PERTH, Western Australia, Oct. 31, 2012 /CNW/ - Coalspur Mines Limited ("Coalspur" or "Company") (ASX: CPL, TSX: CPT) is pleased to present its quarterly report for the three months ending 30 September 2012.
- The Company completed a scoping study on Vista Extension which confirmed the potential for an economic and technically feasible underground longwall mine. Highlights of the scoping study included:
- Forecast average production of 3.8 million tonnes per annum ("Mtpa") (6.3 Mtpa run of mine) marketable coal;
- Potentially mineable resources of approximately 108 Mt and a mine life of 28 years;
- Development costs of C$346 million, which reflect cost savings due to the close proximity of the Vista infrastructure; and
- Low average operating costs of C$58.2/t free-on-board Ridley Terminals over the life of the mine.
- Coalspur finalised port allocation agreements with Ridley Terminals to secure 11.7 Mtpa of deep water port throughput capacity, which substantially satisfies the port requirements for the anticipated Vista Coal Project ("Vista") production.
- The Company expanded its memorandum of understanding with CN rail from 11.2Mtpa to 12.0Mtpa to accommodate the optimized production profile on Vista.
- Regulatory bodies continued their review of Coalspur's Environmental Impact Assessment and Mine License applications, and the Company made substantial progress with respect to aboriginal consultation and other stakeholder engagement.
- The Company continued its process to identify a strategic investment partner, which it anticipates concluding during 2012.
Subsequent to quarter end, the Company completed an optimisation study on Vista which minimized the capital required to achieve initial production. Highlights of the study include:
- Development capital to achieve first production in 2015 reduced to C$527 million (C$343 million lower than the Vista Feasibility Study)
- Potential further reduction of up to C$82 million by leasing/contracting mobile equipment, taking development capital to approximately C$445 million
- Total net funding to achieve full 12.0 Mtpa production capacity of C$841 million with project cashflows substantially contributing to expansion funding
- Development capital expected to be funded either by a strategic partner or a combination of a strategic partner and an off-take arrangement
- Development plan maintains integrity of the current regulatory process
The Company is currently focusing on the financing, regulatory and technical efforts necessary to commence construction on Vista. Activities in the coming months are expected to include:
- Progress discussions with potential strategic investment partners;
- Advance the regulatory applications necessary to commence construction on Vista;
- Progress negotiations with CN on the definitive transportation agreement;
- Continue detailed design engineering on Vista; and
- Continue discussions with mining contractors who may be utilised during the construction phase and the initial years of mining at Vista.
For further information regarding the Vista Coal Project and Vista Extension, including a description of Coalspur's quality assurance program, quality control measures, the geology, samples collected and testing procedures in respect of the projects, please refer to the technical report titled "Coalspur Mines Limited: Updated Resource Estimate for the Vista Coal Project" dated September 12, 2012. For further information regarding the Vista South Coal Project, including a description of Coalspur's quality assurance program, quality control measures, the geology, samples collected and testing procedures in respect of the project, please refer to the technical report titled "Resource Estimate for the Vista South Coal Property" dated June 25, 2012. The technical reports are compliant with National Instrument 43-101 - "Standards of Disclosure for Mineral Projects" ("NI 43-101") and the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' ("JORC Code") and are available for review on SEDAR at sedar.com.
Competent Person / Qualified Person Statements
The information in this report that relates to coal quality and process yield estimates to derive Marketable Coal Reserves, coal processing, thermal drying, infrastructure, and associated capital and operating costs is based on information compiled by Mr. Gordon Mudryk, who is a Member of the Association of Professional Engineers and Geoscientists of Alberta. Mr. Mudryk is a full-time employee of Coalspur. Mr. Mudryk has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Mudryk has approved and consents to the inclusion of such information in this report in the form and context in which it appears.
The information in this report that relates to Coal Resources is based on information compiled by Mr. John Innis, who is a Member of the Association of Professional Engineers and Geoscientists of Alberta. Mr. Innis is a full-time employee of Coalspur. Mr. Innis has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the 2004 Edition of the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Innis has approved and consents to the inclusion of such information in this report in the form and context in which it appears.
All other scientific and technical information in this report is based on information compiled by Mr. David Leslie, who is a Member of the Association of Professional Engineers and Geoscientists of Alberta. Mr. Leslie is a full-time employee of Coalspur. Mr. Leslie has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a "Competent Person" as defined in the JORC Code, and a "Qualified Person" under NI 43-101. Mr. Leslie has approved and consents to the inclusion of such information in this news release in the form and context in which it appears.
Forward Looking Statements
This report contains forward-looking statements concerning Coalspur Mines Limited ("Coalspur" or the "Company"), including statements regarding Coalspur's plans for its mineral projects, its exploration and development activities, and other matters. These statements relate to analyses and other information that is based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Actual results could differ materially from the conclusions, forecasts and projections contained in these forward-looking statements.
Statements concerning Mineral Resource Estimates may also be deemed to constitute "forward-looking statements" to the extent that they involve estimates of the mineralization that will be encountered if a given property is developed. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects", "is expected", "anticipates", "plans", "projects", "estimates", "assumes", "intends", "future", "strategy", "goals", "objectives", "potential" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to materially differ from those reflected in the forward-looking statements.
Coalspur's forward-looking statements are based on the beliefs, expectations and opinions of management as of the date hereof and which Coalspur believes are reasonable in the circumstances, but no assurance can be given that these expectations will prove to be correct. In making the forward-looking statements the Company has applied several material assumptions which may prove to be incorrect, including, but not limited to: (1) that all required third party approvals will be obtained for the development, construction and production of its properties; (2) that additional financing will be available on reasonable terms; (3) there being no significant disruptions affecting operations, whether due to labour disruptions, supply disruptions, power disruptions, damage to equipment or otherwise; (4) permitting, development and expansion proceeding on a basis consistent with the Company's current expectations; (5) currency exchange rates being approximately consistent with current levels; (6) certain price assumptions for coal; (7) production forecasts meeting expectations; (8) the accuracy of the Company's current mineral resource and reserve estimates; (9) labour and materials costs increasing on a basis consistent with the Company's current expectations; (10) assumptions made and judgments used in engineering and geological interpretation.
Coalspur disclaims any intention or obligation to update or revise forward-looking statements if circumstances or management's beliefs, expectations or opinions should change, except as required by law. For the reasons set forth above, undue reliance should not be placed on forward-looking statements.
For a more detailed analysis of risks affecting the Company, please see the Risk Factors discussion in the Description of the Business section of the Company's Annual Information Form, which is available from SEDAR at www.sedar.com.
SOURCE Coalspur Mines Limited