Second Annual Report Combined Reporting GR347 Hale River Project for the year 4 January 2014 to 3 January 2015

Abstract

Mineral Exploration Licences (EL) 29239 and 29237 were granted to Ebony Coal Ltd (Ebony) on January 4, 2013 for a term of 6 years. Ebony Coal Ltd changed name to Ebony Energy Limited (Ebony) on 11 December 2014. These two ELs are the southern tenements of the Hale River Project. Ebony is exploring for unconventional energy sources in the Pedirka Basin. The 2014 work programme was focused on the southwest corner of EL 29239 which is located about 230km southeast of Alice Springs. EL 29239 comprises 202 sub-blocks (604.22 sq. km) and adjoins the north boundary of EL 29237. EL 29237 comprises 187 sub-blocks (580.61 sq. km).During the Y-2 reporting period the work programme comprised of further desktop studies and the completion of one borehole, DH-1R. This was a proof of concept drill hole to determine coal seam thicknesses and gather samples for coal analysis and samples of interburden for porosity and permeability measurements. Borehole DH-1R consisted of HQ open-hole, PDC and HQ diamond coring. The first borehole DH-1 was abandoned at a vertical depth of 102 metres. DH-1R was drilled 3 metres from DH-1 to a depth of 622 metres. Drilling conditions were challenging and the planned depth of 840 metres was not reached. DH-1R did not penetrate the entire Pedirka Basin sequence. However, DH-1R was successful, intersecting four significant coal seams, two of which exceeded 10 metres in thickness: Seam D, 11.5m & Seam F, 10.4m. Other significant seams were E, 2.5m and G 7.7m. DH-1R was logged by Precision Energy Services (Aust) Pty Ltd. Twelve core samples of coal were sent for analysis and six core samples of sediment were sent for porosity and permeability measurements. A Borehole Report was prepared by Tamplin Resources Pty and is an Attachment to this report. A map locating DH-1R is shown in Figure 1. Planning for further Stage-2 drilling activities during 2015 has started. Stage-2 will focus on progressing towards a JORC compliant resource and gathering of hydrological data.