QGX Ltd.
TSX : QGX

QGX Ltd.

November 03, 2005 07:00 ET

QGX Finds New Seams with Indicators of Metallurgical 'Coking' Coal at Baruun Naran Project

WATERDOWN, ONTARIO--(CCNMatthews - Nov. 3, 2005) -

Not for distribution to United States newswire services or for dissemination in the United States.

Laboratory Results Also Continue to Substantiate Seams "H" and "T" as
Metallurgical-Grade Coal

QGX Ltd. (TSX:QGX) is pleased to announce that a compilation of new and old metallurgical test results from eight additional dill holes at Baruun Naran has indicated that Seam "P" and three unassigned coal intercepts show indicators of metallurgical ("coking") coal. In addition, these laboratory results further substantiate metallurgical-grade properties for coal in Seams "H" and "T". As expected, Seams "G" (formerly Seam "N") and "F" (formerly Seam "O") did not return metallurgical qualities (see press release of August 30th) and show instead characteristics of a good thermal ("steaming") coal. In addition to Seams "G" and "F", Seams "Q" and "R" also returned favorable thermal coal properties. For a summary of the test results for these coals, please see Tables 1a-c and 2a-c below.

David Anderson, CEO of QGX, commented as follows:

"We are delighted to have found a third seam, Seam "P", with metallurgical-grade properties. We are also pleased that lab results from three other unassigned coal intercepts indicate metallurgical characteristics. None of these intercepts have been assigned a seam designation. We look forward to delineating Seam "P" and these other unassigned metallurgical-grade intercepts as part of our ongoing development of Baruun Naran.

We are also pleased that Seams "H" and "T" have consistently returned metallurgical properties from laboratory analyses. These new results confirm the earlier numbers obtained in Holes BN05001 and -02, increasing our confidence in the project."

Main Points Include:

1) Key metallurgical tests indicate that three "unassigned" intercepts yield indicators of metallurgical-grade coal (see data highlighted in bold in Tables 1c and 2c).

a. The "unassigned" intercept in Hole BN05003 (45.34-51.90 m) contains the most outstanding values with all tests returning metallurgical-grade values. These values are higher than the average values measured for metallurgical-grade Seam "T" (cf. Tables 2b and 2c).

b. Seam "P" demonstrates metallurgical-grade indicators from one coal interval contained in Hole BN05003 (97.10-106.60 m).

c. Holes BN05005 and -06 each show values indicating favorable metallurgical properties for the unassigned intercepts.

2) Seams "H" and "T" continue to yield values indicating metallurgical grade (see Tables 1a-2a and 1b-2b, respectively).

3) Seams F, G, Q, and R yielded good thermal characteristics with rank ranging from mid-volatile bituminous (mvb; the highest ranking coal so far discovered at Baruun Naran) to high-volatile B bituminous (mvBb). They contain moderate-to-high calorific values (5,927-9,921 BTU/lb, on an "as received" basis), but contain too much ash (26.05-51.97%, on an "as received" basis) to be suitable for metallurgical use.

4) The results for the other unassigned coal intercepts, not reported in the tables, show the following coal-quality characteristics:

a. Rank: range from high-volatile A bituminous to high-volatile C bituminous (hvAb-hvCb),

b. Ash: contain moderate to moderately high amounts of ash (26.05-56.16% on an "as received" basis; 9.22-27.61% on a "dry" basis-washed), with approximately half containing less than 40% ash on an "as received" basis.

c. Sulphur: "clean" coal with low amounts of sulphur (0.44-1.39% on a "dry" basis-washed)

d. Calorific Value: moderate heat content (4,797-9,387 BTU/lb on an "as received" basis).

The coal contained in Seams "H", "T", "P" and the three unassigned seams are of the most interest. These seams are high-volatile A or B bituminous (hvAb-Bb) based on the ASTM standards (see Tables 1a, b, c) and show metallurgical properties. High-volatile coals are common in the export market and are often blended with low- or mid-volatile coals depending on specific customer requirements.



