Quarterly Activities and Cashflow Reports
Perth, April 30, 2013 AEST (ABN Newswire) - Coalspur Mines Limited (
ASX:CPL) (TSE:CPT) is pleased to present its quarterly report for the three months ending 31 March 2013.
Highlights:
On 19 April 2013 Coalspur announced it concluded an arrangement to fund the majority of Stage 1 of its Vista Coal Project ("Vista"). Highlights include:
- EIG Global Energy Partners ("EIG") to provide a senior secured debt facility of up to US$350 million (the "Facility"). The Facility is expected to fund the majority of development capital for Stage 1 of Vista, which is estimated to be C$445 million.
- EIG increased the amount of the Facility to up to US$350 million, an increase of US$50 million from the previous announcement on 20 December 2012.
- The arrangement enables Coalspur to retain all off-take and marketing rights which allows it to preserve strategic flexibility and extract greater value for Coalspur shareholders in the future. Coalspur will also retain 100% ownership of Vista as part of this transaction.
- Access to the Facility maintains the development schedule of Vista with anticipated construction in mid-2013 and first production in 2015.
- Highland Park continued to show support of the Company by allowing C$30 million of the C$40 million debt currently outstanding to remain in the Company as subordinated debt.
Mr. Colin Gilligan was appointed to Chief Operating Officer ("COO") of Coalspur effective 1 April 2013.
Mr. Gilligan will be responsible for the development of all stages of Vista as well as technical and operating aspects of the mine.
- Mr. Gilligan brings 24 years of mining experience to Coalspur, having been involved in the development and operation of major operations internationally.
- Prior to this appointment, Mr. Gilligan served as the COO of Mitsui Coal holdings Pty Ltd. where he oversaw annual production of 12 million equity tonnes of coal, from eleven joint venture operations.
The Company announced the appointment of Mr. Richard Tremblay as Vice President, Operations, effective 18 March 2013, to lead Vista into commissioning and production.
- Mr. Tremblay will be responsible for preparing Vista for commissioning and running the mine once it is operational. Mr. Tremblay will oversee the safety and effectiveness of the operations, all environmental and health matters, production control and staff functions at Vista.
- Mr. Tremblay has 22 years of experience in the industry and joined Coalspur from Teck Coal where he held a number of senior roles, including that of General Manager of their Fording River Coal operation.
Coalspur announced that it has reached a definitive agreement (the "Agreement") with CN Rail ("CN") for the transportation of thermal coal from Vista to Ridley Terminals Inc., as well as the final agreement with CN regarding the construction of the rail siding to serve the mine.
- The key elements of the Agreement are consistent with the terms announced by Coalspur on 14 December 2012 and include transportation of up to 12 million tonnes per annum of coal; and defined rates with agreed escalation and fuel surcharge calculations.
- As a result of signing the Agreement, total FOB costs for Vista are projected to be C$56.98 per tonne in the first five years of production, C$59.55 per tonne in the first ten years of production and C$66.40 per tonne over the life of the mine.
- Coalspur and CN also signed an agreement which will govern the construction of a 6.5km long rail siding providing CN access to Coalspur's loading site. Subject to regulatory approval rail construction activity is expected to begin in Q3, 2013 and be completed in early 2015.
The Company announced that its largest shareholder, the Highland Park Group ("Highland Park"), as well as other smaller optionholders, had exercised their options to purchase additional ordinary shares in the company.
- Highland Park exercised 12,724,669 options at an exercise price of A$0.70 per option, and now owns 153,840,202 ordinary shares which represents approximately 24.3% of the ordinary shares currently outstanding in the Company.
- Holders of a further 669,333 options with an exercise price of A$0.70 per option also exercised their options to acquire further shares.
- Total funds raised from the exercise of options were A$9,375,801 the funds were received as of December 31, 2012 and the shares were issued in January 2013.
Going Forward
The Company is currently focusing on the efforts necessary to finalize the Facility and commence construction on Vista. Activities in the coming months are expected to include:
- Continued pursuit of regulatory approvals which are required to commence forest clearing, site grading, water management structures and other construction activities;- Satisfy various conditions of the Facility, including holding a meeting of Shareholders to vote on arrangements;
- Finalize the contracting and procurement strategy for Vista Stage 1 to enable construction to commence as planned;
- Award contracts for the civil earthworks and mine pre-development work;
- Discussions to secure additional investment / funding and off-take arrangements for Vista; and
- Continued discussions with mining contractors.
To view the full quarterly report, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-CPL-633461.pdf
About Coalspur Mines Limited
Coalspur Mines Limited (ASX:CPL) (TSE:CPT) is a coal development company with approximately 55,000 hectares of coal leases located within the Hinton region of Alberta, Canada. Coalspur's flagship project is Vista, which covers approximately 10,000 hectares and provides a large scale, surface mineable, thermal coal development. Vista is located adjacent to CN Rail's main line, which is suitable for the transport of coal to deepwater ports on Canada's west coast. Coalspur has secured a port allocation agreement with Ridley Terminals Inc., which is essential to the logistics supply chain necessary to export coal from Vista to the growing demand from the Asia Pacific countries.
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