as the Telford Basin is suggested to represent an intramontane basin. Moreover thinning of sands distally does not provide compelling evidence for a source area. Furthermore, the argument is circular as Cainozoic denudation has removed most of the sedimentary evidence upon which confident understanding of provenance may be based.

2.2.1. 'Hardbars': Siderite Rich Siltstone

'Hardbar' is a generic term used locally to describe any lithology intercepted during drilling or in mine faces that are significantly harder than adjacent strata. The hardbars observed in the Telford Basin assume a variety of habits and their formation remains problematic.

Within the Lower Series overburden hardbars crop out as concretionary nodules, and continue along strike over considerable distances (> 1 km). Marked variability in the size of concretions is apparent with the largest observed attaining the dimensions of 1400 x 700 x 350 mm. The majority of the concretions however, are smaller with long axes in the order of 150 - 250 mm. The hardbars predominantly occur in discrete layers regularly intercalated with shales and occasional sands within the Lower and Main series overburden.

In the southern portion of the Telford Basin the concretionary nodules crop out at regular intervals (every 2- 4 m). Their resistance to denudation has resulted in the higher relief in parts of the basin, as evidenced by the hogbacks and cuestas they form.

Exposed at depth within the mining pits of the Main Series overburden, the hardbars are massive. Here they assume a characteristic rectangular shape and contain fine grained pyrite (iron sulphide) and siderite (iron oxide) within a silty matrix.

Coffey et al. (1978) suggest that the hardbars represent palaeosols, but a two-stage mechanism involving the interaction of primary sedimentary features with epidiagenetic activity is preferred. In this context subsurface initiation of weathering within a vadose zone can account for the concretionary features. The concretions are likely to form by similar processes responsible for spheroidally weathered granite tors.

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The first stage in their formation involves the initiation of weathering along joints, resulting in the transition from an essentially rectangular to a spheroidal shape. The second stage involves their exposure to subaerial conditions by denudation. Although this is termed a two stage process, in reality the processes occur concurrently.

Although concern is later expressed regarding the competence of the overburden lithologies, the 'hardbars' may counteract this problem. This will be largely dependent however, on the lateral persistence of hardbars.

2.3. Stratigraphy

The general stratigraphy of the Telford Basin is outlined by Parkin (1953), Playford and Dettmann (1965), Johns (1972, 1973), Johns and Townsend (1975), Townsend (1978), Coffey (1978) and Kwitko et al. (1995), Figure 3.

The Triassic sequence unconformably overlies Precambrian siltstones and limestones. These were deposited during Adelaidean times within the Adelaide Geosyncline, and represent the Umberatana Group (Figure 3). This represents basement to the Triassic sequence and is usually encountered in the deeper boreholes.

The upper part of the folded basement siltstones and limestones are strongly weathered. The depth to the weathering front ranges between 10 and 30 metres below the unconformity surface (Coffey et al. 1978). The siltstones display a pronounced fissility and have a characteristic pale grey-green colour, and consist predominantly of silt-sized particles. However, numerous sand-sized particles with occasional well lithified nodules of silica or dolomite occur within the sequence.

The limestones are generally grey, laminated and contain silt-sized impurities. Below the weathering front the samples tested by Coffey have high strength ranges.

Resting directly above the unconformity is a succession of shales and mudstones followed by the Lower Series Coal seam (LC).

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Figure 3. Stratigraphy of the Leigh Creek Region (after G. Kwitco 2014)

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2.3.1. Lower Series Coal (LC)

This unit comprises a succession of thin coal seams (up to 8 m individual thickness) intercalated with carbonaceous shales, and separated by beds and mudstone. Siltstone as well as occasional lenses of sandstone frequently interdigitate. Numerous 'hardbars' occur within this unit.

2.3.2. Lower Series Overburden (LO)

Overlying the Lower Series is a succession of dark grey to black mudstones and siltstones, containing a persistent sequence of 'hardbars'. These shales and siltstones are slightly more fissile than those in the Main and Upper Series overburden. This enables the rock to cleave, revealing a variety of flora and fauna viz., broad leaf plants including Classopteris sp., Dicroidium sp. and freshwater mussels Unio eyrenis. Rare fish Leighiscus hi11si has also been identified in LO (Playford and Dettmann, 1965).

2.3.3. Main Series Coal (MC)

The Main Series generally consist of a thick seam of coal and carbonaceous shale with minor shale partings. Coal seam thickness varies from 6 to 18 m. No hardbars are identified in this unit.

Seams may not be laterally persistent due to minor faulting post dating deposition, growth faulting and occasional facies changes. Moreover, as demonstrated by the 1978 drilling, the Main Seam frequently splits into two or more beds separated by mudstone, siltstone and carbonaceous shale partings. These partings where they exist tend to be minor and would not affect ISG of the Main Series.

2.3.4. Main Series Overburden (MO)

Resting above the Main Series Coal is a succession of dark grey mudstones and siltstones, characterized by lenses of rectangular shaped massive hardbars containing finely disseminated pyrite and its weathering products haematite and limonite as well as siderite. They are ubiquitous and frequently lens out. Sometimes they resemble boudinage structures. Their average thickness is in the order of 150 - 200 mm.

Thin (200 x 2,000 mm) lenses of symmetrically ripple marked fine-medium grained sandstones are identified in the Main Series overburden. This, in association with polygonally mudcracked 'hardbars' (G. Kwitko pers. comm., 1983), suggests subaqueous - subaerial deposition, and lends support to the notion of a fluvio-lacustrine environment. Gypsum within some of the hardbars indicates episodic exposure to subaerial conditions.

In the northern half of the basin the Main Series overburden attains a thickness of approximately 600 metres. Progressive thinning however, occurs and overburden thickness of only 120 m is observed on the southern limb of the basin. This characterises the asymmetry of the basin.

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2.3.5. Upper Series Coals (UC)

Next in the succession are the Upper Series Coals with basal clays.

The Upper Series coal measures consist of 25 m of coal in approximately 10 seams in 80 m of carbonaceous mudstones and siltstones, which are essentially free of hardbars. Although these coals were considered unfaulted, recent work (K. Slee pers comm., 1983) suggests that low angle thrust faults parallel to bedding may be present. According to Coffey et al. (1978) defect spacing is wide to extremely wide. The most common defects are bedding plane joints.

2.3.6. Upper Series Overburden (UO)

Resting directly above the Upper Series coals is a sequence of poorly lithified sandstones interbedded with siltstones. The sandstones are sufficiently charged with groundwater to present a problem in ISG of part of the Upper Series and ARP TriEnergy is not intending to contemplate ISG of the Upper Series coal seams. Few hardbars occur in this sequence. Coffey et al (1978) term this Sand unit Upper Series Overburden 1 (UOl). Directly above the sands is a sequence of siltstones and mudstones with occasional sandstones. This sub-unit is described as Upper Series Overburden 2 (U02).

2.3.7. Quaternary Surface Cover (QSC)

The Mesozoic sequence is unconformably overlain by a thin mantle of Cainozoic sediments. This surface cover includes:

(a) unconsolidated aeolian surface silts and fine, well sorted sands;
(b) alluvial sands and gravel;
(c) an occasionally well lithified poorly sorted conglomerate, locally termed Telford Gravel;
(d) extremely weathered rocks including shale and coal derived from the underlying Triassic sequence, and;
(e) a resistant gypsum at some localities. The gypsum predominantly occurs directly beneath the conglomerate, although a genetic relationship is not inferred. According to Coffey et al (1978) in view of the generally shallow depth of Quaternary cover (i.e., generally less than 10 m) in relation to proposed depths of mining, no systematic study has been conducted to ascertain its spatial distribution, nature, or precise depth throughout the basin. However an inferred distribution of the Telford Gravels is described by Johns and Townsend (1975), and numerous unpublished ETSA studies.

The surface soils are characterised by their high permeability and often contain groundwater. The Triassic age for the series of coals and associated overburden is also based on the occurrence of a Jurassic outlier preserved in the form of two isolated mesas near Copley. Here, Triassic strata are unconformably overlain by an outlier of essentially flat lying Upper Jurassic tabular cross-stratified sandstones (Parkin 1953, Johns 1973, 1978).

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2.4. Structure

The Telford Basin is an asymmetrically shaped synclinal basin of Upper Triass-Jurassic age, Figure 4. It is an example of a large scale gentle fold, as the interlimb angle falls between 120° and 180°. The basin covers an area of approximately 25 km[2] . The asymmetry of the basin is likely to be controlled by a major fault which strikes along the southern perimeter.

Deformation appears to have been predominantly brittle with minor ductile deformation being observed at only one locality in the mine. For convenience two successive deformations are recognized: Dl and D2. The first post-dates deposition of Lower (LC) and Main (MC) Series coals and associated overburden (Townsend, 1978). During this event a series of normal faults, now commonly arranged in an en echelon pattern, were formed although a variety of other orientations are also found. Many of the fault planes are sub-parallel to bedding, whilst others truncate bedding at angles greater than 80°. This series of faults have the greatest displacement.

Associated with the series of normal faults are smaller scale, randomly oriented, parasitic faults. The parasitic faults also vary greatly in style, and reverse, low angle thrust, conjugate and occasional pivotal faults are recognised. The faults often give rise to mesocopic graben and horst structures, with displacement equal to or greater than seam thickness. In these localities the lateral continuity of the coal seams is greatly reduced and thus would present a problem for ISG. It is possible, however, that these fault bounded blocks occur on a larger scale at greater depths and thus blocks of coal suitable for ISG may yet be delineated by future studies, when more accurate data are available.

The first deformation D1 involving heterogeneous simple shear is most probably a response to localised downwarping of the underlying Precambrian strata.

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Figure 4: Cross Section of Leigh Creek Coal Seams

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A second deformation D2 involved the downwarping of the Upper Series (UC) coals and overburden (UO). Whether D2 is a syn-sedimentary feature or post-dates deposition of (UC) remains unknown. The Upper Series is free of faults, although recent work (K. Sleepers. comm., 1983) indicates that low angle thrusts which are essentially parallel to bedding may be present.

The nature of existing data presents problems in interpreting the details of structure of coal seam continuity at depths below 200 - 300 m. This is due to most previous drilling activity being restricted to the margin of the basin where more accessible coals occur. Previous investigations, however, suggested that the margin of the basin is more faulted than the deeper parts (Johns, 1972; Johns and Townsend, 1975; Townsend, 1978). Although this would be expected as a natural response of strain distribution within folded strata (compression in the troughs of synclines and tension at the crests anticlines), caution must be exercised in stating that the trough of Telford Basin is relatively free of faults.

This is especially so in view of the problems encountered with data collection. The 1978 seismic traverses are a case in point. Problems in transmission of shock waves through the mantle of Cainozoic sediments and regolith of Triassic strata resulted in reduced resolution at depth. Thus fault delineation became difficult at depths below 800 m. Modern day geophysics, particularly regarding 3D seismic (vs older 2D), should support greater accuracy of fault delineation.

Slickensided surfaces on the footwall of fault planes are well preserved in the open pits. Few joints have been identified with confidence that result from unloading of overburden in physically homogeneous rocks.

The presence of faults and joints has several implications for ISG viz.,

preventing continuation of gasification if, faults have throws greater than half seam thickness
collapse of roof materials owing to renewed movement along fault planes during burn
escape of gases along faults and joints, and the possibility of contamination of groundwaters
the translocation of meteoric and ground waters along fractures, extinguishing the flame front.

Further studies of the above in connection with Telford Basin are necessary (see Recommendations).

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3.0. In-Situ Coal Gasification (ISG)

3.1. ISG Background

The overall chemistry underlying coal gasification processes is well understood. Table 3 summarizes the important overall reactions participating in the coal gasification process.