Table 1a. Coal Rank and Washability Data for Seam "H", Baruun Naran
------------------------------------------------------------------------
Drill-Hole Sample Interval
Number (m) Unwashed Composite
------------------------------------------------------------------------
Btu/lb
(Moist, Volatiles
Ash BTU/lb mmf) (MAF) Rank
From To (% AR) (AR) (ASTM) (ASTM) (ASTM)
------------------------------------------------------------------------
Parameter Range(1): Min
Max-Min 13,000 20-35 hvBb-lvb
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05001 34.40 57.00 21.11 10,931 14,581 31.18 hvAb
------------------------------------------------------------------------
BN05014 41.80 59.60 15.85 11,381 14,398 32.40 hvAb
------------------------------------------------------------------------
BN05014 68.00 72.10 20.43 11,352 14,644 31.94 hvAb
------------------------------------------------------------------------
BN05014 74.65 77.05 32.16 8,748 13,642 34.79 hvBb
------------------------------------------------------------------------
BN05014 78.65 82.90 20.87 11,107 14,787 32.54 hvAb
------------------------------------------------------------------------
Weighted Average 19.72 11,034 14,495 31.95 hvAb
------------------------------------------------------------------------
------------------------------------------------------------------------


------------------------------------------------------------------------
Drill-Hole Sample Interval
Number (m) Washability at 1.4 g/cc Float
------------------------------------------------------------------------
Cumulative Ash
Recovery (% Dry) Sulphur BTU/lb
From To (%) (2) (% Dry) (Dry)
------------------------------------------------------------------------
Parameter Range(1): 12,000
Max-Min Max 12 Max 1.0 -15,000
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05001 34.40 57.00 71.90 13.72 1.03 13,228
------------------------------------------------------------------------
BN05014 41.80 59.60 59.40 14.69 1.22 12,862
------------------------------------------------------------------------
BN05014 68.00 72.10 27.10 9.25 0.69 13,830
------------------------------------------------------------------------
BN05014 74.65 77.05 2.80 11.56 1.26 13,398
------------------------------------------------------------------------
BN05014 78.65 82.90 10.10 14.08 0.82 12,974
------------------------------------------------------------------------
Weighted Average 55.58 13.63 1.06 13,136
------------------------------------------------------------------------
------------------------------------------------------------------------


Table 1b. Coal Rank and Washability Data for Seam "T", Baruun Naran
------------------------------------------------------------------------
Drill-Hole Sample Interval
Number (m) Unwashed Composite
------------------------------------------------------------------------
Btu/lb
(Moist, Volatiles
Ash BTU/lb mmf) (MAF) Rank
From To (% AR) (AR) (ASTM) (ASTM) (ASTM)
------------------------------------------------------------------------
Parameter Range(1): Min
Max-Min 13,000 20-35 hvBb-lvb
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05002 18.70 42.30 12.97 11,897 14,001 34.45 hvAb
------------------------------------------------------------------------
BN05008 144.70 165.35 21.29 10,195 14,165 33.37 hvAb
------------------------------------------------------------------------
BN05009(3) 10.50 17.20 20.55 4,482 6,415 46.82 wxd
------------------------------------------------------------------------
BN05009(3) 17.20 30.85 11.25 8,843 11,260 35.93 sli wxd
------------------------------------------------------------------------
BN05009 30.85 37.50 26.37 9,199 13,730 35.54 hvBb
------------------------------------------------------------------------
BN05009 121.17 122.90 33.62 8,467 13,888 50.51 hvBb
------------------------------------------------------------------------
BN05009 122.90 137.50 10.77 12,340 14,388 34.46 hvAb
------------------------------------------------------------------------
BN05009 137.50 139.75 18.83 10,844 14,386 33.22 hvAb
------------------------------------------------------------------------
Weighted Average 16.97 11,107 14,115 34.59 hvAb
------------------------------------------------------------------------
------------------------------------------------------------------------


