The Globe and Mail reported that Anglo American plc (LSE:AAL) will today announce plans to expand its coal mine in Northeastern BC in the hope that the quality of the fuel, along with the mine’s proximity to Asia, will help it win contracts from steelmakers.
As quoted in the market news:
The company has budgeted $50-million for the first phase of a $200-million, multiyear project to boost output of coking (or metallurgical) coal, a key ingredient in the production of steel.
The expansion is occurring even though coking coal prices have plunged more than 50 per cent over the past two years, to $147 (U.S.) a tonne.
Current output of 1.5 million tonnes a year of metallurgical coal at the B.C. venture is expected to rise after the initial expansion is completed in the first quarter of 2014, clearing the way for a production rate of 2.5 million tonnes annually, Mr. French said. Total output may rise to as much as four million tonnes a year in subsequent phases.