Pacific American raises funding for Elko project by selling GCI interest
JOHANNESBURG (miningweekly.com) – Australia-listed junior Pacific American Coal has announced the sale of its equity interest in GCI, the owner of the P8N operating mine in the US, to provide funding for its coking coal project, in Canada.
Pan American would receive A$1-million for its 30% stake in the US company, recovering its original investment of $731 250, the ASX-listed company reported on Thursday.
The proceeds from the sale would be used for the development of the Elko project, in British Columbia.
Pan American reported that an increase in coking coal price had resulted in renewed interest from Asia in potential offtake agreements for the Elko project, which had the second-largest coal resource in the Crowsnest coalfield after Teck Resources. Pan American has discovered a 257.5-million-tonne resource at Elko.
The project was currently in the concept study phase and would advance to the prefeasibility study (PFS) stage towards the end of 2016 and feasibility study stage in 2017. The junior coal company aimed to start operations at the project by the end of 2019.
Pan American had spent $250 000 on concept studies and would need another $400 000 to complete the study, which aimed to demonstrate the fundamentals of the mine and attract an investment partner. A further $4-million would be required to complete the PFS and $5-million for the feasibility study.
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