------------------------------------------------------------------------
Drill-Hole Sample Interval
Number (m) Washability at 1.4 g/cc Float
------------------------------------------------------------------------
Cumulative Ash
Recovery (% Dry) Sulphur BTU/lb
From To (%) (2) (% Dry) (Dry)
------------------------------------------------------------------------
Parameter Range(1): 12,000
Max-Min Max 12 Max 1.0 -15,000
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05002 18.70 42.30 86.90 9.06 0.85 13,724
------------------------------------------------------------------------
BN05008 144.70 165.35 59.80 18.91 0.80 11,497
------------------------------------------------------------------------
BN05009(3) 10.50 17.20 17.60 40.56 0.30 6,232
------------------------------------------------------------------------
BN05009(3) 17.20 30.85 84.90 11.90 0.59 11,701
------------------------------------------------------------------------
BN05009 30.85 37.50 33.70 15.95 0.99 12,346
------------------------------------------------------------------------
BN05009 121.17 122.90 21.30 17.11 0.63 12,368
------------------------------------------------------------------------
BN05009 122.90 137.50 83.70 8.52 0.89 13,707
------------------------------------------------------------------------
BN05009 137.50 139.75 61.00 11.98 1.03 12,941
------------------------------------------------------------------------
Weighted Average 70.61 12.83 0.86 12,868
------------------------------------------------------------------------
------------------------------------------------------------------------


Table 1c. Coal Rank and Washability Data for Other Seams and Coal
Intercepts, Baruun Naran
------------------------------------------------------------------------
Drill
-Hole Sample
Number Interval (m) Seam Unwashed Composite
------------------------------------------------------------------------
Btu/lb Vola-
Ash (Moist, tiles
(% BTU/lb mmf) (MAF) Rank
From To AR) (AR) (ASTM) (ASTM) (ASTM)
------------------------------------------------------------------------
Min hvBb-
Parameter Range(1): Max-Min 13,000 20-35 lvb
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05010 250.50 257.53 R 29.80 9,765 14,110 34.12 hvAb
------------------------------------------------------------------------
BN05010 75.90 95.70 Q 26.05 9,921 13,881 35.75 hvBb
------------------------------------------------------------------------
BN05010 104.80 110.65 Q 51.97 5,927 13,311 32.78 hvBb
------------------------------------------------------------------------
BN05003 97.10 106.60 P 23.93 10,441 13,361 32.92 hvBb
------------------------------------------------------------------------
BN05014 201.36 206.55 G 31.29 9,643 14,456 32.35 hvAb
------------------------------------------------------------------------
BN05014 247.40 255.77 F 39.38 7,795 13,290 29.02 mvb
------------------------------------------------------------------------
BN05003 45.34 51.90 Unassigned 37.91 7,586 13,454 34.76 hvBb
------------------------------------------------------------------------
BN05005 79.40 81.80 Unassigned 36.32 8,455 NT NT NT
------------------------------------------------------------------------
BN05006 140.50 146.10 Unassigned 27.25 9,203 NT NT NT
------------------------------------------------------------------------
------------------------------------------------------------------------


------------------------------------------------------------------------
Drill
-Hole Sample
Number Interval (m) Seam Washability at 1.4 g/cc Float
------------------------------------------------------------------------
Cum. Ash
Rec. (% Dry) Sulphur BTU/lb
From To (%) (2) (% Dry) (Dry)
------------------------------------------------------------------------
Max Max 12,000-
Parameter Range(1): Max-Min 12 1.0 15,000
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05010 250.50 257.53 R 13.7 11.16 0.78 13,206
------------------------------------------------------------------------
BN05010 75.90 95.70 Q 22.4 10.53 0.64 13,486
------------------------------------------------------------------------
BN05010 104.80 110.65 Q 3.5 12.59 0.84 13,030
------------------------------------------------------------------------
BN05003 97.10 106.60 P 54.70 11.19 0.71 13,492
------------------------------------------------------------------------
BN05014 201.36 206.55 G 4.90 12.63 0.83 13,352
------------------------------------------------------------------------
BN05014 247.40 255.77 F 0.50 9.22 0.60 13,810
------------------------------------------------------------------------
BN05003 45.34 51.90 Unassigned 52.00 17.03 0.66 12,625
------------------------------------------------------------------------
BN05005 79.40 81.80 Unassigned 34.10 11.56 0.78 13,242
------------------------------------------------------------------------
BN05006 140.50 146.10 Unassigned 48.10 11.20 0.55 12,865
------------------------------------------------------------------------
------------------------------------------------------------------------

