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Monday, 22 December 2014

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Longtown site has potential bordering on one of world’s best for coal mining

Coal reserves near Longtown offer one of the world’s best mining opportunities and could create hundreds of jobs.

Longtown mine photo
Ian Wilson, left, non-executive director of subsidiary Lochinvar Coal and Gary Fietz, managing director of New Age Exploration Ltd

That’s the view of the man in charge of an Australian company exploring the Lochinvar field, which straddles the border.

Gary Fietz, the managing director and chief executive of New Age Exploration (NAE), based in Melbourne, made the comments while on a visit to a borehole being worked on close to Chapelknowe.

The company is drilling to find coking coal, which is used to produce steel.

This is the second such hole the firm has worked on.

The first, at Stubbyknowe, struck coal last month.

This material is currently being analysed.

Mr Fietz, who flew in from Australia for the site visit this week, said: “So far these results have been encouraging.”

Australia’s mining companies are expanding into other countries around the world.

Mr Fietz pointed out that Lochinvar – which extends north to Evertown, near Canonbie, and south to Longtown – is seen by his firm as a good place to explore.

NAE, which operates in the UK through a subsidiary called Lochinvar Coal, is also working in Colombia and also in Cornwall.

Its move has been backed by stockbrokers in both Australia and the UK.

The field is believed to contain between 300-400 million tons of coking coal.

“It is a high value product which is the only thing you can make steel with,” Mr Fietz said.

He also praised local infrastructure, a skilled workforce and supportive communities.

“When we looked around the world, this ticked all the boxes.”

The company has raised 7.5m Australian dollars (about £5.2m) to fund the exploration. Around a quarter of this was raised in the UK, with the rest coming from around the world.

The licence to explore Lochinvar cost £12,500.

Mr Fietz stressed that the project was at an early stage and a full working mine was a while off.

“It’s not going to be overnight – 2016-17 is an honest, realistic, earliest possibility.”

The coal would be extracted by miners working in tunnels. This would see the creation of an inclined pathway, likely to be at the north of the field where the coal is shallowest.

If a mine does open, it could create 200 to 300 jobs with more in supporting industries.

Mr Fietz said some expertise would need to beimported but that the company would be keen to recruit as many local workers aspossible.

He added that the mine would be likely to produce from one million to three million tons of coal a year.

The main market for this would be the UK’s remaining steel mills – in Scunthorpe, Port Talbot and Teesside – with the coal being transported by railway. The nearest connections to the west coast mainline are at Gretna and Longtown.

There has been speculation about the company using the Ministry of Defence’s (MoD) munitions depot in Longtown as a hub. This is the town’s largest employer – with 300 staff – and has been threatened with closure.

Mr Fietz confirmed that he had had meetings with the MoD but would only comment: “For us it’s very positive that it is an option.”

He also thanked communities in Cumbria and southern Scotland for the support the company had received.

Currently the company has had discussions with several different farmers about drilling on their land, and had held meetings in Longtown, Langholm and Canonbie.

The firm’s contractors work on site for about 12 hours a day. They drill through the surface of the land, attaching tube-shaped extensions as they progress.

A wireline is attached to the top of these. As they fill, samples of what has been found are removed and then examined by geologists.

If coal is discovered, it is sent for tests in England, Scotland and Germany.

Despite the coalfield straddling the border, Mr Fietz is not concerned about the prospect of Scottish independence, believing the project would still be supported by a new government.

For more details on NAE, visit www.nae.net.au

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