Atrum buys out JV partner Elan in Alberta
PERTH (miningweekly.com) – Coal miner Atrum Coal has entered into a share sale deed to acquire Canadian firm Elan Coal’s coal properties in Alberta.
Atrum, through its subsidiary Kuro Coal Canada, in 2014 acquired a 70% interest in the Elan properties through a joint venture (JV) agreement, under which it spent C$7-million on exploration and the completion of a scoping study.
At the time, the company considered spinning out Kuro into a separate entity, but a slump in the coal market scuppered plans. Atrum noted on Wednesday that a subsequent rebound in growth and price forecasts had resuscitated interest in the coal tenements.
In early 2017, the JV partners opened discussions over the best way to develop the Elan properties, with the results of those discussions being an agreement under which Kuro would acquire full ownership of the projects by acquiring all the shares in Elan.
As consideration for Elan, the vendors would receive C$3.1-million in cash, while Kuro Coal Canada would also issue some A$3.65-million in scrip.
Atrum nonexecutive chairperson Chuck Blixt noted that the Elan properties consisted of six different areas that were known to hold shallow emplacements of metallurgical coal.
“The first project we will target for development will be Grassy North, which is adjacent and contiguous with the Riversdale Resources Grassy Mountain project. Many areas within Elan have outcropping coal, and the railway is only 12 km away.”
Blixt noted that Atrum now had premium metallurgical coal projects in two provinces in Canada, being the Groundhog/Panorama anthracite project and the Elan hard coking coal project.
The Elan project is currently estimated to host a coal resource of some 146.5-million tonnes, and has an exploration target of between 735-million and 755-million tonnes.
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