The most important reaction is the gasification reaction (Reaction 1). This is the reaction that produces the syngas comprising H2 and CO. However, as shown in the Table, this reaction is endothermic, and needs external heat input to proceed to any significant extent. This heat is provided by the two oxidation reaction, (Reactions 5 and 6). A part of the coal is combusted by these two reactions to sustain Reaction 1. In addition, a number of side reactions also take place, such as methane formation (Reactions 3 and 4) and the Boudouard reaction (Reaction 7). Additional hydrogen can be made from the syngas by Reaction 2, wherein the available steam reacts with the CO in the syngas to generate more H2 and CO2.

Table 3: Fundamental reactions for coal gasification (adapted from Ruprecht, et al., 1988)

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3.2. Well Characteristics and Flow Path Enhancement

To facilitate flow through the injection well, combustion zone and production wells, a “link” must be created to enhance in-situ permeability of the coal seam; this is usually achieved by directional drilling. The technology of directional underground drilling advanced considerably in the 1990's as a result of developments in the oil and gas industries. The same technology is being used regularly for the de-gassing of coal seams in Australia, South Africa and the United States. For the first time, in-seam coal wells can be constructed reliably and accurately, with much less risk of failure. Furthermore, the option of constructing

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gasification wells in much deeper coal seams, at over 1000 m depth, has become possible. Access to deeper coal brings advantages in terms of cavity growth, power output and environmental benefits, and the possibility of maintaining supercritical conditions for CO2 sequestration (whereby CO2 can remain as a liquid).

ISG operating conditions require injection well construction and materials to withstand the extreme thermal and mechanical stresses associated with ISG: high pressures and temperatures (up to 1500[o] C), sulphidation and oxidation reactions, and subsidence of the cavity roof. Wells are usually cased with carbon or high-strength stainless steel.

Cementing of wells is done above the reaction zone to facilitate the controlled introduction of air and to prevent loss through the wellbore of gases to the surface or into overlying strata. If ISG infrastructure is subsequently used for carbon capture and sequestration (CCS) operations, well materials must also withstand the corrosion associated with carbon dioxide.

The pilot-scale operations in the U.S. and other parts of the world did not last long enough to require mechanical integrity testing (MIT) of wells. However, the Soviet experience at the commercial scale indicates that injection well life is about two to four years.

3.3. Injection Process (CRIP)

One of the most important considerations in ISG is the method used to establish a channel between the injection well and the production well. However, in many cases, the coal seam has low permeability, and other means of establishing the connection between the wells is necessary.

The method to be utilised at the LCEP is the Continuous Retraction Injection Point (CRIP). Successfully proven at several ISG trial sites and considered the best method for efficient production of synthetic gas from underground coal seams (Hill et al., 1983; Hill, 1986).

In the CRIP process, the production well is drilled vertically, and the injection well is drilled using directional drilling techniques so as to connect to the production well, as shown in Figure 3.1. Once the channel is established, a gasification cavity is initiated at the end of the injection well in the horizontal section of the coal seam. Once the coal near the cavity is used up, the injection point is retracted (preferably by gasifying a section of the liner) and a new gasification cavity is initiated. In this manner, a precise control over the progress of gasification is obtained, which leads to a more consistent gas composition.

The CRIP process retracts the combined steam and oxygen injection point to control the location of the combustion front. The syngas, which was more than a third hydrogen in many of the early ISG pilots, (remainder is predominately CO2, CO, CH4 and higher hydrocarbons) is brought to the surface and

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processed to remove particulates (dust being ash and soot), CO2, and H2S and to convert the CO, CH4 and higher hydrocarbons to more hydrogen.

Figure 3-1: Schematic of the CRIP Process.

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Source: Burton et al

3.4. Surface Facilities

The product gas from ISG can be used in a variety of ways, including:

Combustion of CH4, CO and H2 to create electricity.
Extract CH4 and manufacture H2 into additional CH4 for sales into natural gas pipelines.
Extract H2 and combine with N2 (extracted when producing oxygen from air) to create ammonia and ammonium nitrate (fertiliser and explosives).
Direct feed to a fuel cell that can tolerate carbon monoxide to generate low
voltage electrical current, which can be stepped up and fed to a power grid;
The gas can be “shifted” to make a mixture of hydrogen and carbon dioxide, with
very low levels of carbon monoxide, and then fed to a low-temperature fuel cell to generate low voltage current;
Used as a chemical feedstock to produce methanol or synthetic liquid fuels and a variety
of other chemicals via Fischer-Tropsch processes.

Regardless of what the end use is, the gas needs to be cleaned up to make it usable. The

main impurities commonly encountered in the product gas are particulates (ash and soot) and tars, and sulphur compounds, such as H2S/COS.

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3.4.1. Removal of Particulates and Tars

ISG tends to produce fewer particulates in the production gas (Blinderman, 2002) than would be produced by burning coal, because much of the dust remains underground. For the particulates that do exit the production well at the surface, technologies for the removal of particulates are well-established. They include cyclones, bag-house filters, and electrostatic precipitators.

Tars are a mixture of larger hydrocarbon molecules which are liquids or solids at room temperature. The science of removing these is also well understood. These become a valuable by-product, all be it in small quantities.

3.4.2. Removal of Sulphur Compounds, Such as H2S and COS

Technologies for the removal of sulphur compounds from syngas (or producer gas) are well-established. Collectively known as AGR (acid gas removal) technologies, they include absorption of the sulphurcontaining compounds (mainly H2S and COS) by solvents such as methyldiethanolamine (MDEA process), dimethylethers of polyethylene glycol (Selexol process) and methanol (Rectisol process) (Kohl and Riesenfeld, 1979). Essentially gasses containing sulphur-containing molecules are passed through a bed of substances which capture sulphur bearing molecules.

In addition, catalyst-based technologies are available for the removal of sulphur compounds using zinc oxide catalysts (Kohl and Riesenfeld, 1979).

3.4.3. Removal of Mercury and Other Volatile Metals

Coals and water in coal can contain a variety of metals in minute quantities. However these also require removal in ISG operations. There is a possibility of volatile electronegative metals, such as arsenic, mercury, and lead, present essentially in the ash, being reduced and entrained in the product gas in vapor form or as finely divided liquid droplets. If present the concentrations are likely to be extremely small (Sury, 2004). However, in the unlikely event that unacceptable concentrations of mercury and other volatile metals are encountered in the syngas exiting the production well, well-established techniques for their removal are available (Western Research Institute, 2006). It was found that activated carbon (activated charcoal) was the best medium for adsorbing mercury from the syngas. Since the scope of the investigation cited here was to remove mercury from a fluidized bed gasifier, the method used in the study was the injection of carbon particles into a stream of syngas. However, for other gasifiers, including ISG, well-established technology of fixed bed adsorption is readily available (Lund, 1971). As with sulphur removal, gasses with heavy metals (in small concentration) are passed through a filter bed, which captures and traps heavy metals for their safe removal.

3.4.4. Auxiliary Surface Facilities

A number of auxiliary surface facilities may be needed in order to make the syngas suitable for its final use. Among them are:

gas coolers to cool the syngas down to the temperatures suitable for filters;

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filters to remove ash and tar particles.
As mentioned earlier, the amount of ash and tar particulates out of an ISG-production well is significantly smaller than that for a surface gasifier, however, it is unlikely to be zero, hence the need for filters. A number of standard filter technologies may be used, including baghouse filters and electrostatic precipitators;
CO2 removal: If the CO2 is to be captured and sequestered, it may be advantageous to remove it from the syngas, rather than the flue gas. In this case, a number of technologies to remove the CO2 from the syngas are available (Halmann and Steinberg, 1999).
CO2 can also be used as a raw material for the manufacture of urea (fertiliser) or methanol (a chemical feedstock).

3.5. Site Selection

In Queensland 2013 the Independent Scientific Review Panel on ISG handed down its findings to Government which expanded upon Burton’s et al 2010 Best Practices in ISG. It is now regarded globally with regulators that selection of an appropriate site for ISG is the single most important risk mitigation strategy and is therefore crucial to the economic and environmental viability of any ISG proponent. The site selection process should follow a structured approach that progressively analyses the characteristics of the site with the effort and expense escalating with each subsequent phase. Therefore, effort and development cost scale appropriately to reflect a site’s potential. Selection of a suitable site for the operation of an ISG facility involves the investigation and consideration of the factors below:

Target resource,
Regulatory Environment,
Social and community context,
Local land use context,
Receiving Environment,
Geological, geomorphological and hydrological parameters, and
Risk.

The particulars of the target resource that must be accurately assessed as part of the site selection procedure should include quality, size, geological and hydrological setting, and commercial viability of the resource. The efficiency of the combustion process and the quality of the product is partly governed by the water saturation level and hydrostatic pressure within the coal seam. The deeper the seam the less probability there will be for operational problems e.g. uncontrolled ingress of air to the combustion chamber.

As a general guide an ISG site should operate under a rigorous risk-based approach and include, at least, the following attributes:

Coal seam at sufficient depth to ensure that any potential environmental contamination can be demonstrated to have minimal environmental consequences. With deeper coal, there are

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fewer useable aquifers and, if appropriate sealing horizons are present above the gasification depth, there is a much lower probability of materials (gas or liquid) moving to the surface.

Deeper coal also often sits within saline (salty) water which negates any risk to fresh water resources.
Coal seam sufficiently thick to sustain gasification with reasonable likelihood of economic viability. Thin coal gasification will result in excessive heat loss to surrounding rock strata.
Rank of coal should be lignite to non-swelling bituminous coal.
Hydraulic head sufficient to contain efficient gasification (depth below water table).
Coal seam capped by impermeable and competent rock.
Target coal located so that there is sufficient thickness between the target coal seam/measure and any valuable aquifer higher up the geological succession.
Sufficiently distant from rivers, lakes, springs and seeps to avoid contamination should gas molecules escape the cavity.
Absence of major faulting or intrusions in the vicinity of the site. This is dependent on the size of the cavity.
Sufficient distance from the nearest town and/or intensive surface infrastructure, e.g. irrigation or feedlots, and areas of significant environmental value, e.g., world heritage forests or wetlands, to avoid contamination should molecules escape the cavity and to minimise impacts of odours (if any).

Murray et al (1983) identified the Telford Basin, Main Seam and Lower Seam as highly prospective for ISG. He identified knowledge gaps and recommended an extensive drilling programme be made in the areas considered potential for ISG, involving:

geophysically logged holes with deviation surveys;
fully and partially cored holes;
seismic surveys;
more detailed analysis of fault geometry and style;
geotechnical investigations to determine the strength of roof rocks, and
influence of groundwater.

Golder Associates et al (1985) set out to fill those data gaps by completing a geotechnical study and field investigation involving;

Coal seam characteristics (reserves, thickness and continuity);
Roof stability, and
Influence of groundwater.

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3.5.1. Existing Information on Site Selection

The South Australian Department of Mines and Energy has records of the drilling at Leigh Creek since the mine's inception. Available data includes borehole logs obtained between 1950 and 2014. The early drill hole data was incomplete as it had no down hole geophysics and focused upon the shallow coal for box cut mining. The drilling in many cases was for coal assay purposes where coal was cored and sent to a laboratory for proximate analysis. South Australian Resources Information Geoserver (SARIG) holds thousands of drill holes. Proximate analyses of coal appear on many of the borehole logs, and are often used to distinguish coal from carbonaceous shale (in general being the rock layer above the Main Series coal seam.

Several seismic traverses (2D) of the basin conducted in 1978 have been reviewed. Golder Associates 1985 conducted field drilling for geotechnical and hydrological assessment. That data is also available. Golder’s reported good correlation between drill holes and seismic data.

