SOURCE: Waratah Coal Inc.

November 21, 2007 12:55 ET

New Exploration Permits Granted to Waratah Coal in Galilee Basin on Extensions to Recently Announced 2.145 Billion Tonne Inferred Resources

Waratah Coal Extends Dominant Tenement Position in Premier Undeveloped Coal Province, World Coal Price Outlook Encouraging as Asian Economies Seek Unprecedented Levels of Long Term and Reliable Energy Sources

BRISBANE, AUSTRALIA and VANCOUVER, BC--(Marketwire - November 21, 2007) - Waratah Coal Inc (TSX-V: WCI) advises it has been granted two (2) new exploration permits in the Galilee Basin in Queensland, Australia. The permits known as EPC 1079 (Alpha Extended) and EPC 1080 (Laglan) flank the western boundaries of Waratah Coal tenures EPC 1040 (South Alpha), EPC1039 (Pocky Creek) and EPC 1053 (North Alpha).

Waratah recently announced an Inferred Resource of 1.470 Billion tonnes of thermal coal in EPC 1040 and 0.675 Billion tonnes of thermal coal in EPC 1053. The southern extension of the EPC 1053 resource is currently being drilled and will extend west into EPC 1039 shortly. A third party currently holds a 2.1 Billion tonne resource between EPC 1040 and EPC 1053. EPC 1079 also flanks this resource to the west.

The granting of these new EPCs will allow Waratah to track the extent of the known current resources, including the Hancock Prospecting P/L resource, further down dip. As current drilling indicates a benign structural environment with the coal seams dipping 0.5% to the west, Waratah believes that further resources at reasonable mining depths are highly likely.

Waratah Coal now has a total of 5 EPCs granted which cover an area of 2,577km2 in the Galilee Basin. A further 4 applications are pending. Waratah Coal is the largest resource tenure holder in this newest coal province of Australia.

Whilst Waratah continues to expand the known resource the company is also currently investigating options to develop this province to deliver world class tonnage production. This scoping study includes high volume rail and port options as well as "coal to oil" and domestic power generation options.

Waratah believes the global physical demand and price outlook for thermal coal is robust and augers well for a future resource development on the area.

The key drivers for Waratah include:

* High world energy pricing, export thermal coal prices in Newcastle last
  week hit an all time record of US$83.75/ tonne (source Barlow Jonker)
* Sustained worldwide demand for coal (China will double it installed coal
  fired electrical generating capacity over the next 20 years)
* High quality coal product compared to alternate sources
* Huge coal resource base still expanding should allow low operating cost,
  high tonnage operations similar to iron ore development in Western
  Australia
* Structurally benign deposit suitable for high production opencut mining
  and high production longwall mining at depth
* Low sovereign risk for investment in Australia
* Australian coal miners are at the forefront of expertise, innovation
  and mining technology

Waratah Coal's Galilee Basin Exploration Permits Coal (EPCs) can be viewed at the company web site at the following link: http://www.waratahcoal.com/images/alpha%2010%2006-007%20EPC%201039%201040%201053%20(5).jpg

Galilee Basin Coal Characteristics, Geology and Exploration Summary

The five principal coal seams in the Alpha area are sub-bituminous high volatile perhydrous coals suitable for use as thermal coal and potentially liquefaction, gasification and other petrochemical applications. Historical open-hole or partially cored drill holes were drilled by a Shell Development Australia Pty Ltd and Western Mining Corporation Limited joint venture between 1974 and 1976, with one fully-cored hole drilled by Queensland Department of Mines in 1972. Waratah has drilled some 70 chip and partly cored holes to date on EPCs 1040 and 1053 and drilling continues with 5 rigs currently. A further 3 rigs will be deployed following the granting of these new EPCs.

All recent and past boreholes were logged using down-hole geophysical sondes including gamma ray, density, calliper and neutron. These logs accurately determined the seam correlation and seam thickness in all boreholes. SSL and ACIRL Laboratories have analysed the core samples for Raw Proximate Analysis, Specific Gravity, Total Sulphur and Calorific Value, as well as Washability Analysis, Ultimate Analysis, Ash Fusion Temperatures, Hardgrove Grindability Index, Ash Analysis, and Arsenic, Chlorine & Phosphorous levels.

A Map showing Waratah Coal's most recently granted EPC 1053 and the 675Mt inferred resource can be seen at the following link: http://www.waratahcoal.com/images/alpha%2010%2006-007%20EPC%201039%201053%20(6).jpg

Geologically, the Galilee Basin covers an area of 247,000 square kilometres in central Queensland and is entirely intracratonic, filled with Late Carboniferous to Middle Triassic sediments. These rocks are dominantly fluvial in origin with minor glacial material developed at the base of the succession. The Galilee Basin contains extensive coal deposits, largely at depth except for the eastern margin, where the Waratah Coal North Alpha project lies. The basin is almost entirely unconformably overlain by the Jurassic - Cretaceous Eromanga Basin, with the eastern margin of the basin being the only exposed component of the Permo - Triassic sequence.

Exploration of ground to the south of EPC 1053 in the 1970s by companies including Bridge Oil, and the Australian-based subsidiaries of Total, Cogema and Charbonnage de France identified a measured and indicated coal resource of 2.1 billion tonnes. This resource is owned by Hancock Prospecting Pty Ltd, from Queensland Coal Resource Inventory, Queensland Coals 14th Edition 2003, Queensland Government, Department of Natural Resources and Mines.

Waratah's drilling in EPC 1079 and EPC 1080 will focus on expanding the size of the two known resources In EPC 140 and EPC 1053 to the west.

Comment

Waratah President and Chief Executive Officer Peter Lynch said the new permits would allow the company to formally begin drilling on the western flank of its Galilee Basin interests. "The granting of EPC 1079 and EPC 1080 is an important development for Waratah and marks the expansion of drilling activity on the western or down dip flank at our licences in the Galilee Basin," Mr. Lynch said. "Recent work strengthens our confidence that our properties contain a world class resource of marketable, export-quality thermal coal."

Mr. Lynch said that, in conjunction with the drilling program, Waratah would begin examining a range of options for infrastructure to transport the coal. The first priority is to demonstrate the project is of sufficient potential to underwrite the necessary rail and port infrastructure.

The Qualified Person for the resource estimates quoted is Mr. Patrick Hanna, Fellow of the AusIMM and Principal Coal Geology Consultant with SRK Consulting, who provided 43-101 compliant statements for all resources in September and October 2007.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • For further information:
    Peter Lynch
    Waratah Coal
    President and CEO
    T: +61 7 3303 0692
    E-mail: Email Contact

    Henry Wright
    T: (604) 681-5755
    E-mail: Email Contact