MCG Resources was granted EPC1560 on 3 July 2009.

The tenement is located approximately 15km north east of the township of Marlborough in Central Queensland, within the Rockhampton Regional local government area.

The Bruce Highway lies approximately 13km south west the tenement. Access to the tenement area from the south is from the Stanage Bay Road.

A medium capacity rail corridor also exists approximately 13km south west the tenement, connecting through to the Dalrymple Bay Coal Terminal. The distance from this point to the port facility is approximately 200km.

Geology
Little is known about the region in terms of coal bearing potential. Based on an historical data search, MCG Resources propose a theory that there is possible connection between the western side of the Stanage  Peninsula and the Styx Basin.

Styx Basin Structure and Setting

The Styx Basin is a small Early Cretaceous intracratonic sag basin straddling the central Queensland coast near the town of St Lawrence. The basin covers an area of approximately 300 km2 onshore and 500 km2 offshore, under water depths of up to 100 metres. The maximum known thickness of sediments is 387 metres from a coal exploration bore, but magnetic data suggest a thickening offshore.

Figure 7 – Styx Basin Locality Map

Initial Target Drilling Program Oct 09

MCG Resources conducted a 5-hole Initial Target Drilling Program on EPC1560 in October 2009. The purpose of the small exploration program was to confirm if there was any evidence of a geological setting similar to that found in the Styx Basin.

All 5 holes drilled encountered material consistent with the Tertiary Zone of the Styx Basin Stratigraphy, confirmed by the presence of carboniferous mudstones, shales and coaly shale.

A secondary drill program is proposed to be conducted in the 2nd quarter of 2010.

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