Fault plans for the Leigh Creek coal basins are also available from ETSA and the S.A. Department of Mines and Energy.

At the time of writing, no data were available regarding relative aquifer pressures throughout the sediments. Likewise very little detailed hydrogeological investigations have been conducted. Thus, data concerning aquifer recharge capacities are currently not available.

Strength tests on core or joints are documented in several geotechnical investigations (Coffey et at. 1975, 1977a, b, c, d, e. 1978a, b. 1979a, b).

The area of interest focused upon within this report and relative to site selection is based upon the field work completed by Golder Associates 1985, Figure 3.2.

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Figure 3.2 Golder Associates 1985 Study areas

The location plan for Lobe B is presented as Figure 3.2, showing the outcrop of the Main, Lower Series and Upper Series coal seams. Also shown on the plan are locations of previous boreholes and seismic traverses. This data consists of:

a seismic traverse line AA with three correlation boreholes (BHL3027, 3382 and 1576);
a seismic traverse line BB with two correlation boreholes (BHL914 and BHL3218) plus one borehole entirely in rock (BHL2349);
one additional borehole (BHL3630); and
available cross-sections within open cut region of Main Series.

Cross-sections along the seismic traverse lines have been drawn up to show the inferred continuity of the Main Series coal seam. These sections indicate that the coal seam maintains its thickness and continuity to the maximum interpreted depth of about 450m-500m. Although the seismic traverses picked up minor faults at shallower depths, the coal seam displacements appear to be less than half the seam thickness and should therefore have little effect on the continuity of the gasification process.

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Existing drill hole results show a reasonable correlation of the intersected coal seam updip of the fault with that inferred from the traverses.

Normal gasification procedure would involve the progress of gasification updip in panels. Collapse of the roof would occur progressively as the panel was extracted. Investigation work concentrated on coal within an area updip of faulting governed by:

the inferred fault location, and
the long-term high wall for the open cut (updip).

An existing fully cored stratigraphic drill hole Leigh Creek 3218C drilled in 1978 to over 625.25m is housed at the Department of State Development Core Library, Glenside in Adelaide. This is a crucial core as it is central to the LCEP project area.

A core log and Plates of the core are presented in Appendix B.

The author completed an investigation of the drill core on 31 October 2014. The main seam drill core of interest is stored in trays 94 to 99. The lower V seam is stored in trays 131 to 133.

The core was found to be in excellent condition to allow comprehensive analysis. The roof over the main seam is a clean competent medium strength mudstone. The Main Seam was 18m thick from 379.9m – 398.85m to a floor rock of medium strength mudstone.

The Lower V Seam was 9m thick from 520.6m – 529.3m with a minor siltstone split at 525.25 to 526.1m. The Lower W Seam was 5m thick between 595.7m and 601.2m with several mudstone splits.

The Main and Lower V seam are suitable competence and thickness for gasification at that location.

3.5.2. Field Programme Results

Golder 1985 completed three partly cored deep boreholes (numbered L3964, L3966 and L3967), with shallow holes being drilled alongside the first two holes for installation of near-surface piezometers. Borehole L3964 was drilled on Section AA, while L3966 and L3967 were drilled on Section BB to the northwest of the site.

Boreholes L3964 and L3967 were drilled by open hole methods to a predetermined level, and then lined with steel casing prior to commencement of coring. Rising head permeability testing was performed using a Wireline pneumatic double packer system. Upon completion of coring, boreholes were geophysically logged for a range of nuclear, electrical and acoustic properties using equipment supplied and operated by S.A.D.M.E.

After geophysical logging, a piezometer was installed within the coal seam interval in these two boreholes. The interval between the upper grout seal and the base of the steel casing may also be

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regarded as providing a means of measuring piezometric head at this level. Details of the piezometer installations are shown on Figure 4. A supplementary shallow observation bore (L3965) was completed adjacent to L3964.

Borehole L3966 was intended only to correlate with the seismic data and was drilled open-hole into the coal before coring. No in-situ testing was performed, however the upper section of the borehole can be used to monitor groundwater levels. A shallow observation bore (L3968) was completed adjacent to L3966.

Table 4 summarizes the detailed information for each hole - its depth, cored interval, coal intersection, and location of permeability test intervals. Core recovered over the indicated depths was photographed, and then logged in detail for geotechnical purposes, including:

rock type
estimated strength
bedding dip
joint dip
fractures per metre.

Table 4. Summary of Borehole Details

Borehole No.	Depth (m)	Cored Interval (m)	Coal Intersection (m)	Thickness (m)
L3964	403.7	349.1 - 403.7	371.1 - 389.9	18.8
L3965		Observation Borehole
L3966	260.2	241.0 - 260.2	227.0 - 242.9	15.9
L3967	396.8	312.4 - 396.8	373.2 - 384.7	11.5
L3968		Observation Borehole

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Table 5 Summary of Permeability Testing

Borehole No.	Permeability Test Interval (m)	Permeability (m/s)	Strata
L3964	350.0 - 368.1	1 X 10-9	Roof
	368.4 - 389.9	2 x 10-9	Coal
	389.7 - 403.7	1 X 10-9	Floor
L3967	315.0 - 335.8		Roof
	315.0 - 359.4	4 X 10-9	Roof
	372.0 - 396.8	100 x 10-9	Roof
	384.0 - 396.8	2 x 10-9	Coal

3.5.3. Materials Testing

The strength of roof and floor rocks was determined in the field using Point Load Index testing and Rock Hardness Indentor testing. The Point Load Index (Is) is obtained by testing pieces of core 50mm long, and correlations between Unconfined Compressive Strength (UCS) in MPa and Is have been established, viz.

u.c.s. ~ 25 IS.

For low strength rocks, it is often difficult to obtain suitable specimens for laboratory testing, and under these conditions the Indentor, which simulates the loading of a small circular footing, can be used to obtain an estimate of unconfined compressive strength. For low strength rocks (¢ = 250) a correlation exists between u.c.s. and indentor reading which is linear. As rock strength increases, the relationship becomes non-linear.

The rock strength test data shows:

the correlation curve between Indentor reading and u.c.s.
the correlation between Point Load Index and u.c.s.

It can be concluded from the results that the Leigh Creek rocks are generally of medium strength (i.e. outside the linear range of the Indentor correlation curve), and are uniform with a relatively small scatter in test data.

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3.5.4. Permeability Test Data

The six rising head permeability tests were undertaken after completion of borehole drilling, and were run for approximately one hour. Water level recoveries over this period varied from 0.06 to 4.5m, with five of the tests producing rises of less than 0.6m due to the relatively low rock permeabilities. While the changes in level for most of these tests are small, a result of time limitations on site, the permeabilities calculated are considered to give a reasonable estimate of the in-situ value for the purposes of the feasibility study. Variations in the static water level, as shown by the measurements reported in Table 4, do not have a significant effect on the calculated permeability. Permeabilities for each of the six tests undertaken are listed on Table 5.

3.5.5. Coal Seam Characteristics

Geology

The general geology of the Main Series coal seam in Lobe B was summarized in section 2. Detailed examination of geophysical logs resulted in the separation of the seam into upper and lower splits separated by a middle parting of 1-2m thickness comprised of mudstones, often carbonaceous. Some improvement in coal quality down-dip was anticipated.

Average coal thicknesses were assessed in different areas as follows:

N-W area, dip 15°-20°, 13.3m coal in 15.8m seam
E area, dip 10°-15°, 13.4m coal in 15.2m seam
S area, dip 30°-40°, 8.2m coal in 10.7m seam.

An assessment was made of faulting, and it was concluded that only the southern area of the seam was likely to be affected by faulting to an extent, which would significantly interrupt the gasification of coal to depths of about 600m.

Seam Thickness and Continuity

Coal intersections of 15.9m (L3966), 11.5m (L3967) and 18.8m (L3964) were obtained from the three boreholes drilled by Golders. There was no evidence of intermediate partings over these intervals. These intersections are consistent with the data inferred from previous reports, and from interpretations of the seismic traversing. The results give considerable confidence to the maintenance of seam thickness to depths of around 500m.

These intersections enable a reassessment of seam continuity to be made. It is evident that good correlation exists between the boreholes and seismic traverse, confirming the good continuity of the seam down to the major inferred fault. The strata dip at an angle of about 160 at borehole 3964 on Section BB, increasing to 220 at 3967 on Section AA.

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With respect both to seam thickness and continuity, the additional data obtained for the report gives substantial additional evidence of the suitability of the Main Series coal seam for gasification.

An inspection of drill core Leigh Creek 3218C cored to 624m, adjacent to the Golder investigation site, provides further confirmation of seam continuity.

3.6. Technical Analysis of Gasification

3.6.1. Groundwater Analysis

In the April 1983 report, a simplified analysis of the effects of the gasification process on groundwater levels was made using a finite element groundwater computer package developed by Golder Associates. A computer model was developed to simulate the progressive gasification of a 600m working face at a rate of 100 m/year. This analysis used permeability values provided in a previous report by Coffey and Partners, which were considered at the time to be unrealistically high.

Although permeabilities in the roof and floor rocks obtained in the field programme are relatively uniform, a wide range of values was obtained for the coal. A detailed analysis would thus require a range of permeability values to be used to determine the sensitivity of water inflow and water table drawdown to variations in permeability of the various layers. Other factors to be considered in the analysis are the gas pressure in the cavity and the increased permeability which will result in the caved zone above the cavity.

Given the limited scope of the Golder study, a preliminary analysis has been undertaken using the following parameters:

•	roof permeability	2 X 10-9 m/s
•	coal permeability	3 x 10-9 m/s
•	floor permeability	1 x 10-9 m/s
•	cavity pressure	15 atmospheres
•	effect of caving ignored.

The finite element analysis was used to predict the response of groundwater for the case of a 500m wide gasification excavation progressively introduced over a 20 year period. The coal seam (15m thick) treated in the analysis was restricted to 100m updip of faulting and 200m from the toe of the open cut. The twodimensional model assumed an extensive gasification area along strike (i.e. >2000m).

The analysis for the open cut mining phase indicates an average groundwater inflow rate of 23 ML/year for 1 km face length of the pit, with the phreatic surface after 20 years.

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The effect of underground coal gasification (years 20 to 40) was simulated by applying a constant mine inflow rate from nodes within the excavated area. The inflow rate was selected by trial and error to be compatible with initial and final pressure states in the cavity, given that progressive mining will occur updip. An average inflow rate of 45 ML/year for a 1 km face length was adopted, and five time increments in the gasification of the seam were adopted.

The distribution of water pressure head across the gasified section at the completion of gasification. The uniform fluid pressure of about 150m water head in the excavation results from the assumed cavity gas pressure of 15 atmospheres. The water table, which was lowered about 25m at the updip end of the seam during open pit mining, is lowered to 40m after completion of gasification, i.e. about 200m above the seam.

A lower cavity gas pressure would increase groundwater inflow rates during excavation. It is estimated that zero fluid pressure at the end of gasification would cause an average inflow of 90ML/year per 1 km length. Lowering of the water table is estimated to increase from 40m to 100m, which would still leave a minimum groundwater cover of about 140m over the top end of the excavation area.

If a higher permeability dislocation zone was introduced over the gasified area in the latter stages of excavation, this would cause a marginal increase in groundwater inflow rates, but a significant increase in groundwater table lowering, particularly for the low fluid pressure case. In the extreme case of zero fluid pressure in the cavity, the groundwater cover at the updip end might be close to zero in the latter part of the gasification period.

The coal seam permeability used in the analysis is at the low end of the range measured. If a significantly higher value was adopted, this would result in slight increases in groundwater inflows and water table lowering.

