This report reviews the evolution of depositional environments for the Australian Permian sequence, particularly in regard to the formation of coal, and describes the interpreted nature of sedimentation in the Arckaringa Basin. The depositional history of this basin is compared with histories known for other Permian basins in SA, to construct a stratigraphic and environmental synthesis. Prospects for finding economic deposits of sub-bituminous coal in the Mount Willoughby area (EL 695) are seen as reasonable, although the coal is likely to occur at depth. 3 test drilling sites are recommended.