Stanmore Confirms 52Mt Coal Reserves at Isaac Downs Extension with +20-Year Mine Life

Overview of the Isaac Downs Extension Reserves Update

Stanmore Resources Limited (ASX: SMR) has provided an updated maiden Reserves Statement for its Isaac Downs Extension Project, a metallurgical coal mine located in Queensland's Bowen Basin. The update confirms 52 million tonnes (Mt) of Run of Mine (ROM) coal reserves, inclusive of 34Mt of marketable coal, marking a significant milestone for the company and its shareholders. The reserves are classified with high confidence, comprising 75% proved and 25% probable categories, in line with the Joint Ore Reserves Committee’s Australasian Code (JORC Code 2012).

The project is positioned to deliver a mine life exceeding 20 years, with an annual production capacity of approximately 4Mt ROM. Importantly, the development requires relatively low capital expenditure by utilising existing coal handling and preparation plant (CHPP), dragline, and haul road infrastructure at the nearby Isaac Plains operation.

Technical and Economic Validation

The reserves update follows a comprehensive Pre-Feasibility Study (PFS) conducted by Palaris Australia Pty Ltd, which independently assessed the open-cut coal reserves and confirmed the project's technical feasibility and economic viability. The PFS incorporated detailed mine planning, pit optimisation, and economic modelling, resulting in a positive net present value (NPV) at a 10% discount rate. The study also factored in geological, geotechnical, environmental, and operational modifying factors to ensure realistic reserve estimates.

Mining will employ a conventional dragline strip mining method supported by excavators and trucks, with waste initially hauled to out-of-pit dumps before transitioning to in-pit dumping. The project benefits from a favourable strip ratio of approximately 7.9:1 bank cubic metres per tonne (bcm/t) of ROM coal.

Coal Quality and Product Strategy

The Isaac Downs Extension coal reserves include two primary products: a high-quality metallurgical coal with approximately 10.5% ash and a secondary thermal coal averaging around 19% ash. Coal quality analyses indicate that the Leichhardt and Vermont seams will produce coking coal products similar to those from the existing Isaac Plains deposit, albeit with slightly lower yields. The processing will be conducted at the existing Isaac Plains CHPP, which is equipped with dense medium cyclones, teetered bed separators, and flotation cells to handle coarse and fine coal fractions.

The project aims for a balanced product split, targeting roughly equal volumes of metallurgical and thermal coal, providing flexibility to respond to market conditions. Washability and yield simulations underpin the marketable reserve estimates, with an overall processing yield expected to be around 65%.

Infrastructure, Environmental, and Social Considerations

Leveraging existing infrastructure significantly reduces upfront capital requirements. Coal will be transported via road trains to the Isaac Plains CHPP, with a new bridge planned to cross the Isaac River to facilitate haulage. Existing rail and port facilities will be utilised for export logistics.

Environmental and social impact studies are underway to support regulatory approvals. Stanmore is actively engaging with stakeholders, including local councils and Indigenous groups, to secure land tenure and native title agreements in parallel with mining lease applications. While environmental impact assessments are at an early stage, the company has identified and is managing typical risks associated with Bowen Basin coal projects, including flood management and progressive rehabilitation.

Outlook and Strategic Implications

Stanmore’s declaration of reserves at Isaac Downs Extension enhances its total coal reserves to 586Mt, reinforcing its position in the metallurgical coal sector. The project’s long mine life, combined with low capital intensity and utilisation of existing assets, positions Stanmore well to capitalise on future market opportunities. However, the company must navigate regulatory approvals and evolving market dynamics, particularly in thermal coal demand.