If so, Eneabba said it could provide an alternative fuel supply for the plant's gas-fired turbines at a more economical cost.

Initial results from composite seam analysis of the thicker coal seams intersected during last year's drilling program were encouraging, according to Eneabba.

The analysis, undertaken by the Cooperative Research Centre for Coal in Sustainable Development (CCSD), noted that: "...the proximate volatile matter content of the samples in your analyses place the coals in a similar range to a number of coals we have tested successfully in the CCSD program..."

However, additional exploration drilling and samples are required to further define these initial results.

Eneabba said it planned to lodge its 2008 exploration programme with the Department of Industry and Resources next month in order to secure approvals for the drilling and sampling of the target areas later this year.

The initial analysis was carried out on limited samples. Bulk sampling is now required to enable laboratory-based volume tests and also pilot testing for the next stage.

Coal gasification is one of the three principal technologies for producing energy from coal that allows the capture and storage of carbon dioxide.

Instead of burning coal to produce heat and make steam, gasification produces hydrogen gas and pure CO2 - the hydrogen can then be used to produce electricity, while the CO2 can be buried using geosequestration.