Update on Transportation Agreements with Ridley Terminals and CN Rail
CALGARY, Sept. 4, 2012 /CNW/ - Coalspur Mines Limited ("Coalspur" or "Company") (ASX: CPL) (TSX: CPT) is pleased to announce the terms of an updated port allocation agreement (the "Updated Agreement") with Ridley Terminals Inc. ("Ridley Terminals") and an expanded memorandum of understanding ("MOU") with CN Rail ("CN").
Port Allocation at Ridley Terminals
The Updated Agreement entitles Coalspur to an additional 2.2 million tonnes per annum ("Mtpa") of throughput capacity, beginning in 2017, which is in addition to the 9.5Mtpa of port allocation that Coalspur currently has contracted with Ridley Terminals. The Updated Agreement replaces an earlier agreement between Coalspur and Ridley Terminals which provided for 4.0Mtpa, contingent on the approval of the Federal Government of Canada for a fourth stacker / reclaimer at Ridley Terminals which would have allowed the terminal to expand beyond their currently planned 25Mtpa. The approval of the Federal Government was not received by the date stipulated in the earlier agreement. Ridley Terminals offered Coalspur an additional 2.2Mtpa of throughput capacity on its existing approved expansion footprint as an alternative. Agreement has been reached for this tonnage allocation which is on the same commercial terms as contained in the original agreement.
Coalspur has now secured 11.7Mtpa of port allocation at Ridley Terminals which substantially satisfies the requirements for the Company's flagship Vista Coal Project ("Vista") which is scheduled to produce up to 12.0Mtpa of high quality thermal coal.
Expanded MOU with CN
Following the optimization study which increased the clean coal production rate on Vista to 12.0Mtpa (announced April 26, 2012), Coalspur and CN have expanded the scope of the memorandum of understanding which was announced in November 2011. The revised MOU increases Coalspur's allocated rail haulage from 11.2Mtpa to 12.0Mtpa to accommodate the optimized production profile on Vista. Coalspur and CN continue to work towards definitive transportation and infrastructure agreements which are expected to be concluded in 2012.
Commenting on the updated agreements with Ridley Terminals and CN, Gill Winckler, President and Chief Executive Officer of Coalspur, said "Coalspur's access to existing first-world rail and port infrastructure places it in a unique position amongst coal development companies worldwide. The latest agreement with Ridley Terminals secures our port allocation requirements for Vista in an existing facility and the revised MOU with CN provides for matching rail capacity. We are working closely with CN on definitive agreements which, once finalized, are expected to complete the infrastructure requirements to export coal from Vista to the Asia Pacific market."
Other Corporate Updates
The Company is making good progress with its process of securing funding for Phase 1 of the Vista project and discussions are continuing with several parties in this regard. Coalspur is also evaluating a number of initiatives which have the potential to optimise the development schedule for Vista and reduce the maximum capital requirements in the earlier years. These initiatives will ensure that construction commences as planned in the second quarter of 2013 and first production in early 2015.
Coalspur remains well capitalized with access to approximately $55 million in cash and available credit which is sufficient to fund operations well through detailed engineering and the Phase 1 regulatory process.
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 June 21, 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 for the Vista Coal Project, the Vista South Coal Project, and Vista Extension are compliant with National Instrument 43-101 - "Standards of Disclosure for Mineral Projects" ("NI 43-101") and are available for review on SEDAR at sedar.com.
Competent Person / Qualified Person Statements
The information in this news release that relates to Coal Resources on the Vista Coal Project and Vista Extension, mining engineering, Recoverable Coal Reserves, capital costs, mining operating costs, and economic financial analysis, process capital costs and associated infrastructure, and 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 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' ("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.
The information in this news release that relates to coal quality and process yield estimates to derive Marketable Coal Reserves is based on information compiled by Mr. Gordon Mudryk, who is a Member of the Association of Professional Engineers, Geologists and Geophysicists 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 news release in the form and context in which it appears.
Forward Looking Statements
This news release 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", "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, including those referred to in the Company's Annual Information under the heading "Description of the Business - Risk Factors", and elsewhere.
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; and (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.
SOURCE Coalspur Mines Limited