Mining activities at Universal Coal’s Roodekop project remain on track to commence in December 2014 quarter, now that its water licence has been awarded and its proved reserve estimate increased to 10.6 Mt.
The mine plan for the Northern Opencast Area was optimised following incorporation of data from a 48-hole infill drilling programme completed in 2013. The updated mine plan resulted in a 13% increase in the JORC 2012 compliant proved reserve at Roodekop to 10.6 Mt.
The NCC geological database, as acquired from Exxaro, was validated and corrected and an updated geological model and resource estimation for the Diepspruit section at NCC was completed.
Subsequent to the end of the quarter, the Integrated Water Use license (IWULA) was granted by the Department of Water Affairs (DWA). Roodekop has now been awarded all relevant mining and social licences to operate by the regulatory authorities. Mining activities are on track to commence in the December 2014 quarter.
Negotiations with the surface owner regarding acquisition of the land are progressing and will be completed during Q2 2015.
The Universal Coal team that implemented the Kangala Colliery has now assumed full functional development activities for the NCC/Roodekop project. The mine geologist and technical engineering manager have been appointed and a full time metallurgical manager is in the process of being recruited.
Universal Coal announced has secured a strategic investment by international coal company IchorCoal of A$24.5 million and a further subscription of A$1 million by major shareholder Coal Development Holding (CDH).
The subscriptions are due to complete on 16 October 2014. The capital raise is priced at a combined weighted average issue price representing an approximate 30% premium to the closing price on 1 September 2014.
The funds raised will complete the financing for the acquisition of the New Clydesdale Colliery (NCC) from Exxaro Coal Mpumalanga, part-fund the development of the Roodekop project in conjunction with NCC and, in respect of any balance, fund general working capital and implement further acquisition opportunities as they arise.
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