Projects - Elimatta

LOCATION: EPC650 and MDL(app)373. Near Wandoan, Queensland
OWNERSHIP: 100% NEC
PROJECT PHASE: PRE-FEASABILITY
PRODUCT: High volatile, low nitrogen, low sulphur export thermal coal. Use of the deposit for Coal to Liquid (CTL) technology is a potential alternative.

ESTIMATED RESOURCE: ~244 Mt
Measured Resources : 129 Mt
Indicated Resources: 75 Mt
Inferred Resources : 40 Mt

MARKETABLE RESERVES : 105.8 Mt
Proven Reserves : 82.3 Mt
Probable Reserves : 23.5 Mt

Located approximately 30km west of the township of Wandoan, the Elimatta project has been confirmed as a large resource of low ash, high volatile thermal coal. Since completion of Northern Energy's initial mine assessment in December 2008 further evaluation of the Elimatta deposit has continued.

A detailed life of mine plan has been developed for the deposit, incorporating the results of surface hydrology and geotechnical studies completed in late 2008. A reconfiguration of the mine layout and mining direction followed redesign and retiming of the proposed diversion of Horse Creek following completion of the hydrological studies.

As a result, the mine commences in lower strip ratio areas which reduces the area required for external overburden dumps. These changes have enabled a higher rate of production than assumed in the previous mine plan. The combination of these factors and the relaxation of the previously applied 5:1 strip ratio cut off has resulted in a larger total mine production and increase in reserves.

The Elimatta open cut mine plan is based on an excavator and truck mining operation feeding a 1,100 tph, 2 stage coal processing plant. A nominal 5 million tonnes of product coal per annum will be produced over a 20-plus year mine life. The 5Mtpa mine plan extracts approximately 170Mt of the total Elimatta Resource.

A Mining Lease Application (MLA 50524) has been lodged over Elimatta EPC 650 and the Company is awaiting establishment of formal Terms of Reference for a supporting Environmental Impact Statement which will be completed during 2010. Final feasibility studies for mining, wash plant and supporting infrastructure are underway. Infrastructure commitments are required in the first half of 2010 with first shipments scheduled for mid-2013.