3.6.2. Roof Stability

A preliminary evaluation of roof stability was made in the ETSA 1983 report, using experience derived from the U.K. involving overburden, which was typically well-bedded sedimentary strata. It was estimated that the expected maximum possible settlement might be in the range 0.7 to 0.9 of the seam thickness. For the average coal thickness of 10m used in the ore reserve calculation, this implies a ground settlement in the range 10-13m. The drill core and strength testing showed a mudstone of relatively uniform medium strength , which is consistent with the U.K. rock types from which the data were derived. The projections of maximum ground settlement are therefore considered realistic.

With respect to caving of the coal seam roof, observations of subsidence suggest that the mining width at which closure occurs is about 1.4h (where h is the mining depth below ground surface). For an average mining depth of about 350m, the mining width for closure is thus 490m, i.e. the full width of gasification.

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The height of caving above the gasified zone is estimated from experience at about 0.07 to 0.14h, i.e. between 25m and 50m, or about 1.7 to 3.3 times the seam thickness. It should be noted that the height of the caved zone is restricted by the bulking of the caved material. With a bulking factor of between 1.2 and 1.3, the extent of bulking is limited to between 3 and 5 times the seam thickness before roof support is achieved.

Beyond the caving height, a zone of lesser dislocation will exist within which there will be an increase in rock permeability to a height estimated at up to 10 times the mining height. This effect will of course reduce with distance above the cavity.

3.6.3. Implications of Gasification Process

Sub-bituminous coal resources have traditionally been preferred as such coal shrinks upon heating, this being considered a desirable characteristic. This feature however, is even more pronounced in lignites. Such coals shrink on drying and develop a strongly jointed, highly permeable zone behind the heated face, offering a very large surface of highly reactive char for the reduction reactions. Moreover they are easier to ignite and do not form a hard coke residue. Thus as Leigh Creek coal is of sub-bituminous/lignite rank, it is suitable for ISG.

The Golder field investigation programme enabled a better definition of rock strength and permeability characteristics, and of groundwater leveIs. These parameters have enabled more relevant analyses to be made of groundwater response to creation of the gasified cavity, and of roof stability and surface settlement.

Despite the significant assumptions required to be made for the preliminary analysis undertaken, the results suggest that both groundwater inflow and groundwater drawdown will be acceptable. With respect to groundwater table drawdown, the analyses suggest that with the most unfavourable assumptions, a groundwater cover should be maintained above the coal seam to prevent gas leakage except perhaps at the end of mine life. Given the limited accuracy of all parameters, it can sensibly be concluded that a significant pressure head over the cavity is likely for most of the mine life, and that the long-term situation can only realistically be assessed after data from the early years of operation are obtained.

If mitigation of this issue is required then shallower coal can be extracted by ISG methods ahead of deeper coal.

Conclusions as to roof stability are not significantly changed from those presented in the ETSA 1983 report. The calculations of roof stability suggest that complete closure will not occur until the full seam Iength updip has been gasified. The caved zone will extend perhaps 25 to 50m above the cavity but should have a limited effect on the gasification process because of its development late in the gasification of a particular generator (panel).

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3.6.4. Overview of Lobe B Coal Seams

The Leigh Creek Coalfields have been actively mined for over 70 years. In that time over 1000 drill holes have been completed. Much of that data is held on the SARIG database operated by the Department of State Development (DSD). A review has been completed of all available drill data, seismic lines, technical and coal quality reports.

Coal seams are present[] in the Lower, Main and Upper Series, with the Main series comprising essentially a single seam 6-18 metres thick (but with some mudstone partings).[] The 2014 South Australian Fuel and Technology Report produced by the Australian Energy Market Operator (AEMO) in January 2014, states coal tonnage contained within PEL 650 included 150mt of measured and indicated coal and 350mt of inferred coal. (Table 2.1 South Australian Coal Resources - reference Department of Manufacturing, Innovation, Trade, Resources & Energy (DMITRE) Coal Resources in South Australia - in situ tonnage & quality). AMC references this as indicative of the presence of an exploration target, and emphasises the coal tonnage reported by AEMO is not JORC (2012 edition) compliant.

The relative positions of the three coal seams are shown on Figure 4. With the relatively shallow depth of the Upper Series, and the possibility of developing the open cut to at least 200m, it is probably realistic to ignore the possibility of recovering coal from these seams by gasification. The obvious possibility involves recovery from the Main and Lower Series over the full seam length.

Both of these seams appear to terminate in the south-west area of the basin, possibly along a major inferred fault structure. The vertical separation between the seams, to the extent that it is defined, appears to be roughly constant at about 150m-200m.

Based on a very preliminary assessment of deep seismic survey data, the Main Series seam down dip of the area proposed for gasification appears to maintain its thickness and continuity.

Drill hole Leigh Creek 3218C cored the deepest section to date with the main seam roof contact at 379.9m and a coal seam of 18m thickness. The lower Series coal seam was contacted at 520m and it was of 9.3m in thickness with a 1m split. A core log and photographs are presented in Appendix 3.

The composition of the Lower Series seam is relatively complex, being made up of variably interbedded coal and mudstone according to the limited data available. . The coal bearing interval is comprised typically of an upper and lower split separated by 10m to 20m of mudstone.

The overall coal content exhibits considerable range in both splits, as does the thickness of the major coal bands, which range from 2.5m to 8.0m in the north-eastern area and from 1.7m to 3.6m in the southern areas. The upper split contains several coal bands in excess of 3m thickness, but those in the lower split rarely exceed 1.5m.

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In attempting to achieve a realistic assessment of total exploration potential, it would appear reasonable and perhaps conservative to adopt the known range of seam thickness of between a minimum of 6m to max of 18m adopting an average of 10m in the Main Series and a total of 4m to 6m in the Lower Series with an average of 5m.

A seam length of 3,500m and a width of about 4,500m was determined as representing the total panel of coal available for ISG production. This panel size was based on current knowledge of the basin geology, geometry and coal quality. Proposed exploration drilling to depths of 600m will be undertaken to provide greater control of panel model parameters and provide significantly greater control for estimation purposes. Leigh Creek coal is of sub-bituminous/lignite rank, it is suitable for ISG.

Based on the measured data and our estimated panel size (3500m x 4500m) we have determined that an *exploration target in the following range may be available for ISG production:

Main Series	-	130 to 400 million tonnes	Average	-	220 million tonnes
Lower Series	-	90 to 130 million tonnes	Average	-	110 million tonnes
Total	-	220 to 530 million tonnes	Average	-	330 million tonnes

The limited accuracy of these estimates should be evident from previous discussion.

The coal currently mined from Lobe B at Leigh Creek exhibits the following specifications;

•	moisture	18% to 31%;
•	ash	7% to 13%;
•	volatile matter	21% to 33%;
•	fixed carbon	30% to 35%;
•	total sulphur	0.5% to 0.7%;
•	calorific value around	3,600 to 5,400 kcal/kg.

By ASTM standards, Leigh Creek Lobe B coal is classified as sub-bituminous C, (Drexel and Preiss, 1995).

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Two major factors requiring consideration in determining the best method of developing the complete resource are:

the need to define reserves at depth (>500m), and
difficulties in developing the Lower Series seam if the Main Series is gasified first.

The latter point results from the problems of drilling through caved ground within and above the Main Series seam in order to install ignition holes at lower levels. This issue was identified by Golders however advances in drilling techniques such as horizontal drilling will likely mitigate problems of access into the Lower Series coal seam.

The problem of adequately defining coal seam thickness, reserves, and continuity at depth is obviously of great significance in determining the maximum potential of Lobe B for gasification. This is particularly true for the Lower Series, due to the variable thickness of the seam in the splits.

There is little doubt that an initial programme of seismic investigation and limited deep drilling would be necessary to support any long-term plan to gasify both Main and Lower Series seams to maximum depth.

3.6.5. Coal to Gas Conversion Ratio

The coal quality tests from Leigh Creek are surprisingly similar to the Juanda and Macalister coal measures (Surat Basin, QLD). These were the seams that Carbon Energy Pty Ltd and Linc Energy Pty Ltd gasified in their previous successful Queensland ISG trials where moisture (13%) and volatile matter (33%), (Linc 2008) were almost identical and most important in ISG trial. This would result in the Leigh Creek coal seam gasification product syngas having a similar chemical composition to the Queensland trials, and gasification rates being within the previous trial consumption/production rates given similar inputs. That is maintaining similar gasification chamber pressure and production well injection rates.

Carbon Energy Limited (ASX:CNX) in its ASX release in 2013 described converting an in-situ coal resource to 1P, 2P and 3P gas reserves as defined in the definitions and guidelines set forth in the 2007 Petroleum Resources Management System (“PRMS”) and the 2011 Guidelines for Application of the PRMS, approved by the Society of Petroleum Engineers. The In Situ Gasification conversion rates from coal to syngas in that case were calculated by Tim Hower, MHA, Petroleum Engineer, Colorado USA for Carbon Energy Limited (Carbon Energy Report ASX Release 7/11/13).

The approach used by MHA to estimate the reserves was as follows:

1. Coal in place (Mt) Resource estimate.

A gross volume of syngas in place was calculated using a syngas yield of 16.73 GJ per tonne of in-situ coal. This value was calculated from the data collected from pilot ISG panels at Bloodwood Creek, Queensland Australia. The energy production from the pilot averaged 413 GJ/day. The amount of in-situ

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coal gasified during the pilot test was 24.7 tonnes/day, which yields a value of 16.73 GJ per tonne of insitu coal.

Recoverable syngas volumes were determined by applying a process recovery efficiency value and a geologic risk factor to the gross syngas volumes. The process recovery efficiency was assumed to be 85% based on proof of concept reviews commissioned by Carbon Energy. In addition, a geologic risk factor was assumed to be 95%.

Linc Energy’s (2009 Annual Report) Chinchilla trial produced syngas at similar consumption rates to Carbon. They claim 95% recovery of coal with 75% energy efficiency.

As no definitive testing of coal to energy conversion rates has been undertaken by the current owners of PEL650 and in order to make an assessment of the gas potential of the Leigh Creek Energy Project coal/gas exploration target AMC has assumed that the energy conversion factors identified by a number of other researchers are appropriate in assessing this ISG project.

We accept that Carbon Energy’s conversion metrics, developed as a result of its pilot testing are considered useful in our estimations. We have compared this value along with a number of other energy content values from other projects and sources of information in order to determine what we regard as a reasonable conversion rate from a lignite coal to a syngas approximating natural gas.

We identified that South Australian lignites have a conversion ratio of 15.2 Gj/t whereas Victorian lignites have a value of 9.8 Gj/T (ABARE; Geoscience Australia, 2012) and MIT Energy Club has published lignite as being in the range 10 – 19 Gj/t. While these values are all of a similar order of magnitude we caution that it should be understood that these energy conversion values will vary from project to project. For our estimations we used a value of 14 Gj/t, a coal shrinkage factor of 30% to account for ineffective burning/ignition of coal and to account for ash contents and then converted these to cubic metres of potential gas in place. Table 6 illustrates the potential gas in place based on the parameters identified above. All GIP values have been rounded to the nearest ‘000 MMm3.

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Table 6 Coal to Gas Conversion Calculation

Coal Seam	Seam Thickness (m)	Million Tonnes	GIP (MMm3)1
Main (min)	6	130	33,000
Main (max)	18	400	102,000
Lower (min)	4	90	23,000
Lower (max)	6	130	33,000
Total (min)	10	220	56,000
Total (max)	24	530	135,000

NOTE: The conversion calculation is based on published material (Carbon Energy Limited, Linc Energy Limited, ABARE, Geoscience Australia, MIT Energy Club) but its application to the proposed ISG for the LCEP is conceptual in nature as there has been insufficient test work to date to define an appropriate conversion factor and it is uncertain if further processing following exploration will result in a similar conversion factor.

