African Energy Reports Encouraging Coal Results at Sese, Botswana

The Directors of African Energy Resources Limited (AFR) are pleased to announce the results of preliminary proximate analysis on raw coal recently discovered on its wholly owned Sese project in northeast Botswana.

The Company has also been able to retrieve open file exploration data which includes proximate analyses for two core holes drilled in 1976 by Shell Coal Botswana Pty Ltd (Shell), which further support the analyses undertaken on the AFR core.

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The results confirm that the areal extent of the coal and the average quality of the coal is sufficient to warrant further investigation. The Company is actively seeking a suitably qualified cornerstone project partner to advance the discovery to the next stage.

Proximate Analyses of Coal at Sese

Immediately after the discovery of coal at Sese by AFR, four diamond drill core holes were drilled to collect samples for proximate analyses (for locations of AFR and Shell core holes refer to Diagram 2). The proximate analyses for AFR raw coal core were undertaken at ALS Chemex’s coal laboratory at Witbank in South Africa, and all analyses are quoted on an air dried basis.

Sixty‐five individual raw coal core samples were selected for analysis on the basis of geological boundaries and have been summarised as weighted averages of composite intersections exceeding a calorific value (CV) of 12 M/kg. The four AFR holes were drilled vertically, and indications to date are that the coal seams dip at less than 1 degree, so the quoted widths approximate true width intersections.

The six holes for which proximate analyses are available cover a large proportion of the known strike length of the coal deposit and are widely separated. They are therefore believed to.give only a preliminary indication of the average coal quality across the deposit. The average for the unwashed, raw coal indicates a seam thickness of approximately 9m, with a calorific value of 19 MJ/kg (4,550 kcal/kg), ash content of 27% and sulphur content of 1.8%.

The data published by Shell indicates an average specific gravity for the coal in holes N8 and N9 of 1.59. Further drilling and proximate analyses would be required to establish an initial inferred resource.

Proximate analyses of washed coal for Shell holes N8 and N9 are also shown in the table above, and indicate that below a specific gravity of 1.60, a yield of 60% provides coal with a calorific value of approximately 22.5 MJ/kg (5,375 kcal/kg), ash content of 16‐20% and low sulphur content below 0.4%.

Discussion of Results and Future Plans for the Sese Coal Project

The limited drilling completed to date on the project shows that coal seams are present over a strike length of 30km, and up to 4km down‐dip (Diagram 2). The average coal seam thickness is 10‐12m with an average depth to the top of the seam of 41m. The raw (unwashed) coal quality data and the combination of relatively thick but shallow seams suggest that this deposit compares will with other known coal deposits in the southern Africa region.

The Directors consider that this combination of preliminary coal quality, areal extent, thickness and shallow depth suggest that a commercially viable coal mining operation may be possible at Sese and warrants further evaluation. The Company is therefore actively seeking a suitably qualified cornerstone project partner to manage the future assessment of the Sese coal project.