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Mon, August 13, 2012 CanAm Obtains the Old Union II Permit and Acquires New Coal Leases Totaling 123 Acres
August 13, 2012 09:01 ET
CanAm Obtains the Old Union II Permit and Acquires New Coal Leases Totaling 123 Acres
CALGARY, ALBERTA--(Marketwire - Aug. 13, 2012) - CanAm Coal Corp. (TSX VENTURE:COE)(OTCQX:COECF) ("CanAm" or the "Company") is pleased to report on the issuance of a mining permit for the Old Union II mine and the acquisition of new coal leases.
Old Union II Permit
On August 8, 2012, the Company's subsidiary, Birmingham Coal & Coke ("BCC"), was issued permit # 3962 by the Alabama Surface Mining Commission ("ASMC"). This permit, also known as the Old Union II permit, allows the Company to start mining operations effective immediately. The Old Union II permit is a 5 year surface mining permit covering a total of 1,393 acres and 1,108 minable acres. The total recoverable tons of coal within the permit area is 1,274,750 tons. (See NI 43-101 report dated May 2011 on [ www.sedar.com ]). The Company has begun the mine development work and is targeting a September 2012 production startup. Annual production from the Old Union properties, which include the existing Old Union and the now permitted Old Union II mine sites, is forecasted at 360,000 to 400,000 tons per annum. To put this in context, Old Union mine production for the first 6 months of 2012 was approximately 110,000 tons.
The coal within the Old Union II mine complex is considered to have the same qualities/characteristics as the coal that is currently being mined from the existing Old Union mine. On average, the proximate analysis has indicated 9% ash, 1.0% sulfur and 12,400 BTU/lb. These average values are consistent with the assays reported from drilling; mine face sampling and product deliveries. (See NI 43-101 report dated July 2011 on [ www.sedar.com ]).
New Coal Leases
The Company is also pleased to report that BCC has acquired additional surface mining rights to two tracts of land totaling approximately 133 acres. These lands are an integral part of the Old Union and Old Union II mine complex and are in addition to the 574 acres of land acquired in the period April to June 2012 and previously announced in a press release dated July 10, 2012.
The first of the surface mining rights was acquired through Molag Timberprop, LLC through a surface mining lease. The lease consists of approximately 40 total acres with a management estimate of 23 mineable acres. The lease has a 3 year term and includes industry standard royalty provisions with no advance minimum royalties. This property is currently permitted and is within the Old Union mining complex.
The second surface mining lease is referred to by the company as the H.H. and Alice Kilgore property and will be added to the Old Union II mine permit. It consists of approximately 93 total acres with a management estimate of 64 mineable acres. The lease has an indefinite term that runs until the mining and reclamation are completed and includes industry standard royalty provisions with no advance minimum royalties. This is a key lease acquisition as, from a mine development and operating perspective, this property will allow for direct and easy access to the eastern portion of the Old Union II mine site from County Road 21.
"We are excited about our new Old Union II permit as it will allows us to expand our mining operations, increase our production of high quality thermal coal and continue to meet our customer commitments," said Tom Lewis, Vice President of BCC. "In addition, the acquisition of the Kilgore property will save us time and money as we avoid having to undertake a major bridge project."
About CanAm Coal Corp.
CanAm is a coal producer and development company focused on growth through the acquisition, exploration and development of coal resources and resource-related technologies. CanAm's main activities and assets include its coal operations in Alabama and the Buick Coal Project which holds significant coal resources, 188 million indicated and 103 million inferred resources, in Colorado, USA (see the technical report entitled "Limon Lignite Project, Elbert County, Colorado, USA," dated October 26, 2007 and filed on SEDAR on November 2, 2007). Other coal and related opportunities continue to be evaluated on an ongoing basis.
Forward-Looking Information and Statements
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release may contain certain forward-looking information. All statements included herein, other than statements of historical fact, is forward-looking information and such information involves various risks and uncertainties. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in the Company's disclosure documents on the SEDAR website at [ www.sedar.com ]. The Company does not undertake to update any forward-looking information except in accordance with applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