1 MMm[3] GIP = 26.853 x 1,000,000 Gj
Energy Conversion factor GJ/t = 14
Based on a coal shrinkage factor of 30%
Specific Gravity of coal = 1.4
ISG area 3,500m x 4,500m
Seam thickness is between known values

4.0. Planned AppraisalDrilling

The target area is to the east of the north western study area between two known fault structures. The area under investigation is approximately 4,000m x 3,000m, Figure 4.

The Objectives of the programme are to enhance existing data and drill the holes to meet with the requirement of the The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (‘the JORC Code’). JORC is a professional code of practice that sets minimum standards for Public Reporting of minerals Exploration Results, Mineral Resources and Ore Reserves.

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The JORC Code provides a mandatory system for the classification of minerals Exploration Results, Mineral Resources and Ore Reserves according to the levels of confidence in geological knowledge and technical and economic considerations in Public Reports.

Watson Drilling has been retained to commence drilling at the LCEP site early into 2015 (Quote 2 Table 7) 2). Commencement is dependent upon stakeholder consultation, weather and government permitting.

4.1. Scope of Planned Work Programme

Prior to drilling a surveyor will be required to set up a control point for drill collar survey. The drilling coordinates can then be placed on the ground accurately.

A preliminary 16 drillhole programme has been planned. These consist of 8 partially cored holes and 8 chip pilot holes. In order to save drilling costs and maximise time on site an initial 8 pilot drill holes will be chipped to 600m utilising mud drilling techniques. The eight pilot holes will all be geophysically logged by Coal Seam Wireline Services with a downhole gamma, deviation and density tool.

At each drill location the rig will step back across strike a few meters and redrill the now logged hole by chipping back down to a few meters above the target seams and commence HQ diameter coring through the roof, coal and floor. Depths will be decided by the geophysical logs on site.

Drill core will be laid out and geologically logged, measured and photographed in detail. Coal roof and floor samples will be sent to Bureau Veritas, Brendale QLD laboratory for proximate analysis.

All drill holes will be backfilled with cement grout and drill collars surveyed.

Following drilling in the field the geology, geophysics, survey, laboratory and modelling will all provide the necessary data for a 2012 compliant JORC Statement.

A further six drill holes have been planned to test the extent of the lower seam and geological structure. These are not costed yet as awaiting a decision on to include in this round of drilling.

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Figure 4 Location of Appraisal Drilling Lobe B

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4.2. Appraisal Drilling Expenditure

The drilling programme is designed to take approximately eight weeks 24/7 if possible, as deep holes may be lost if not circulating mud overnight. This means approximately three hitches of two weeks on and one off. The drilling crew consists of three and ARP TriEnergy staff of two. Drill rig and staff will all stand down for the break and return to their respective bases in Adelaide or Interstate. Flights have been calculated on a maximum fully flexible fare from Adelaide to Brisbane. The crew will drive to site from Adelaide airport. Accommodation and meals will be provided by the Leigh Creek Hotel. A summary of appraisal expenditure is presented in Table 7.

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Table 7 Appraisal Drilling Costings

Item	Assumption	Quote 1	Quote 2
Mobilisation	To/from site	5,000	30,000
Chip holes (m)	9,440m	896,800	840,160
Cored holes (M)	1,200m	320,400	228,000
Work rate	$500 hr Assume 5hrs a hole	45,000	45,000
Consumables	Mud casing bits	18,000	18,000
FIFO	$850 E/W	7,650	7,650
Accom	$150/pn	42,000	42,000
Meals	$100/d	28,000	28,000
Crew Travel	$250/h drive time	8,000	8,000
	Sub total	1,370,850	1,246,810
Contingency 20%	Covers overruns, lost rods, bits, weather delays	274,170	249,362
Total Drilling		$1,645,020	$1,496,172

Logging Truck allow $2,000/d plus accommodation and meals x 1 man

Surveyor TBA

Laboratory Analysis TBA

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5.0. Conclusions

Geological Conclusions

This report has completed a historical review of mining and datasets, hydrogeology, geotechnical assessment along with structural and resource geology of the site and its compatibility for ISG. It has reviewed data and reports, which span a significant timeframe back to the early 1950’s. The conclusions derived from this investigation are based firstly upon the findings from previous investigations specifically the work completed by Murray et al 1983 and Golder Associates et al 1985. Secondly the seismic data review and field logging of stratigraphic drill core held by DSD.

The following geological conclusions are made:

The sediments in Telford Basin are of Upper Triass-Jurassic age and were deposited in shallow water conditions within an intramontane basin. Sedimentation occurred within a fluvio-lacustrine environment.
The provenance of the sediments cannot be stated with confidence.
Two deformational events are recognised. The first (Dl), post dates depositional phase 1 and involves brittle fracture of the Lower and Main Series coal measures, a response to tectonic downwarping of the underlying basement. The second deformation (D2) involved the downwarping of the Upper Series coal measures and associated overburden, and is an example of ductile deformation.
Coal seam discontinuity is mainly attributed to faulting. Considerable variation in fault geometry and style is evident on the flanks yet at depth seems less variable.
The Main and Lower Series coal measures are pervasively faulted, although the Upper Series appear unfaulted. Fault displacement in the former is commonly equal to or greater than half seam thickness.
Whether the magnitude of faulting at the margin of the basin is higher than at the centre cannot be determined with confidence although seismic data suggest less structure.
Geological modelling has confirmed that the main seam averages 10m and ranges from 6m to 18m in drill logs. The lower seam ranges from 4m to 6m with a 5m average.
Preliminary evaluation of existing data indicates that a coal[] exploration target in the range of 130 million to 400 million TTIS (Total Tonnes In Situ) may be available within the main seam and an additional 90 million to 130 million TTIS within the lower seam. This provides a total target estimation for the Main and Lower series seams of 220 million to 530 million TTIS (Total Tonnes In Situ).*

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General Conclusions Concerning ISG

Feasibility of LCEP the following conclusions are made:

Based on the parameters identified we have determined that within the two series of coal seams identified at the Leigh Creek Energy Project that gas volumes in place could range from 33,000 MMm[3] to 102,000 MMm[3] for the Main seam with a further 23,000 MMm[3] to 33,000 MMm[3] for the lower seam. The combined total is 56,000 MMm[3] to 135,000 MMm[3] . It is important to recognize that these are potential volumes of gas-in-place and do not represent sales gas volumes.
The coal currently mined from Lobe B at Leigh Creek exhibits the following specifications;· moisture 18% to 31%; ash 7% to 13%; volatile matter 21% to 33%; fixed carbon 30% to 35%; total sulphur 0.5% to 0.7%; calorific value around 3600 to 5400 kcal/kg. By ASTM standards, Leigh Creek Lobe B coal is classified as sub-bituminous C.
Coal quality tests from Leigh Creek are similar to the Juanda and Macalister coal measures (Surat Basin, QLD). These were the seams that Carbon Energy Pty Ltd and Linc Energy Pty Ltd gasified in their previous successful Queensland ISG trials where moisture (13%) and volatile matter (33%), (Linc 2008) were almost identical and most important in an ISG trial.
It is reasonable to assume that Leigh Creek coal seam gasification product syngas having a similar chemical composition to the Queensland trials, and gasification rates being within the previous trial consumption/production rates given similar inputs. That is maintaining similar gasification chamber pressure and production well injection rates.
In Situ Gasification is regarded as being feasible for the Main and Lower Series where faulting or geological structure is absent (which can make panel design and gasification problematic).
The structure of the Telford Basin is complex in areas namely the southern area and on the flanks of the basin margin therefore, additional seismic acquisition and drilling is required prior to ISG panel design.
Geotechnical testing of roof and floor of the coal seams found medium strength competent rocks suitable for ISG chambers.
The hydrogeology of the project area is suitable for ISG with hydraulic conductivity and permeability ideal, preventing either panel extinguishment or unacceptable drawdown.

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The Phreatic surface of groundwater is relatively close to the surface providing a significant hydrostatic head above the ISG chamber.
The LCEP site meets every selection criteria outlined by the Queensland Independent Scientific Panel on ISG.
Significant existing infrastructure is in place, including rail, pipelines, township, airport with sealed runway, fresh water dam, power from the grid and transmission lines.

6.0. Recommendations

The recommendations derived from this investigation are to provide a greater level of geological certainty towards the LCEP, complete a JORC Resource Statement to a minimum Indicated Resource standard and where possible convert In-Situ resources to PRMS P1, P2 and P3 gas reserves.

A preliminary appraisal drilling programme should be made in the areas considered having potential for ISG, involving:

geophysically logged holes with deviation surveys;
seismic 3D data acquisition for fault geometry;
fully and partially cored holes;
geological block modelling;
more detailed analysis of fault geometry and style, and
laboratory analysis of coal.

An estimated 2 million dollars is required to complete 16 exploration holes with data to be compiled for inclusion into a JORC 2012 compliant resource statement to the ASX.

Design and cost a seismic acquisition and interpretation program to identify faulting and seam continuity below 800m.

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7.0. References

7.1. Geological

Adelaide Observer (1888) “ Coal Discovered in SA ”, 30 April 1892 p. 27 - Rob C Wilton, Manager NRG Flinders.

Adrian C. 2009Hutton Geological Setting of Australasian Coal Deposits University of Wollongong, [email protected].

ARP TriEnergy Pty Ltd (2014) “ Legislation Governing the Mining and Petroleum Operations at Leigh Creek ” Confidential Memo 24 September 2014.

Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, (JORC Code) 2012 Edition

Australian Energy Market Operator Limited (AEMO) “ 2014 South Australian Fuel and Technology Report” The report is based on information from Dept of Primary Industries and Resources SA, available as at 1 July 2013. P5. 2014 Australian Energy Market Operator Limited.

Australian Mineral Consultants (AMC) 2015 “Independent Specialist Valuation Report for Marathon Resources Ltd on the Deep Coal Assets of ARP Tri Energy Pty Ltd Leigh Creek Energy Project within PEL 650, South Australia” Company Report to Marathon Resources 2015.

Beaumont, E.A. (1979): "Depositional Environment of Fort Union Sediments (Tertiary, Northwest Colorado) and their Relation to Coal". American Assoc. Pet. Geol. Bull. 63 (2); 194- 217.

www.bom.gov.au/climate/averages/tables/cw_017110_All.shtml accessed 20/10/14

Brick, G; Odermatt, B and Ainslie, R (1997) Leigh Creek Coalfield rehabilitation programs MESA Journal 5, April 1997, Department of Mines and Energy Resources South Australia, pp19-21.

Brown, D.A., Campbell, K.S.W., and Crook, K.A.W. (1969): “ The Geological Evolution of Australia and New Zealand ”. Pergamon Press, Oxford.

Bureau of Resource Sciences, Australia (1997) Australia’s Identified Mineral Resources, BRS, Canberra 1997.

Caplygin, S and Brennan, S (1996) Leigh Creek coal mine - State of the Art MESA Journal 1, March 1996, Department of Mines and Energy South Australia, pp17-19.

Coats, R.P. and Forbes, B.G. (1976): Precambrian Geology of the Adelaide Geosyncline in, LATE PRECAMBRIAN AND CAMBRIAN GEOLOGY OF THE ADELAIDE 'GEOSYNCLINE' AND STUART SHELF, SOUTH AUSTRALIA. 25th International Geological Congress Excursion Guide No. 33A p. 11-15.

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Code for the Technical Assessment and Valuation of Mineral and Petroleum Assets and Securities for

Independent Expert Reports (The VALMIN Code) 2005 Edition

Daily, B., Coats, R.P., and Forbes, B.G. (1976): LATE PRECAMBRIAN AND CAMBRIAN GEOLOGY OF THE ADELAIDE 'GEOSYNCLINE' AND STUART SHELF, SOUTH AUSTRALIA 25th International Geological Congress Excursion Guide No. 33A.

