British Colombia, Canada-based diversified miner Thelon Capital Ltd has announced that it has signed a letter of agreement to lease or purchase the Jellico coal project, which consists of approximately 6,000 acres of fee simple land in the Campbell and Claiborne counties, located approximately thirty-five miles north of Knoxville, Tennessee, US.
According to a Thelon press release, under the terms of the agreement, Thelon shall issue 3.5 million shares and spend US$750,000 on confirmation drilling to generate and complete a national instrument compliant resource report. Thelon shall issue an additional 3.5 million shares, (i) upon the signing of a definitive agreement, (ii) the successful completion and receipt of the compliant resource report demonstrating a measured and indicated aggregate coal resource of not less than 20 million mt of sufficient quality and thickness to be conventionally mined.
Portions of the property have had extensive sampling and drilling by previous operators as recently in 2009 and it is thought to contain multiple coal seams of high quality metallurgical, as well as compliant steam coals.