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15/04/2024
Mining News

Prairie Mining study signals world-class coking coal project in Poland

Prairie Mining’s scoping study has illustrated the potential technical viability and robust economics for its Debiensko hard coking coal project in Poland.

The company’s shares were last trading 17% higher intra-day, at $0.55.

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With a JORC resource of 301 million tonnes of hard coking coal, Debiensko has the potential to be a large scale, low cost and long-life supplier into Europe.

Prairie Mining has projected a life of mine production of 65 million tonnes of hard coking coal over 26 years, with an average production of 2.6 million tonnes per annum.

Significantly, cash costs of circa US$47 per tonne could potentially position Debiensko amongst the lowest cost suppliers of hard coking coal into key European markets.

The projected pre-tax net present value of the Debiensko project is US$1.5 billion at an 8% discount rate.

Prairie can gain from favourable market fundamentals as Europe continues to consume 47 million tonnes of hard coking coal annually, 85% of which is imported.

Debiensko coking coal is expected to enjoy strong demand from steelmakers, with substantial netback pricing advantages given its proximity to regional customers.

Furthermore, Prairie can leverage the existing infrastructure at the Debiensko mine site, potentially resulting in low capital intensity of US$197 per tonne of annual saleable production.

This compares favourably with the industry average of over US$401 per tonne for global hard coking coal mines developed in the last decade.

Prairie will commence an infill drilling program of up to six boreholes during 2017.

This will enable further delineation of measured and indicated resources to support the next stage of project studies.

Source: Proactive investors

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