The Pinehouse Lake Coal Project is located west of La Ronge, SK. Historical drilling in this region intersected Mannville (Cretaceous) coal seams approximately 50 metres from surface in a region where glacial till cover is limited. Geological evidence suggests that this region may be a location where basins could have developed, allowing for significant intersections of coal to be preserved. Initial drilling will confirm historic coal intercepts and initiate a phased step-out drilling to explore for thicker, near-surface coal seams. Positive results from this first phase will lead to additional drilling to define a potential coal resource.
Wescan initiated a coal exploration program on its 100 percent owned property near Pinehouse Lake, Saskatchewan in 2009. The Company has 50 coal dispositions; covering 38,304 hectares in an area where Mannville aged coal (Cretaceous) is known to exist. Historical drilling in this region intersected 1 to 3 metre thick coal seams at approximately 50 metres below surface in a region where overburden is limited.
The initial drilling of 8 completed drill holes confirmed the presence of coal in 6 drill holes, with the largest carbonaceous zone up to 14.8 metres in thickness in hole PHL09-J (see Table 2). Four holes contained coal zones greater than 5 metres thick. All completed drill holes penetrated through the Mannville section to the Paleozoic/Precambrian basement in order to identify areas that may have formed basins necessary to host thick intersections of coal. Definition of these basins in the Devonian paleosurface is critical to exploring for Mannville-aged coal occurrences. Utilization of airborne geophysics to identify such basins is currently being investigated.
This initial drill program at the Pinehouse Lake Property aimed to confirm the historical coal intersections and obtain geological stratigraphic data that will be used in developing a stratigraphic and structural model for targeting thicker, near-surface coal seams. A data review is also being conducted on this property with similar recommendations anticipated to the Hudson Bay Project.
During 2011, a review was conducted of all regional geophysical and geological data relating to the Company’s coal exploration properties. Wescan management; together with consultants North Rim Exploration have been assessing which of our coal permits we could drop and which permits we could keep prior to the lapse of the original 3 year rental. These original permits had no cost attached to them other than the permit application cost of $1 per hectare in 2008. In 2009, Wescan completed an 8 hole program at Pinehouse Lake to confirm historical drill hole data. Now by regulation, each disposition can be extended for 2 additional consecutive 6 month periods for a cost of $1 per hectare. Following the completion of these extensions these dispositions could then be carried forward into what the government has called an annual “lease” at a cost of $5.50 per hectare. Based on this review, and also factoring in the additional expenses that would be necessary to convert the coal permits to more expensive leases (as would have been required in the near term), the Company determined that its financial resources would be better served pursuing its gold properties. As a result, the Company has allowed the majority of its coal permits to lapse, with the remainder to lapse in early 2012.
