coal seam gas and coal gasification

I was just reviewing my interest in STX and decided to investigate in a little more detail the Kingston Lignite investment belonging to STX.

In the current environment of investor and environmental interest in such technologies as CBM and CSG, the purchase in 2005 of 100% of this asset in retrospect looks like an enormous coup. We are talking a 1bn tonne resource of brown coal which was estimated by the previous owner Western Mining before the JORC standard was introduced.

STX is investigating how this asset can be commercialised. I don't know what it is worth but I bet there are many players that would be clamouring to farm in to this. The resource is strategically located close to the Melbourne Adelaide gas pipeline, midway between the two cities. It is close to the power grid and the aluminium smelter at Portland. STX has ample background experience in Coal Seam Gas having spun off Comet Ridge (former partner of AOE in Tipton West) a few years ago.

The strike extent of the Kingston brown coal is of the order of 40-50kms. I would be very interested from any experts in CSG and CBM as to what intrinsic value this asset may have in the current market for such assets.

The details are available on the company's web site at
http://www.strikeoil.com.au/?pg=operations§ion=17

Is this a hidden gem? I venture that the company (and us shareholders) could get plenty of mileage from increasing their spend on this asset.

regards
DF