Daily, B., Firman, J.B., Forbes, B.G., Lindsay, J.M. (1976): Geology" in, Twidale, C.R., Tyler, M.J., Webb, B.P. (Eds.). Natural History of the Adelaide Region Roy. Soc. of South Australia.

Drexel, JF and Preiss, WV (Eds) 1995, “ The Geology of South Australia ”, Vol. 2, the Phanerozoic. South Australian Geological Survey, Bulletin 54.

ETSA Corporation (1997) ETSA Corporation Annual Report, Adelaide 1997.

Evans, Simon (1997) “ South Australia turns off Electricity Asset Sale” , The Australian Financial Review, Friday 7 November 1997 p 16.

Geoscience Australia and ABARE, 2012, Australian Gas Resource Assessment 2012

Hansen, E. (1971): " Strain Facies " in, Minerals, Rocks and Inorganic Materials Monograph Series of Theoretical and Experimental Studies. 2; 208 pp.

Harland, W.B., Smith, A.G., and Wilkock, B. (1964): " The Phanerozoic Time Scale ". Geol. Soc. Lon. London. 458 pp.

Industry Commission Inquiry into the Australian Black Coal Industry (1997) The South Australian Black Coal Industry Submission by The Department Of Primary Industries and Resources South Australia.

Johns, R.K. (1972): The Leigh Creek Coal Measures Mineral Resour. Rev., S. Aust. 132; 145-154. (1973): “ A Summary of South Australian Coal Deposits " S.A. Department of Mines and Energy Rept. Bk. No. 73/249; pp. 23-33. and Townsend, I.J. (1975): “ Geology of the Leigh Creek Coalfield ” Paper presented to, Aust. I.M.M. Conf. South Australia, June.

Leigh Creek Coal Train Beckhaus, John Australian Railway Historical Society Bulletin, March, 2000 pp99101.

Mines and Energy South Australia, (1990-1997) Annual Reports and Mineral Production Statistics, Adelaide.

Optima Energy (1997) Optima Energy Annual Report, Adelaide 1997.

" The South Australian Coal Industry " submission by Department of Primary Industries and Resources, South Australia, Industry Commission Inquiry into the Australian Black Coal Industry (1997) accessed at Productivity Commission website 13 Jan 2014.Wikipedia “ Leigh Creek South Australia ” accessed;

Wikipedia “ Leigh Creek South Australia ” Wikipedia website 03/10/14.

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wikipedia.org/wiki/Leigh Creek, South Australia Environment accessed 20/10/14

Wilson, R.G. (1976): " Estimating the Potential of a Coal Basin " in, Muir, W.L.G. (Ed.) Coal Exploration: Proc. of the first International Coal Exploration Symposium; London, England. May 18-21, 1976.

7.2. In-Situ Gasification (ISG)

Bartel, L.C., Dobecki, T.L. and Stone, R. (1980): "Characterization of a Potential Underground Coal Gasification Site in the State of Washington: Proceedings of the 15th Intersociety Energy Conversion Engineering Conference, Seattle, Washington pp. 1315- 1320.

Beyond Zero Emissions (accessed 13 Jan 2014) talks of "Replacing the emissions intensive Northern and Playford B brown coal power plants at Port Augusta with renewable energy".

Blinderman, M.S. and Friedmann, S.J., 2006, underground coal gasification and carbon capture and storage: Technologies and synergies for low-cost, low-carbon syngas and secure storage. Lawrence Livermore National Laboratory, Livermore, CA. UCRL-ABS-218560.

Blinderman, M.S., and Jones, R.M., 2002, The Chinchilla IGCC Project to Date: UCG and Environment, 2002 Gasification Technologies Conference, San Francisco, USA, October 27-30, 2002.

Burton, E., J. Friedmann, and R. Upadhye, Best Practices in Underground Coal Gasification . Lawrence Livermore National Laboratory, USA.

C. Energy, Editor. The Kingaroy Power Station Project

Clayton, J.M. (1980): " In-Situ Coal Gasification (Revised) ". AMDEL REPORT NO. 1328. Adelaide.

Dalton, S., 2004, Cost Comparison IGCC and Advanced Coal, July 2004.

Drexel, J.F. and Preiss, W.V. (Eds), 1995. The geology of South Australia. Vol. 2, The Phanerozoic. South Australia. Geological Survey. Bulletin, 54.

Edgar, T.F., Humenick, M.J., Kaiser, W.E., Carbeneau, R.J. (1981): " Environmental Effect of In-Situ Gasification of Texas Lignite ". E.P.A., May.

Fire in The Hole Science & Technology Review

Ghose, M.K. and B. Paul, Underground Coal Gasification: a Neglected Option. International Journal of Environmental Studies, 2007. 64:6 : p. 777-783.

Green, M. Underground Coal Gasification, State of the Art . in Clean Coal Conferance'2008 . 2008. Bedewo, Poland.

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Grupping, A.W. and Pieterson, R. (1970): " Underground Gasification of Coal: The Filling of Dipping Underground Cavities ". (Source unknown).

Halmann, M.M. and Steinberg, M., 1999, Greenhouse Gas Carbon Dioxide Mitigation. Lewis Publishers.

Hower T 2013, Carbon Energy Report 8/12/09, “Carbon Energy Poised to Become a Major Gas Player Following an 83% Increase in 2P UCG Gas Reserves” Report 7/11/13, (www.carbonenergy.com.au) asx announcements 7/11/13 report attached to announ.

Humenick, M.J., Edgar, T.F., and Charbeneau, R.J, (1982): " Environmental Effects of In-Situ Coal Gasification " pp. 38. (Source unknown).

Kohl, A. and F. Riesenfeld, 1979, Gas Purification, Third Edition, Gulf Publishing Company.

Klimenko, A.Y., Early Ideas in Underground Coal Gasification and Their Evolution. Energies, 2009. 2 : p. 456-476.

Krantz, W.B., and Gunn, R.D. (1981): "An Overview of Underground Coal Gasification - A Comparison of Modelling Studies with Field Test Data" . (Source unknown).

Ledent. P. (1981): "From Classical Mining to the Underground Gasification of Coal". Instelling Voor de Ontwikkeling Van de Ondergrondse Vergassing and Beckervordersandforth Chr. P., (1979): "Joint BelgiumGerman U.C.G. - Field Test in Deep-lying Coal Deposits. 5th Underground Coal Gasification Symposium Alexandria, Virginia, pp. 119-126. (1980): "Linking Study at Great Depth" . 6th Underground Coal Gasification Symposium. Afton, Oklahoma, PP. 10.

Levie, B.E., Krantz, W.B., Camp, D.W., Gunn, R.D. and Youngberg, A.D., (1981 ): "Application of the Spalling- Enhanced Drying Model in Predicting Cavity Geometry and Operating Strategy for the Hanna 2, Phase 2 U.C.G. Field Test" . 7th Underground Coal Gasification Symposium. Fallen Leaf Lake, California pp. 236-245.

Linc Energy, 2008, JORC Report Chinchilla Project, Xenith Consulting Pty Ltd.

McKee, C.R., Way, S.C. and Gunn, R. (1980): "Hydrologic Site Characterization for In-Situ Coal Gasification: 6th Underground Coal Conversion Symposium. July 13-17, 1980 Afton, Oklahoma.

Moran, P.C., P.J.d. Costa, and E.P.C. Cuff, Independent Scientific Panel Report on Underground Coal Gasification Pilot Trials . 2013, Queensland Independent Scientific Panel for Underground Coal Gasification (ISP): Queensland, Australia.

Murray-Wallace C.V et al (1983) Underground Gasification of Inaccessible Leigh Creek Coal Measures – A Preliminary Evaluation of the Geological Structure of the Telford Basin, Rept. Bk. No.83/34

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Nadkarni, R.M., Bliss, C., Watson, W.I. and Little, A.D., (1975): "Underground Gasification of Coal" . Clean Fuels from Coal. Symposium II, Chicago, Illinois, pp. 611-637.

Riet, M.V.D. Underground Coal Gasification 2008.

Schmidt, R.A. (1979): Coal in America. - An Encyclopedia of Reserves, Production and Use. McGraw-Hill Productions Co.

Schrider, L.A., and Wasson, J.A. (1981): "Eastern In-Situ Coal Gasification Field Trial". A.I.A.A. Vol. 5., No.4.

Simeons, C. (1978): Coal - Its Role in Tomorrow's Technology Pergamon Press.

Stephens, D.R., Brandenburg, C.F. and Burwell, E.L. (1980): "Underground Coal Gasification" . C.E.P., April.

Sury, M., 2004, Review of Environmental Issues of Underground Coal Gasification, Report No. COAL R272 DTI/Pub URN 04/1880, November 2004

Thomspon, P.N., Mann, J.R., and Williams, F., (1976): Underground gasification of coal. - A National Board reappraisal N.C.B. Harrow.

Walker, L. Underground Coal gasification: A Clean Coal Technology Ready for Development . The Australian Coal Review 1999.

Ward, C.R., Harrington, H.J., Mallett, C.W. and Beeston, J.W. (Eds), 1995. Geology of Australian coal basins. Geological Society of Australia. Coal Geology Group. Special Publication, 1.

Westmoreland, P.R., Forrester, R.C., and Sikri, A.P. (1978):

"In-Situ Gasification: Recovery of Inaccessible Coal (1977e): "Report on Geotechnical Studies - Phase 3 Additional Stability Studies". Report No. A183/2-5. 30 November, 1977. (1978a): "Drainage Planning Study". Report No. A183/4A, 20 June, 1978. (1978b): "Spoil Dump Stability Studies II. Report Now 183/4C, 18 July, 1978. (1979a): "Electricity Trust of South Australia". Leigh Creek Coalfield, Lobe B - Results of Geotechnical Investigation (1978)". Report No. A183/4E, 30 March, 1979. Reserves". Alternative Energy Sources. Vol. 7 Hydrocarbon Conversion Technology. (Ed.) Verziroglu. McGraw-Hill PP. 3113-3132.

Western Research Institute (WRI), 2006, Removal of Mercury from Coal-derived Synthesis Gas, Final Report for Base Task 1.i, WRI-06-R013, March 2006.

Zvyaghintsev, K.N. (1977): "Underground Gasification of Coal in the U.S.S.R." in, M. Grenon (Ed.): Future Coal Supply for the World Energy Balance. Third ASA Conference on Energy Resources November 28December 2, 1977. pp. 239- 244.

7.3. Geotechnical Reports: Telford Basin, Lobe B, Leigh Creek

Reports by Coffey and Partners Pty. Ltd. to ETSA on the Leigh Creek coalfields, with particular reference to Lobe B, pertinent to this and subsequent studies include;

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Coffey et ale (1975): "South-eastern margin - Report on Geotechnical Studies for Slope Design”. Report No. A183/1-1; 31 October, 1975.

(1977a): "Report on Geotechnical Studies, Phase 3 - Field and Laboratory Studies" . Report No. A183/2-1, 4 April, 1977.

(1977b): "Report on Geotechnical Studies - Proposed Diversion of Leigh Creek" . Report No. A183/2- 2, 18 May, 1977.

(1977c): "Report on Geotechnical Studies Phase 3 Stability Analyses" . Report No. A183/23, 27 July, 1977.

(1977d): "Report on Geotechnical Studies - Mine Dewatering Studies". Report No. A183/2-4. 11 October, 1977.

(1979b): "Stability Studies based On 1978 Geotechnical Investigation" . (Report released during 1979).

Lund, H. F., 1971, Industrial Pollution Control Handbook, McGraw-Hill.

