Morien Provides Update on Donkin Coal Mine
May 21 2019 - 9:40AM
Morien Resources Corp. ("Morien" or the "Company") (TSXV:MOX), is
pleased to announce that it has received notice from Kameron
Collieries ULC (“Kameron”), the owner and operator of the Donkin
Coal Mine (“Donkin” or “Mine”) in Cape Breton, Nova Scotia, that it
has been granted approval by the Nova Scotia Department of Labour
and Advanced Education (“LAE”) for a revised ground control
procedure which allows for the continuation of mining and
development operations at Donkin.
Kameron announced in early January 2019 that LAE
had rescinded its approval of the existing ground control procedure
at Donkin due to a fall of ground. No workers were injured nor
equipment damaged. Kameron submitted a revised ground control
procedure and mine plan to LAE in late January and was subsequently
granted approval to recommence mining on a limited scale.
Since that time, Kameron has operated on a limited basis at a
reduced capacity using the interim ground control plan.
With the re-commencement of normal operations at
Donkin, Kameron currently has two fully operating coal sections.
These include one section with a recently installed flexible
conveyor train, which is a continuous haulage, mobile conveyor belt
that replaced the shuttle car fleet in that section. The second
coal section is using a traditional shuttle car fleet. Both coal
sections are actively developing the Mine’s main underground
infrastructure and first production panel.
Morien owns a gross production royalty for the
Mine of 2% on the revenue from the first 500,000 tonnes of coal
sales per calendar quarter, net of certain coal handling and
transportation costs, and 4% on the revenue from any coal sales
from quarterly tonnage above 500,000 tonnes, net of certain coal
handling and transportation costs. The royalty is payable to Morien
on a quarterly basis over the anticipated 30+ year mine life.
Morien’s royalty payments from Kameron increased
from $4k in Q2 2017, when production at Donkin commenced, to $298k
in Q4 2018. During Q1 2019, while production was temporarily
suspended and while Kameron operated at a reduced capacity,
Morien’s Donkin royalty decreased to $169k. At full production of
2.75 to 3.0 million saleable tonnes per year (1,2), and using a
wide range of coal pricing (CAD $60 to $120 per tonne), royalty
payments to Morien could be in the order of CAD $5.0 to $9.0
million annually (2).
In January 2019, it was reported that Provincial
Energy Ventures Ltd. (“PEV”) is proceeding with the first phase of
its $75 million expansion of its export facility in Sydney, Cape
Breton. PEV is located approximately 30 kilometres from the
Mine and is currently responsible for handling all of the exported
coal from Donkin. Once complete, the PEV port will be capable
of accommodating larger vessels and is expected to have the
capacity to export up to 3.0 million tonnes of Donkin coal
annually. A new, dedicated coal haul road that will by-pass
certain communities along the current truck route between Donkin
and PEV is expected to be complete during the first half of
2019.
Footnotes: |
|
(1) |
The above technical disclosures are consistent with the information
in the technical report titled “Technical Report, Donkin Coal
Project, Cape Breton, Nova Scotia, Canada” dated November 2012,
found on Morien’s SEDAR profile. |
|
(2) |
These values are only estimates based on assumptions Morien
management consider reasonable, as of Q2 2019, and would only be
achieved if and when Donkin reaches permitted production levels.
Actual results and royalties received, if any, subject primarily to
production rates and coal pricing, may vary from those estimated by
Morien. Morien incurs general and administrative expenses in
respect of the administration and preparation of filing of
regulatory filings as a public company, collection of revenues from
the aforementioned royalties and seeking and acquiring new mineral
projects. |
Qualified Person
Dawson Brisco, P.Geo. (Nova Scotia), President
and CEO of Morien, is a Qualified Person as that term is defined in
National Instrument 43-101 and has reviewed and approved the
scientific and technical information contained in this news
release.
About Morien
Morien is a Canada based, dividend paying,
mining development company that holds royalty interests in two,
long life, world class, tidewater accessed projects. The
Donkin Coal Mine commenced production in 2017 and the Black Point
Aggregate Project was permitted in 2016 and is progressing toward a
development decision. Morien’s management team exercises
ruthless discipline in managing both the assets and liabilities of
the Company. The Company’s management and its Board of
Directors consider shareholder returns to be paramount over
corporate size, number or scale of assets and industry
recognition. Morien has 53,793,864 issued and outstanding
common shares and a fully diluted position of 57,220,614. Further
information is available at www.MorienRes.com.
Forward-Looking Statements
Some of the statements in this news release may
constitute "forward-looking information" as defined under
applicable securities laws. These statements reflect Morien's
current expectations of future revenues and business prospects and
opportunities and are based on information currently available to
Morien. Morien cautions that actual performance will be
affected by a number of factors, many of which are beyond its
control, and that future events and results may vary substantially
from what Morien currently foresees. Factors that could cause
actual results to differ materially from those in forward-looking
statements include risks and uncertainties described in Morien’s
annual information form filed with the Canadian Securities
regulators on SEDAR (www.sedar.com) on April 26, 2016. Morien
cautions that its royalty revenue will be based on production by
third party property owners and operators who will be responsible
for determining the manner and timing for the properties forming
part of Morien’s royalty portfolio. These third party owners
and operators are also subject to risk factors that could cause
actual results to differ materially from those predicted herein
including: volatility in financial markets or general economic
conditions; capital requirements and the need for additional
financing; fluctuations in the rates of exchange for the currencies
of Canada and the United States; prices for commodities including
gold, coal and aggregate; unanticipated changes in production,
mineral reserves and mineral resources, metallurgical recoveries
and/or exploration results; changes in regulations and
unpredictable political or economic developments; loss of key
personnel; labour disputes; and ineffective title to mineral claims
or property. There are other business risks and hazards
associated with mineral exploration, development and mining.
Although Morien believes that the forward-looking information
contained herein is based on reasonable assumptions, readers cannot
be assured that actual results will be consistent with such
statements. Morien expressly disclaims any intention or
obligation to update or revise any forward-looking information in
this news release, whether as a result of new information, events
or otherwise, except in accordance with applicable securities laws.
All dollar values discussed herein are in Canadian dollars.
Any financial outlook or future-oriented financial information in
this news release, as defined by applicable securities laws, has
been approved by management of Morien as of the date of this news
release. Such financial outlook or future-oriented financial
information is provided for the purpose of providing information
about management's current expectations and plans relating to the
future. Readers are cautioned that such outlook or information
should not be used for purposes other than for which it is
disclosed in this news release.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
For more information, please contact:Dawson
Brisco, President & CEOOffice: (902) 423-6419Mobile: (902)
403-3149 dbrisco@MorienRes.comorJohn P.A. Budreski, Executive
ChairmanPhone: (416) 930-0914www.MorienRes.com
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