Abbreviations: AR = As received; ASTM = American Society for Testing and
Materials; Btu/lb = British thermal unit per pound; Cum.
Rec. = Cumulative recovery; MAF = Moisture-ash free;
Max = Maximum; Min = Minimum; mmf = Mineral matter free;
NT = Not tested; sli wxd = Slightly weathered;
wxd = Weathered

Abbreviations for Coal Rank: hvCb = High volatile C bituminous;
hvBb = High volatile B bituminous;
hvAb = High volatile A bituminous;
mvb = Medium volatile bituminous;
lvb = Low volatile bituminous

Footnote 1: General range of values for metallurgical coals as estimated
by Norwest Corporation
Footnote 2: Ash content may be improved through selective mining and the
removal of inferior quality horizons
Footnote 3: Weathered samples - values not included in weighted averages

Note: Seams in Table 1c listed stratigraphically from high (e.g.,
Seam R) to low (e.g., Seam F)


Table 2a. Metallurgical Properties for Seam H, Baruun Naran
------------------------------------------------------------------------
Seam Interval (m) Metallurgical Properties
------------------------------------------------------------------------
Max Dilato-
Drill- Free Fluidity meter Mean-Max Phos-
Hole Swelling Gieseler Dilation Reflectance phorous
Number From To Index (DDPM) (% Max) (% in Oil) (% Dry)
------------------------------------------------------------------------
Parameter Range (1): 100- Max
Min - Max 4-8 10,000 50-200 0.7-1.8 0.20
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05001 34.40 57.00 5.0 1,589 +45 1.02 0.09
------------------------------------------------------------------------
BN05014 41.80 59.60 6.0 535 -6 1.01 0.01
------------------------------------------------------------------------
BN05014 68.00 72.10 8.0 1,467 +117 1.02 0.01
------------------------------------------------------------------------
BN05014 74.65 77.05 NT NT NT NT NT
------------------------------------------------------------------------
BN05014 45.34 51.90 NT NT NT NT NT
------------------------------------------------------------------------
Weighted Average 5.7 1,156 31 1.02 0.05
------------------------------------------------------------------------
------------------------------------------------------------------------


Table 2b. Metallurgical Properties for Seam T, Baruun Naran
------------------------------------------------------------------------
Seam Interval (m) Metallurgical Properties
------------------------------------------------------------------------
Max Dilato-
Drill- Free Fluidity meter Mean-Max Phos-
Hole Swelling Gieseler Dilation Reflectance phorous
Number From To Index (DDPM) (% Max) (% in Oil) (% Dry)
------------------------------------------------------------------------
Parameter Range (1): 100- Max
Min - Max 4-8 10,000 50-200 0.7-1.8 0.20
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05002 18.70 42.30 6.0 1,383 -10 0.96 0.05
------------------------------------------------------------------------
BN05008 144.70 165.35 4.0 549 -13 0.97 0.02
------------------------------------------------------------------------
BN05009(3) 10.50 17.20 NT NT NT NT NT
------------------------------------------------------------------------
BN05009(3) 17.20 30.85 0.0 0 -6 0.86 0.01
------------------------------------------------------------------------
BN05009 30.85 37.50 5.0 429 -14 0.83 0.05
------------------------------------------------------------------------
BN05009 121.17 122.90 6.5 1,455 +6 0.91 0.05
------------------------------------------------------------------------
BN05009 122.90 137.50 6.5 1,085 -11 0.88 0.08
------------------------------------------------------------------------
BN05009 137.50 139.75 6.5 929 +5 0.94 0.01
------------------------------------------------------------------------
Weighted Average 5.5 968 -11 0.93 0.05
------------------------------------------------------------------------
------------------------------------------------------------------------