Mawson, D. and Sprigg, R.C. (1950): "Subdivision of the Adelaide System" Aust. J. Sci 13: 69-72.

Murray-Wallace, C.V. (1982): "The Adelaide Geosyncline: Stratigraphy and General Geology: (unpubl.).

Parkin, L.W. (1953): "The Leigh Creek Coalfield" Geol. Surv. of St. Department of Mines. Bull. 31; pp. 74. (Ed.) (1969): Handbook of South Australian Geology. Geol. Surv. of S. Aust.

Phillips, F.C. (1979): The use of Stereographic Projection in Structural Geology. (Third Edition). Edward Arnold, London.

Playford, G. and Dettmann, M.E. (1965): "Rhaeto-Liassic plant micro-fossils from the Leigh Creek Coal Measures, South Australia" Senkenberg, letha 46 (2/3); 127-181.

Ramsay, J.G. (1967): Folding and Fracturing of rocks. McGrawHill Book Company, New York.

Reading, H.G. (1978): Sedimentary Environments and Facies. Blackwell Scientific Publications, Oxford.

Townsend, I.J. (1978): "The Correlation and Depositional History of the Leigh Creek Coal Measures” . S.A. Department of Mines and Energy. Rept. Bk. No. 78/140; pp. 10.

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Appendix 1.

ARP TriEnergy Pty Ltd

Legislation Governing the Mining and Petroleum Operations at Leigh Creek

1. Alinta: Exemption from the Mining Act 1971

The right to mine at Leigh Creek was established under the Electricity Trust of South Australia Act 1946, and gave the Electricity Trust the right to mine any seams of coal vested in the Crown or the Trust at or near Leigh Creek. This was later repealed by the Electricity Corporations Act 1994 which now states that:

‘‘48—Mining at Leigh Creek

A sale or lease of any seam of coal vested in the Crown at or near Leigh Creek or a contract for any such sale or lease or a right to mine any such seam of coal cannot be made or granted by or on behalf of the Crown except as authorised by or under regulations made under the Electricity Corporations (Restructuring and Disposal) Act 1999.

Without limiting SAGC's powers, SAGC may—

(a) mine (by open or closed working) any seams of coal, vested in the Crown or SAGC, at or near Leigh Creek; and

(b) mine (by open or closed working) any substance, vested in the Crown or SAGC, discovered in the course of operations for the mining of coal; and

(c) treat, grade, or otherwise prepare for sale, and use, sell or otherwise dispose of any coal or other substance so mined.

SAGC may authorise another body to exercise all or any of the powers conferred on SAGC under this section.

In this section—

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SAGC means SA Generation Corporation established under Part 3 before the repeal of that Part, as converted into a company under the Corporations Law (whether or not its shares remain in Crown ownership).’’

After the Mining Act 1971 came into effect to regulate mining in the state, the Leigh Creek area was then reserved from the Mining Act.

Section 8 (1)(c) of the Mining Act 1971 states that ‘the Governor may, by proclamation, reserve from the operation of this Act, or any provisions of this Act, any land specified in the proclamation, and the proclamation shall have effect according to its terms’. Section 8 (2) states that ‘the Governor may, by subsequent proclamation, vary or revoke any proclamation made pursuant to this section’.

Under the powers allowed by the Mining Act 1971-1973, on the 14th of February 1974 the town of Leigh Creek was reserved from the operation of the Act through publication in the South Australian Government Gazette.

Under the powers allowed by the Mining Act 1971-1978, on the 22nd June 1978 the new town site was reserved from the operation of the Act through publication in the South Australian Government Gazette.

Under the Mining Act 1971: Section 8, on the 25th of October 1984 the original 1974 town proclamation was revoked and a new proclamation was made for the Leigh Creek Coal Field to reserve the area defined in the Gazette from the operation of section 17, and parts 4, 5, 6A, 7 & 8 of the Mining Act 1971. These sections are outline below (as of 1984 when the proclamation was made):

-Section 17: Obligation to pay a royalty to the state

-Part 4: Prospecting for Minerals

-Part 5: Exploration Licence

-Part 6: Mining Leases
-Part 6a: Retention Leases

-Part 7: Prospecting and Mining for Previous Stones

-Part 8: Miscellaneous Purpose Licence

This left the following sections at the time that the area was still subject to:

-Part 1: Preliminary

-Part 2: Administration

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-Part 3: Reservation of Minerals and Royalty (except for s 17)
-Part 9: Entry upon land, compensation and restoration
-Part 9a: Access to subsurface strata
-Part 10: Wardens court and forfeiture of mining tenements
-Part 11: Assistance to Mining
-Part 11a: Caveats
-Part 12: Miscellaneous

Since 1984 there have been a number of amendments to the Act however, the substance remains the same, being that the Leigh Creek Coal Mine is not subject to licencing under the Mining Act.

The reservation of the area from the Act has the effect that none of the licencing sections applied to that area of land. Tenements cannot be granted on land reserved from the Mining Act.

2. ARP TriEnergy Pty Ltd: PEL 650

ARP TriEnergy will be operating under the Petroleum and Geothermal Energy Act 2000 and has a Petroleum Exploration Licence.

There are 3 stages to the application process before a PEL can be granted. Stage 1 requires a licence to explore and undertake other preliminary activities, such as discussions with indigenous landowners. Stage 2 requires an environmental assessment and approval of environmental objectives to be obtained. Stage 3 outlines the specific details of the planned petroleum operations. These stages are outlined in the document attached.

In considering the grant of a Petroleum Exploration Licence, section 23 of the Act states that the Minister must have regard to the suitability of applicant’s proposed work program for evaluating the prospectivity of the licence area and discovering regulated resources, the adequacy of the applicants technical and financial resources, and if applications have been invited for the licence by public advertisement, the stated criteria for evaluation of the applications.

Petroleum Exploration Licence:

Section 21 of the Act outlines our rights if the Petroleum Exploration Licence is granted. This section states that ‘an exploration licence authorises subject to its terms the licensee to carry out in the licence area- (a) exploratory operations for regulated resources of the kind relevant to the category of licence;

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and (b) with respect to regulated resources of the kind relevant to the category of licence- operations- (i) to establish the nature and extent of a discovery of regulated resources; (ii) to establish the feasibility of production and appropriate production techniques’. It also states that ‘a licensee who holds an exploration licence is entitled, subject to this Act, to the grant of a corresponding retention licence or a corresponding production licence for a regulated resource discovered in the licence area’.

A regulated resource includes ‘a naturally occurring underground accumulation of a regulated substance’. A regulated substance includes ‘petroleum’.

Petroleum is defined in section 4 of the act: ‘petroleum means a naturally occurring substance consisting of a hydrocarbon or mixture of hydrocarbons in gaseous, liquid or solid state but does not include coal or shale unless occurring in circumstances in which the use of techniques for coal seam methane production or in situ gasification would be appropriate or unless constituting a product of coal gasification (whether produced below or above the ground) for the purposes of the production of synthetic petroleum’.

Petroleum Production Licence:

Section 35

(1) Subject to this Act, a person is, on application, entitled to the grant of a production licence for the production of a regulated resource of a particular kind if—
(a) A regulated resource exists in the area for which the production licence is to be granted; and
(b) The person holds, or held at the time of the application for the production

licence—

(i) An exploration licence or a retention licence over the area for which

the production licence is to be granted; or

(ii) A mining tenement under the Mining Act 1971 over the area for

which the production licence is to be granted; and

(c) —
(i) in a case where paragraph (b)(i) applies—the exploration licence

authorised exploration for a regulated resource of the relevant kind or

the retention licence was granted for a regulated resource of the

relevant kind;

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(ii) in a case where paragraph (b)(ii) applies—the mining tenement

authorised operations for exploration for or the recovery of coal and

the production licence is to be granted for in situ gasification or coal

seam methane production (and other related activities as the Minister considers appropriate); and

(d) production is currently commercially feasible or is more likely than not to

become commercially feasible within the next 24 months.’’

The Petroleum (Miscellaneous) Amendment Act 2009 introduced the provision regarding mining tenements to allow holders of coal mining licences (pursuant to the Mining Act) to be granted a PPL for the purpose of producing CSM and for ISG. This was due to a problem at the time stated in the ‘PIRSA Petroleum Group Discussion Draft- Petroleum Act 2000 Implementation Issues’ that ‘’ A number of PEL applications (stated as targeting CSM or ISG) have been received that cover areas already under Mining Act 1971 exploration licences (ELs). Significant sums have been spent in exploration and assessment activities on a number of these ELs, and in some instanced development options are currently under consideration (the majority of coal deposits within South Australia are under EL where the coal is at mineable depth).

This provision does not affect the Leigh Creek Energy Project in any way, as the Leigh Creek Coal Mine does not operate under the Mining Act 1971. However, it is worth noting for any future tenements held under the Mining Act or the Petroleum Act as rights to in situ gasification can be obtained through both Acts. Section 35 (d) is likely to be a crucial factor for overlying tenements if both wanted to undertake in situ gasification in the same area. Section 35 does not prioritise the right to a production licence for those holding an exploration licence or mining tenement.

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Appendix 2.

Geological Log L3218C

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Core Photo of Main Seam Roof Contact (379.9m)

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Core Photo of Main Seam Floor contact (398.55m)

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Core Photo’s of Lower V Seam (Box 519m to 522m)

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Core Photo of Lower V Seam (522 – 525m)

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Core Photo of Lower V Seam (526 – 528m)

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Appendix 3.

JORC 2012 Table 1

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JORC Code, 2012 Edition – Table 1

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

Criteria	Commentary
Sampling	•Most of the drilling data used to assess the leigh creek coal seams
techniques	was historic, up to 50 years.Triangulation of seams based on
	geological and geophysical logs. The accuracy of the seam depths
	and thicknesses have been determined by AMC as of sufficient
	accuracy for an Exploration Target estimate. Coal quality data
	assessed in various reports refer to reference list.
Drilling	•Drilling described as diamond drillingand stratigraphic fully cored
techniques	holes.
Drill sample	•Core recovery not critical for many of the holes since geophysical
recovery	logs confirm depths and seam widths. Since coal qualities have been modelled the core recoveries at the seam contacts are critical. There
	are no records of the core recoveries in the older holes.
Logging	•All the holes used in the exploration target modelling have lithological
	and/or stratigraphic logs. The DSD SARIG web based drillhole
	database was utilised.
Sub-sampling	•Coal qualities were not modelled so sub-sampling not relevant.
techniques and sample	Where core qualities were tested in the most recent holes the entire drill core was sampled.
preparation	•Coal qualities mentioned in this report are for general guidance only and not part of any resource estimate. They are however widely
	published – refer reference list.
Quality of	•Coal qualities were not modelled so the quality of the laboratory test
assay data	results are not relevant.
and	•Where proximate core qualities from the most recent holes are
laboratory	mentioned in the report, the laboratory that conducted the tests is industry certified and followed industry standard testing procedures.
tests
Verification	•No verification samples were collected.
of sampling
and assaying
Location of	•The accuracy of the surveying has not been determined by AMC but
data points	is considered accurate enough for an Exploration Target estimate.
	•All coordinates are in GDA54 grid.
	•The project area is generally flat with limited topographic variation.
Data spacing	•The data points are on an approximate 500m x 2500m grid in part in-

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Criteria	Commentary
and	filled to 400m apart.
distribution
Orientation of	•The grid spacing is appropriate for the orientation of the seams after
data in	regional structural displacement.
relation to
geological
structure
Sample	•N/A
security
Audits or	•No audits or reviews of the sampling or data have been carried out.
reviews

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria	Commentary
Mineral	•ARP TriEnergy have 100% tenure over the project area under
tenement and land tenure	Petroleum Exploration Licence (PEL) under the Petroleum and Geothermal Act 2000. Alinta have tenure under an exemption proclamation. See appendix 1.
status	•Native Title is extinguished within PEL650.
Exploration	•A full list of references are included as part of the report.
done by other
parties
Geology	•Permian coal seams within the Leigh Creek Coal Fields South
	Australia.
Drill hole	•Approximately 50 years were used in the asessment.
Information
Data	•All seam thicknesses calculated from logged top and bottom of the
aggregation	seams using geologist logs or geophysical logs where available.
methods	•Stone partings were included in seam thicknesses.
	•“Visual” estimates of coal contents of seams (i.e. excluding stone
	partings) based on inspection of logs and drill core at the Department
	of the State Development Library, Glenside Adelaide.
Relationship	•Since all the holes are drilled vertical, with only small deviations down
	the hole,and the coal seams aregenerallyflat(no more than +/- 20

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Criteria	Commentary
between	degrees) the seam intercepts are only marginally greater than true
mineralisation	seam widths.
widths and
intercept
lengths
Diagrams	•Appropriate plans and sections included in report.
Balanced	•No data was excluded or included to bias results.
reporting
Other	•No other meaningful or material data that could affect the results is
substantive	known to AMC..
exploration
data
Further work	•Further drilling, logging, laboratory and processing tests
	recommended to produce a resource estimate.

