The strong three-month rally in Perth company Atrum Coal's share price was halted today, after the company unveiled a 460 per cent increase in resources at its flagship Groundhog anthracite deposit in British Columbia.
Atrum said drilling had revealed the total JORC-compliant coal resource at Groundhog had increased from 338 million tonnes to 1.57 billion tonnes, confirming it as one of the largest undeveloped high-grade anthracite deposits worldwide.
Technical director Eric Lilford said the size of the Groundhog deposit was “extraordinary”.
“The coal is generally shallow and exhibits an exceptionally high rank,” Dr Lilford said in a statement.
“As one of the largest undeveloped anthracite deposits in the world, Groundhog has the potential to be a strategic asset in the global metallurgical coal space.
Trading in Atrum shares appears to have been a case of 'buy the rumour, sell the fact'.
Atrum listed on the ASX in July last year, raising $9.1 million through its IPO, priced at 20 cents per share.
Its share price barely moved for six months, but started a strong rally in mid January and continued rising on the expectation of a large resource upgrade.
When the stock came out of a trading halt today, it briefly shot up to $1.32 before finishing 5 cents down at 97 cents.
The company said it would spend the remainder of 2013 focusing on reserve definition drilling, bulk sampling, quality analysis, engineering design, port access and environmental studies for the Groundhog development.
