Australia’s Ambre Energy Ltd., which last year bought into the U.S. coal mining business in Montana and Wyoming, on April 2 issued a statement refuting a report by The Australian newspaper that its finances are shaky.
“Ambre Energy strongly refutes any suggestion it is at risk of ‘financial collapse,’” said the statement. “The company’s financial results for the 2011 financial year were expected and budgeted and entirely indicative of a company which is acquiring and developing a number of large operating assets as part of its long term growth strategy. To date during the 2012 financial year Ambre Energy has raised over [A]$112 million in equity and debt funding and is in a strong financial position. The company is well supported by many long term shareholders, including the resource specialist private equity fund, Resource Capital Funds, and is currently progressing towards a listing on the Australian Securities Exchange (ASX) in the middle of 2012.”
The company’s coal-to-liquids project at Felton in Queensland, Australia, remains in the early investigation stage, Ambre noted. The company believes the Felton project presents an important economic opportunity for Queensland in the longer term, however, it is a relatively immaterial contributor to Ambre’s current overall value proposition as it approaches an ASX listing.
The company said it remains highly focused on the continued development of its integrated mine-to-market suite of coal mine and port assets in the U.S.
The company pointed out that it has submitted detailed permit applications for both its Millennium Bulk Terminals project in Washington and Morrow Pacific port project in Oregon. Both sites are located on the Columbia River, which flows into the Pacific Ocean. Millennium, closer to the ocean, has water depth to handle Panamax-size ships at the site, while Morrow Pacific is further up the river in shallower water and coal would need to be barged from there down the river and then transloaded to ship.
At Millennium, consolidated permit applications for a 44 million tonnes per year coal handling terminal, to be built in two stages, have been lodged with the relevant authorities. Ambre owns 62% of the Millennium project while Arch Coal (NYSE: ACI), the second largest producer of coal in the U.S., holds 38%. For the Morrow Pacific project, which is 100% owned by Ambre, consolidated permit applications for an 8 million tonnes per year barge loading and transshipping operation, to be built in two stages, have been lodged with authorities.
The company is also a 50% owner and sole mine operator of two producing thermal coal mines in Montana and Wyoming. Production at these two mines, Decker Coal (Montana) and Black Butte Coal (southwest Wyoming), in the 2011 calendar year was about 6 million tonnes. Ambre last November acquired these mine shares from Level 3 Communications (NYSE: LVLT), a telecommunications provider headquartered in Broomfield, Colo.
Ambre’s 50% partner in Decker Coal is Cloud Peak Energy (NYSE: CLD), while its partner at Black Butte Coal is Anadarko Petroleum (NYSE: APC). Black Butte is a major supplier to the nearby Jim Bridger power plant operated by PacifiCorp.