U.S. Coal Projects - Update

RNS Number : 0529Z

Regency Mines PLC

09 March 2017

 

REGENCY MINES PLC

("Regency" or the "Company")

U.S. Coal Projects - Update

9 March 2017

Regency Mines Plc announces, further to the announcements of 6^th February and 27^th February 2017, developments at its coal projects located in the Appalachian Basins of the Eastern U.S.

Regency has now invested $150,000 for a 20% Shareholding in the new joint venture company Vali Carbon Corporation ("VCC") under the terms of the joint venture with UK Carbon Resolutions Ltd ("UKCR") announced on 6^th February 2017 and is proceeding with the formal documentation which is now expected to be completed within the next two weeks. UKCR has now identified a new metallurgical coal opportunity within the target Appalachian area which UKCR has secured and is transferring into VCC. The parties will continue to progress this project, and a further announcement will be made when formal documentation is completed.  

Meanwhile at the Rosa Mine in Alabama, held by Carbon Minerals Corporation, a company 20% owned by Regency, contract washing of coal at the 125 tons per hour preparation plant continues as scheduled. Mining of coal with the highwall miner on site will start shortly, and third party deliveries of mined coal are expected to start before the end of March.

Andrew Bell, Chairman of Regency Mines, comments: "The political and economic background for metallurgical coal remains almost entirely favourable, and we welcome President Trump's plans for $1 trillion of much-needed investment in America's public infrastructure. As coal continues its recovery from extreme cyclical lows, interest is returning to the sector, and we aim with our partners to establish an early footprint that will have a quality and scale difficult to replicate as the recovery consolidates. We have identified with our partners a number of opportunities to ramp up production and diversify our sources of saleable coal, of which these are the first.

The immediate priority now that Rosa has become cash flow neutral-to-positive is to accelerate cash flow generation, both by moving from contract washing to mined coal sales at Rosa, and by working towards early production through strip mining of permitted areas at the VCC project". 

Background

Regency is helping to bring into production metallurgical coal projects in the Appalachian coal belt in the Eastern United States. The Appalachians have long been one of the world's largest sources of coal, and some areas contain high quality metallurgical coals.

Regency currently has two projects, and is working on a third.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

For further information, please contact:

Andrew Bell 0207 747 9960                                                  Chairman Regency Mines Plc

Scott Kaintz 0207 747 9960                                                   Executive Director Regency Mines Plc

Roland Cornish/Rosalind Hill Abrahams 0207 628 3396    NOMAD Beaumont Cornish Limited

Jason Robertson 0129 351 7744                                           Broker Dowgate Capital Stockbrokers Ltd.

 

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