UNI - EN REPORT No21/2016
PRAIRE MINING LIMITED
NEWS RELEASE | 31 October 2016
SEPTEMBER 2016 QUARTERLY REPORT
Acquisition of Debiensko Hard Coking Coal Project
•Acquisition of fully permitted, “mine ready” project of significant global scale.
•Transformational acquisition marking Prairie’s entry into the hard coking coal sector, complementing Prairie’s advanced Jan Karski Mine, and creating a multi-project coal development company based in Poland to supply European industry.
•Strategic location in the steelmaking heartland of Europe where approximately 80% of current coking coal usage is imported.
•Debiensko comes with a 50-year mining concession, established on-site facilities including rail, road and power infrastructure, comprehensive historical drilling data and all environmental consents.
•As a brownfield development project, significant historical capital investment positions Debiensko to become a meaningful, near-term regional hard coking coal producer.
•Through this acquisition, Prairie acquires a highly experienced team of Polish mining specialists including engineers, mine managers, mine planners, geologists, surveyors and environmental specialists that brings substantial synergies to expedite permitting and development of Prairie’s flagship Jan Karski Mine.
Jan Karski Mine (formerly Lublin Coal Project)
•Discussions with strategic partners, EPC contractors, global project finance banks and potential offtakers continue following the excellent results of the pre-feasibility study published in March 2016.
•Permitting process for the Mining Concession application continues including:
oCompletion of the draft Deposit Development Plan.
oSubstantial progress on procedures related toenvironmental permitting and local land rezoningContinued land acquisition process aimed at securing access to the planned surface infrastructure sites for project development.
oApplication progressing for a power grid connection for the Jan Karski Mine with the regional power distributor.
oAdvancement of the planned railway spur line connection to the national railway network which was officially included in the Lublin Regional Development Strategy.
•Hydrogeological analysis continued in order to provide enhanced hydrogeological data for the ESIA.
•Coal is widely recognised to be the best performing commodity in 2016, with prices forecast to stabilise at higher levels over the medium term. Since the start of the year, hard coking coal prices have increased by more than 180%, semi-soft coking coal by more than 85% and thermal coal by almost 100%.
•Coking coal continues to be classified by the European Commission as the third most economically important “critical raw material” for the European economy.
•As at 30 September 2016, Prairie has cash on hand of A$16.8 million and is in a strong financial position to progress with its planned development activities.
•Undertake a work program to review all historic data at Debienkso including 3D geological modelling, and release a maiden JORC Resource Estimate.
•Commence a focused in-fill drill program to increase JORC indicated resources to support feasibility studies for Debiesnko.
•Confirm potential of premium hard coking coal quality through detailed analysis and coal quality benchmarking.
•Deliver a re-engineered mine plan to produce a feasibility study to international standards with a focus on near term production on Debiensko.
•Continue to advance financing discussions with strategic partners, EPC contractors, global project finance banks and potential offtakers to structure a development financing package for the Jan Karski Mine.
•Progress the Mining Concession process for the Jan Karski Mine, including the rezoning of land for mining use and the ESIA for the project and submission of these to the relevant authorities for approval. Once approved the Company will formally lodge its Mining Concession application for the Jan Karski Mine.
•Other required project development activities including land acquisition at the Jan Karski Mine.
•Study activity across the Jan Karski Mine specifically aimed at improving knowledge of hydrogeological conditions and confirming the definitive shaft site location.
For further information on the Company's activities conducted during the quarter, please refer to full September 2016 Quarterley Report and Appendix 5B attached as an annex to this report.
For further information contact:
Ben Stoikovich Artur Kluczny Sapan Ghai
Chief Executive Officer Group Executive – Poland Communications
+44 207 478 3900 +48 22 351 73 80 +44 7557 055 166