Coal news and updates

Atlantic Coal unveils 37% increase in reserve at Stockton

A new reserve estimate for the Stockton mine in Pennsylvania has increased the amount of coal available by 37%, Atlantic Coal (LON:ATC) told investors.

The additional reserves spell good news for mining costs and will potentially extend the life of the project by three years, the firm added.

Investors welcomed today's update, sending shares up 7.69% to 0.14p.

The Stockton reserve is now put at 2.220 million tons, as at end of 2014, compared to 1.626 million tons as at Dec 31, 2013.

"This is primarily attributable to the increased reserves in the Mammoth seam but also to a higher proportion of coal remaining from previous underground mining in the Primrose, Orchard and Diamond seams than previously estimated," Atlantic said.

The higher coal reserve has also resulted in a substantial decrease in the mining ratio to 13.99 cubic yards of overburden (the amount of material to be removed) to 1 ton of clean coal compared to 19.40 cubic yards to 1 ton in 2013.

Atlantic reckons this 28% decrease in the ratio bodes well for mining costs in the future.

Managing director Steve Best told investors: "We are pleased to announce this increase in Stockton's reserve base and subsequent expected mine life extension of three years. 

"An added bonus is the 28% decrease in the mining ratio since this is the primary determinant of mining cost and, as such, enables us to look ahead with confidence."

Last month, the firm reported an "excellent performance" in its first quarter with better sales and production stats.

Clean coal production for the three months to end March was 45,669 tons compared to 34,451 tons a year ago. Run of mine production stood at 136,981 tons (Q1 2014: 86,614 tons).

Total sales were 44,356 tons compared to 36,449 tons in the same three months in 2014.

source: http://www.proactiveinvestors.co.uk