Photo by: Bloomberg
PERTH (miningweekly.com) – Coal developer Atrum Coal has signed a $100-million financing agreement with State-owned China Coal Technology & Engineering Group to fund mining equipment for the Groundhog project, in Canada.
Stage 1 of the financing package includes the supply of roadheaders, mobile diesel equipment, conveyor systems, continuous miners, shuttle cars, mobile bolters, a mini wall mining unit, and the first stage of a modular coal handling and preparation plant.
The finance package could be drawn down in stages to facilitate the phased development of the Groundhog project. Atrum said on Monday that the agreement would help the company complete initial small-scale mining, and subsequent mini wall development at Groundhog North.
“This is a landmark agreement for the company and significantly de-risks our funding requirements. Through this facility, we have the plant and equipment required to deliver the bulk sample mine upgrade to a small-scale mine, and further ramp up and progress around 1.5-million tonnes a year run-of-mine production of the full-scale mine,” said Atrum VP for operations Ben Smith.
He noted that long-lead items would be ordered during the first half of 2015.
Atrum expected to receive its bulk sample mining licence at Groundhog for the first 100 000 t during the first half of this year, and this permit, combined with the production finance package would facilitate maiden anthracite shipments to Asian export customers later this year, Smith said.
The company was also in discussions with a number of resource specialist private equity funds, as well as strategic offtake partners in Japan and Korea, for direct equity investment into Groundhog North.
The Groundhog North project, which covered less than 5% of Atrum’s broader Groundhog anthracite project, and which was estimated to host some 1.57-billion tonnes of resource, was expected to deliver about 5.4-million tonnes of coal a year.