Paringa reports lower Buck Creek No 1 mine capital cost
PERTH (miningweekly.com) – Coal developer Paringa Resources has reduced the expected capital cost of its Buck Creek No 1 mine, in the US, from $127-million to $106-million.
The company said on Wednesday that it had now received bids for all major capital items for the construction and development of the Buck Creek No 1 mine and, owing to the competitive bidding process between the contractors, there had been a significant reduction in the capital expenditure required to develop the mine.
“This is an outstanding outcome for Paringa and the result of long and hard work from our US management team. We are looking forward to continuing discussions with potential financiers this year and have received exceptional feedback since announcing our cornerstone coal sales agreement with Louisville Gas and Electric Company and Kentucky Utilities Company,” said Paringa president and CEO David Gay.
The coal sales agreement with Louisville Gas and Electric Company and Kentucky Utilities Company, would see Paringa deliver 4.75-million tonnes of coal over a five-year period, with 750 000 t to be delivered in 2018, and one-million tonnes a year between 2019 and 2022.
The competitive bids would now be incorporated into a bankable feasibility study for the Buck Creek No 1 mine, which would be released later this quarter, along with a scoping study into the Buck Creek No 2 mine.
Paringa expected to start production at Buck Creek No 1 in 2018, with the project reaching its full capacity of 3.8-million tonnes a year by 2020. The project was expected to have a mine life of some 18 years.
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