Section 3 Estimation and Reporting of Mineral Resources

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)

Criteria	Commentary
Database	•Most of the data used in the coal seam tonnage estimates is from
integrity	historic drilling. Where possible copies of original sources used to source data is identified in Reference section.
Site visits	•Site visit undertaken by the authors of this report on 7thJanuary 2015.
	•LCEP is over an operating open cut mine, coal seams can be
	mapped at the surface.
Geological	•The overall geological model fairly represents the geology of the
interpretation	seams. Due to the wide drill hole spacing and some difficulties in interpreting historical logs minor errors may have resulted in the
	interpretation but these errors would not significantly affect the
	tonnage estimates or affect the JORC Code category assigned.
Dimensions	•The Telford Lobe is approximately 7 x 5 km and is the largest of five
	discrete basins.
Estimation	•The modelling technique used to estimate the seam coal tonnages is
and	appropriate for the quality and density of the available data.
modelling	•Two methods were used to estimate areas of each of the seams as a
techniques	check and the areas calculated by both methods corresponded well.
	•Onlytonnages were estimated byAMC. Proximate analyses and

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Criteria	Commentary
	processing test results mentioned in the report are provided as a
	general guide only.
Moisture	•All coal tonnages are based on assumed bulk densities that represent
	coal “air dried”.
Cut-off	•The seam thicknesses are based on geological and geophysical logs
parameters	of coal seams.
Mining	•No mining factors or assumptions are made.
factors or	•Most of the modelled coal, because of its depth below the current
assumptions	topographic surface, would need to be mined using underground
	mining methods.
Metallurgical	•No metallurgical or recovery factors have been assumed.
factors or
assumptions
Environmen-	•No environmental factors were considered for the reported tonnage
tal factors or	estimates.
assumptions	•Current environmental restrictions noted in the report require
	approvals for drilling sites.
	•Given that this an existing coal mine and since most of the coal would
	need to be mined using underground mining methods it can be
	reasonable assumed that the best economic recovery for deep
	stranded coal would be ISG with a minimal environmental footprint.
Bulk density	•All coal tonnages are based on assumed bulk densities that represent
	coal “air dried”. The assumed bulk densities are based on similar
	coals in the region.
Classification	•Due to the wide drill hole spacing and some difficulties in interpreting
	historical logs the tonnage estimates have been assigned a JORC
	Code category of Exploration Target which is not a resource. These
	estimates are only conceptual in nature and future exploration may or
	may not eventually convert all or part of these estimates to resources.
Audits or	•There have been a reviews of the reported coal tonnages by the
reviews	author based on prior reports from DSD and other government departments. Continous drilling further maintains the current
	estimates published.
Discussion of	•The tonnage estimates have been assigned a JORC Code category
relative accuracy/	of Exploration Target which is not a resource. These estimates are only conceptual in nature and reported as ranges to reflect the uncertainties and future exploration may or may not eventually
confidence	convert all or part of these estimates to resources.

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Appendix 4.

Tenement licence Status Report

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PEL 650

PEL 650
Tenement Type	Petroleum Exploration Licence (Petroleum and Geothermal Energy Act 2000)
Tenement Number	650
Area	93.4 Km2
Status	Granted (instrument publically available on South Australian Department of State Development website)
Date	18 November 2014
Expiry Date	17 November 2019
Application Fee	$4,085
Renewal Fee (5 years after grant)	$2,043
Ongoing Annual Fee	$3,456
Ongoing Exploration Expenditure	$1,200,000 per annum
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	No
Native Title	No

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PELA 649

PELA 649
Tenement Type	Petroleum Exploration Licence Application (Petroleum and Geothermal Energy Act 2000)
Tenement Number	649
Area	2,308 Km2
Status	Under Application
Date	24 September 2014
Expiry Date	5 years after date of licence grant
Application Fee	$4,085
Renewal Fee (5 years after grant)	$2,043 (when granted)
Ongoing Annual Fee	$3,456 (when granted)
Ongoing Exploration Expenditure	$2,500,000 over 5 years from licence grant date
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Multiple tenements under the (Mining Act 1971), which are excluded from extracting petroleum products
Native Title	Native Title Determination Applications: Barngarla Native Title Claim Tribunal reference Number: SC 1996/004 Date registered: 4/4/1996 Nauo Native Title Claim Tribunal reference Number: SC 1997/008 Date registered 18/11/1997

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PELA 644

PELA 644
Tenement Type	Petroleum Exploration Licence Application (Petroleum and Geothermal Energy Act 2000)
Tenement Number	644
Area	8,932 Km2
Status	Under Application
Date	15 July 2014
Expiry Date	5 years after date of licence grant
Application Fee	$4,085
Renewal Fee (5 years after grant)	$2,043 (when granted)
Ongoing Annual Fee	$3,456 (when granted)
Ongoing Exploration Expenditure	$2,500,000 over 5 years from licence grant date
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Multiple tenements under the Mining Act 1971, which are excluded from extracting petroleum products
Native Title	Determinations of Native Title in the Federal Court of Australia Kokatha People (Part A) Tribunal Reference Number: SCD 2014/004, Determination date: 1/09/2014 Native Title Determination Applications: Kokatha Native Title Claim Tribunal reference Number: SC 2014/002 Date registered: 17/11/14 Adnyamathanha #5 Native Title Claim Tribunal reference Number: SC 2012/004 Date lodged: 8/11/12 (not accepted for registration)

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PELA 647

PELA 647
Tenement Type	Petroleum Exploration Licence Application (Petroleum and Geothermal Energy Act 2000)
Tenement Number	647
Area	8,932 Km2
Status	Under Application
Date	15 July 2014
Expiry Date	5 years after date of licence grant
Application Fee	$4,085
Renewal Fee (5 years after grant)	$2,043 (when granted)
Ongoing Annual Fee	$3,456 (when granted)
Ongoing Exploration Expenditure	$2,500,000 over 5 years from licence grant date
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Multiple tenements under the Mining Act 1971, which are excluded from extracting petroleum products
Native Title	Determinations of Native Title in the Federal Court of Australia Adnyamathanha No. 1 Tribunal reference number: SCD 2009/003 Determination date: 30/03/2009 Adnyamathanha No. 1 – Stage 2 Tribunal Reference Number: SCD 2014/001 Determination date: 25/02/2014

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REVIEW REPORT LCEP PEL 650

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PELA 643

PELA 643
Tenement Type	Petroleum Exploration Licence Application (Petroleum and Geothermal Energy Act 2000)
Tenement Number	643
Area	5,813 Km2
Status	Under Application
Date	15 July 2014
Expiry Date	5 years after date of licence grant
Application Fee	$4,085
Renewal Fee (5 years after grant)	$2,043 (when granted)
Ongoing Annual Fee	$3,456 (when granted)
Ongoing Exploration Expenditure	$2,500,000 over 5 years from licence grant date
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Multiple tenements under the Mining Act 1971, which are excluded from extracting petroleum products
Native Title	Determinations of Native Title by the Federal Court of Australia Adnyamathanha No. 1- Stage 1 Tribunal Reference Number: SCD 2009/003 Determination Date: 30/03/2009) Adnyamathanha No. 1 – Stage 2 Tribunal Reference Number: SCD 2014/001 Determination date: 25/02/2014 Adnyamathanha No. 1 –Stage 3 Tribunal Reference Number: SCD 2014/002 Determination date: 25/02/2014

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REVIEW REPORT LCEP PEL 650

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Native Title Determination Applications Adnyamathanha No. 1 Tribunal Reference Number: SC 1999/001 Date registered: 31/03/1999 Malyangapa Peoples Tribunal Reference Number: SC 2013/004 Date lodged 28/08/2013, (not accepted for registration)

PELA 582

PELA 582
Tenement Type	Petroleum Exploration Licence Application (Petroleum and Geothermal Energy Act 2000)
Tenement Number	582
Area	5,677 Km2
Status	Under Application
Date	15 July 2014
Expiry Date	5 years after date of licence grant
Application Fee	$4,085
Renewal Fee (5 years after grant)	$2,043 (when granted)
Ongoing Annual Fee	$3,456 (when granted)
Ongoing Exploration Expenditure	$2,500,000 over 5 years from licence grant date
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Multiple tenements under the Mining Act 1971, which are excluded from extracting petroleum products
Native Title	Determinations of Native Title in the Federal Court of Australia Arabana People

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REVIEW REPORT LCEP PEL 650

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Tribunal Application number: SCD 2012/002 Determination date: 24/05/2012

ELA 2014/00232

ELA 2014/00232
Tenement Type	Exploration Licence Application (Mining Act 1971)
Tenement Number	2014/00232
Area	942 Km2
Status	Exploration Licence offered 12 February 2015
Date	Accepted 3 March 2015
Expiry Date	1 year after date of licence grant
Application Fee	$750
Acceptance Fee	$10,738
Ongoing Annual Fee	$10,888
Ongoing Exploration Expenditure	$130,000 per annum
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Overlying Petroleum Exploration Licence Application
Native Title	Determinations of Native Title in the Federal Court of Australia Adnyamathanha People No 1 Tribunal reference Number: SCD 2009/003 Determination date: 30/3/2009

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REVIEW REPORT LCEP PEL 650

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ELA 2014/00238

ELA 2014/00238
Tenement Type	Exploration Licence Application (Mining Act 1971)
Tenement Number	2014/00238
Area	351 Km2
Status	Exploration Licence offered 12 February 2015
Date	Accepted 3 March 2015
Expiry Date	1 year after date of licence grant
Application Fee	$750
Acceptance Fee	$4,001
Ongoing Annual Fee	$4,151
Ongoing Exploration Expenditure	$65,000 per annum
Ownership	100% ARP TriEnergy Pty Ltd
Overlying Tenure	Overlying Petroleum Exploration Licence Application
Native Title	Determinations of Native Title in the Federal Court of Australia Arabana People Tribunal Application number: SCD 2012/002 Determination date: 24/05/2012 Adnyamathanha People No 1 – Stage 1 Tribunal reference Number: SCD2009/003 Determination date: 30/3/2009 Registered Native Title Determination Applications Arabana People No 2 Tribunal reference Number: SCD2013/001 Registration date: 10/5/2013

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AI assistant

NEURIZER LTD — Proxy Solicitation & Information Statement 2015

65442_rns_2015-04-26_90f3bfa3-2e98-477e-ab7a-83e048954223.pdf

ASX Code: MTN: 2015 Extraordinary General Meeting

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