Bulk Metals: Allegiance cuts start-up capex for coking coal project by 40pc to $US24m
Allegiance Coal (ASX:AHQ) has made the cost of starting-up its New Elk coking coal project in Colorado somewhat more palatable after slashing initial capital expenditure from $US40m to $US24m.
This reduction was achieved by rescheduling the start-up of its first three production units in the first year of production.
All other factors including saleable coal tonnes, total mine capex and total cash operating costs remained unchanged.
The latest reduction in start-up capex is itself a further reduction on the initial start-up cost of $US56m that was estimated in the maiden feasibility study.
“This revision to the start-up mine plan, what we call the ‘Slow Start-up Mine Plan’, offers Allegiance the ability to commence production with a significantly lower start-up capital demand, if Allegiance is required, or feels it would be prudent at the time, to do so,” managing director Mark Gray said.
He added the company remained confident of securing the capital required for the project.
Earlier this month, the company expanded the resource tonnage at New Elk by 87.6 million tonnes to 744 million tonnes after acquiring the neighbouring Lorencito lease agreements that contain the same coal bearing units.
Meanwhile, Highfield Resources (ASX:HFR) has signed a non-binding memorandum of understanding for the annual sale of salt by-products from its Muga potash mine in Spain to international salt distributor Maxisalt-Pardira Premium.
Under the agreement, the company will sell Maxisalt up to 400,000 tonnes of higher value vacuum salt and 100,000 tonnes of de-icing salt.
The sale of salt, which is produced as a by-product of potash processing, will help maintain the low environmental footprint of the Muga mine and assist in ensuring full compliance with environmental conditions.
Highfield continues to engage in offtake discussions for the entire production capacity of potash and salt from the project.