Strategic Natural Resources

Recent interview of Jeremy Metcalfe, Communications Director of Strategic Natural Resources PLC

Interview with Jeremy Metcalfe, Communications Director

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Introduction

Strategic Natural Resources PLC (“SNR”) was established on 5 October 2004 as a vehicle to develop, own and manage natural resource extraction enterprises in Southern Africa. As its first project, SNR acquired control of Elitheni Coal in the Eastern Cape some 200 miles north east of Port Elizabeth. The principal assets of Elitheni are a new order mining right over 92 km2 as well as new order prospecting rights over an additional 1,700 km2 for coal which it holds in the Eastern Cape, South Africa.

History

The first mines near Molteno and Indwe were opened in 1864 and 1877. The annual coal output from these mines reached a peak between 1900 and 1904 when production averaged 176,000 tonnes per annum. With the discovery of large deposits of coal in the former Transvaal and Natal Provinces closer to where major industrial development had commenced, production declined sharply in 1917 and ceased altogether in 1948. However, the Directors believe that, with the development of CFB Combustion Technology as well as local advancements in boiler combustion and increasing electricity prices large scale mining in this area is now economically viable. A coal mine based in the Eastern Cape will fuel the growing demand for heat, power and steam in South Africa.

Elitheni coal and its licences

Elitheni has increased its prospecting rights area in the Eastern Cape province of South Africa by more than 2,000% from the initial Phase 1 and Phase 2 area of 9,283.80ha, granted in 2005, to practically 184,000ha today. The 184,000ha has been demarcated into Phases 1, 2, 3, 4 and 5. The latter having been named Project Indlovu. Full and exclusive new order mining rights have been obtained on Phase 1&2 (92 km2 area) and full and exclusive new order prospecting rights exist on the remaining Phases 3, 4 and 5 areas. New order prospecting rights give the holder the exclusive right to apply for and obtain mining rights over the area held.

The Company was admitted to AIM on 7th August 2007 on the basis of a resource under Elitheni’s control of approximately 15 million tonnes of coal in the Phase 1 and Phase 2 areas. Subsequent drilling confirmed by the Competent Persons Report ("CPR"), a resource of 97.2 million tonnes on an area of less than 5% of the whole in September 2008 and extractable sales tonnes of over 52 million.

Having all rights in hand to commence production, the Company has commenced 2010 with plans to fast track mine development and market penetration with first supplies to local industrial clients commencing in the first quarter 2010.