Paringa Resources Ltd. out of Australia said Sept. 6 that it has secured 100% of the rights to acquire the surface property necessary to construct the company’s Poplar Grove Mine (formerly called No. 2 Mine) in western Kentucky.
Paringa’s proposed 1.8 million ton per annum (Mtpa) Poplar Grove Mine is located immediately south of the company’s proposed 3.8 Mtpa Cypress Mine (formerly called No. 1 Mine), both located within the Buck Creek Complex. The surface rights secured represents a total of 318 acres controlled by local landowners. The secured mine site property for Poplar Grove complements the previously secured and permitted Barge Load-Out Facility on the Green River and the Cypress Mine Site.
Permitting for the Poplar Grove Mine is progressing as planned and remains on track for mine construction to begin in early 2017 and production to begin in early 2018, the company said. In addition, significant reductions are also expected to the operating costs (“Opex”) at the Poplar Grove Mine due to continued reductions in the costs of labor, materials, supplies and leased equipment, and fuels. The final Opex estimate will be incorporated into a Bankable Feasibility Study (BFS) which is due during 2016.
Paringa President and Chief Executive Officer David Gay said: “Over the coming months, Paringa is looking forward to updating the market on the Poplar Grove Mine’s design, infrastructure, Opex estimate, leasing and permitting. General investor sentiment for US thermal coal continues to show signs of improving, providing an ideal environment to finalize financing discussions for the best undeveloped thermal coal project in the US.”
The final Capex estimate for the Poplar Grove Mine has been reduced to US$39 million, representing a saving of US$5 million when compared to the previous Capex estimate. Significant reductions are also expected to the final Opex estimate for Poplar Grove. As previously announced, almost 60% of the Poplar Grove Mine’s annual production during the first five years of operation is now contracted under a cornerstone coal sales agreement with Louisville Gas and Electric and Kentucky Utilities.