American Power Corp. (OTC.BB:TGMP) will proceed to kick start the development of its advanced Pace Coal Project in Judith Basin County, Montana.
In April 2010, American Power Corp. acquired roughly 29,000 acres, which make up the Pace Coal Project. In 1979 Mobil Oil Co. (now ExxonMobil) drilled 30 holes over 14,000 of the project’s acreage, and delivered 45 samples which were later sent to an independent laboratory for analysis. It was subsequently determined that both the quality and the quantity of coal on the Pace acreage was high and significant, respectively. Several independent reports were commissioned based on the development work undertaken by Mobil Oil, determining there could be in excess of 410 million tons of high volatility bituminous coal potential on the Pace acreage.
Al Valencia, CEO of American Power Corp. commented: “A tremendous amount of work has already been undertaken on the Pace Coal Project and we continue to work towards our stated goal of proving up a mineable reserve and preparing a mine plan to re-establish coal production on the property as soon as possible.”
Montana’s demonstrated reserve base of 119.1 billion short tons of coal represents over 24% of America’s total demonstrated coal reserve base of 487.7 billion short tons. Of particular importance, the coal at the Pace Coal Project is bituminous B coal, which, due to its higher BTU rating, secures a higher market price than most of Montana’s coal (typically sub-bituminous or lignite).
American Power Corp. has access to a large and experienced workforce in Great Falls, Montana, and the coal project may provide hundreds, if not thousands, of new, high-paying jobs for the local economy (according to the U.S. Bureau of Labor Statistics, the average annual wage in the mining industry in Montana was $70,779 in 2008, or 122 percent higher than the average wage in the state).
Substantial infrastructure is already in place adjacent to and within the acreage, including a federal highway, a BNSF railway line, pipeline, and power lines, all of which would facilitate the economic extraction and transportation of coal to market.
James River Coal Company (Nasdaq:JRCC) mines, processes and sells bituminous, steam- and industrial-grade coal through six operating subsidiaries located throughout eastern Kentucky and southern Indiana. As of December 31, 2009, James River Coal’s six mining complexes included 14 underground mines, 10 surface mines and 10 preparation plants, five of which have integrated rail loadout facilities and three of which use a common loadout facility at a separate location.
In 2009, James River Coal produced 9.8 million tons of coal (including 0.3 million tons of coal produced in mines that are operated by contract mine operators) and they purchased another 0.1 million tons for resale. Of the 9.5 million tons James River Coal produced from Company-operated mines, approximately 66% came from underground mines, while the remaining 34% came from surface mines. In 2009, James River Coal generated revenues of $681.6 million. Approximately 92% of 2009 revenues were generated from coal sales to electric utility companies and 8% came from coal sales to industrial and other companies.
Patriot Coal Corporation (NYSE:PCX) has named Thomas H. “Pete” Simpson Operations Manager responsible for all operations at the Federal No. 2 mine and its supporting facilities. Simpson will succeed Joseph B. “Blair” McGill, who will be retiring from the Company in January 2011, and will report to James N. Magro, Senior Vice President of Underground Mining.
Simpson has over 35 years of experience in underground mining and management experience, with a strong background in longwall mining in the Pittsburgh coal seam. He holds a Bachelor of Science degree in Mining Engineering from West Virginia University.
“Pete’s significant prior experience running mines in Northern Appalachia will be invaluable in this new role overseeing our Federal longwall mine. We intend to draw on Pete’s expertise as we continue to optimize operations at this important property,” said Patriot Chief Executive Officer Richard M. Whiting. “At the same time, I express our appreciation for Blair’s strong leadership at our Federal mine and at other Patriot operations over the past 12 years. We thank Blair for his many contributions to the Company and wish him well in his retirement.”
Patriot Coal Corporation is a leading producer and marketer of coal in the eastern United States, with 14 current mining complexes in Appalachia and the Illinois Basin. The Company ships to domestic and international electric utilities, industrial users and metallurgical coal customers, and controls approximately 1.8 billion tons of proven and probable coal reserves.
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