Contango has a 70% interest in the Lubu Coal Project (“Lubu”) in Zimbabwe, with the remaining 30% held by supportive local partners.
Previous owners have expended +$20M on Lubu, which has enabled a sizeable resource in excess of 1.3 billion tonnes to be identified under NI 43-101 standard. Contango will initially focus on producing metallurgical coal from Block B2, where extensive work has also been undertaken to define the specific properties of the coal, which in turn has enabled offtake conversations to commence. The coal seams within Block B2 are from surface down to a maximum depth of 47m, ensuring operating costs are kept at very attractive levels. Contango is focussed on achieving the production of metallurgical coal products and sales to international industrial consumers in the Southern Africa region.
In the longer term, the Company may expand operation to fully develop the coal field to exploit thermal coal opportunities.
The Lubu Coal Project covers 19,236 hectares of the highly prospective Karroo Mid Zambezi coal basin, located in the established Hwange mining district in north-western Zimbabwe. Historically, c.US$20M has been spent on advancing the Lubu Coal Project including the following work:
Forecast sales of coal product expected from a small proportion of the B2 block include: