Prophecy Coal Corp. (TSX:PCY,OTCQX:PRPCF,FWB:1P2) entered into binding coal sales contract with a number of buyers in the last 60 days. This will involve the sale of over 30,000 tonnes of coal per month (annualized rate of over 360,000 tonnes) from the Company’s Ulaan Ovoo mine. Prophecy Coal aims to restart mining at Ulaan Ovoo by November 2013.
As quoted in the press release:
The buyers include cement plants, a metallurgical plant, a heat plant, chemical plants and Russian traders. The off-take quantity and variety of customers reflect the Company’s significant efforts to drive higher margin sales while satisfying government power plant needs, which are excluded from the 30,000 tonnes per month forecast. All sales require pre-payment, as has been the Company’s practice since January 2013.
The Company cautions that mining operation of Ulaan Ovoo mine has been curtailed since July 2012. Some orders will be delivered in August and September from the existing coal stockpile. Fulfilling all the off-take agreements is contingent on a mine restart, which requires time and capital expenditures. The Company has installed significant water-pumping capacity at the mine site and will soon start pit-dewatering, aiming to start mining fresh coal by November 2013 and thereafter on a continued basis.