Table 2c. Metallurgical Properties for Other Seams and Coal Intercepts,
Baruun Naran
------------------------------------------------------------------------
Drill-Hole Sample
Number Interval (m) Seam Metallurgical Properties
------------------------------------------------------------------------
Max
Free Fluidity
Swelling Gieseler
From To Index (DDPM)
------------------------------------------------------------------------
Parameter Range(1): Max-Min 4-8 100-10,000
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05010 250.50 257.53 R NT NT
------------------------------------------------------------------------
BN05010 75.90 95.70 Q Pending Pending
------------------------------------------------------------------------
BN05010 104.80 110.65 Q NT NT
------------------------------------------------------------------------
BN05003 97.10 106.60 P 3.5 329
------------------------------------------------------------------------
BN05014 201.36 206.55 G NT NT
------------------------------------------------------------------------
BN05014 247.40 255.77 F NT NT
------------------------------------------------------------------------
BN05003 45.34 51.90 Unassigned 7.0 1,059
------------------------------------------------------------------------
BN05005 79.40 81.80 Unassigned 3.0 8
------------------------------------------------------------------------
BN05006 140.50 146.10 Unassigned 4.5 8
------------------------------------------------------------------------
------------------------------------------------------------------------


------------------------------------------------------------------------
Drill-Hole Sample
Number Interval (m) Metallurgical Properties
------------------------------------------------------------------------
Dilatometer Mean-Max Phos-
Dilation Reflectance phorous
From To (% Max) (% in Oil) (% Dry)
------------------------------------------------------------------------
Parameter Range(1): Max-Min Min 13,000 0.7-1.8 100-10,000
------------------------------------------------------------------------
------------------------------------------------------------------------
BN05010 250.50 257.53 NT NT NT
------------------------------------------------------------------------
BN05010 75.90 95.70 Pending Pending Pending
------------------------------------------------------------------------
BN05010 104.80 110.65 NT NT NT
------------------------------------------------------------------------
BN05003 97.10 106.60 -21 1.10 0.02
------------------------------------------------------------------------
BN05014 201.36 206.55 NT NT NT
------------------------------------------------------------------------
BN05014 247.40 255.77 NT NT NT
------------------------------------------------------------------------
BN05003 45.34 51.90 +51 0.95 0.00
------------------------------------------------------------------------
BN05005 79.40 81.80 -29 0.85 0.02
------------------------------------------------------------------------
BN05006 140.50 146.10 -22 0.88 0.02
------------------------------------------------------------------------
------------------------------------------------------------------------
Abbreviations: DDPM = Dial Divisions Per Minute; Min = Minimum;
Max = Maximum; NT = Not tested
Footnote 1: Range of values for metallurgical coals as estimated by
Norwest Corporation
Note: Seams in Table 2c listed stratigraphically from high (e.g.,
Seam R) to low (e.g., Seam F)


Mr. David Anderson, President/CEO of QGX Ltd. and the Qualified Person as defined by NI 43-101, has reviewed and approved the information contained in this release. Norwest Corporation (Salt Lake City) has reviewed and approved the data contained in Tables 1a-c and 2a-c. QGX has engaged Norwest to provide consulting services regarding the exploration and evaluation of the Baruun Naran coal deposit. Norwest has extensive coal experience in Mongolia including completing a feasibility study of the Tavan Tolgoi coal deposit for the Mongolian Ministry of Infrastructure and Development, providing advisory services to the operating coal mines at Shivee Ovoo and Bagaa Nuur, and overseeing coal exploration programs in Mongolia for other multi-national mining and exploration companies.

The Mineral Services Division of SGS North America, Inc. (Denver, Colorado) performed all of the laboratory analyses presented in Tables 1a-c and 2a-c.

About QGX

QGX is a Canadian-based company that has been exploring for mineral deposits in Mongolia since 1994. The Company holds a large area of exploration licenses throughout Mongolia. The Company's most advanced property is the Golden Hills prospect in western Mongolia. QGX has filed an independent NI 43-101 report outlining a resource containing approximately 3.3 million gold-equivalent ounces at the Central Valley Zone of Golden Hills (measured, indicated and inferred). Barrick Gold Corp. holds a 9.4% equity interest in QGX as part of a strategic relationship between the companies.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful. The securities have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

This press release includes certain "forward-looking statements". All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential mineralization, results and future plans and objectives of the Company are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.

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

Contact Information

  • QGX Ltd.
    David Anderson
    CEO
    (905) 689-9442
    or
    QGX Ltd.
    Paul Zweng
    COO
    (925) 855-0505
    Website: www.qgxgold.com