The recent metallurgical coal price increase has boosted the project economics of Jameson Resources’ Crown Mountain project in British Columbia, Canada, prompting the company to move forward with updating its prefeasibility study (PFS).
The PFS currently assumes a benchmark metallurgical coal prices of US$170 per tonne for the first four years of operation and US$190 per tonne thereafter. Both assumed prices are below the 4Q16 settlement price of US$200 per tonne.
A lower current exchange rate than that assumed in the PFS also benefits the project, increased the Canadian dollar sales price by 40%. The combined impact of higher sales price and current exchange rate has boosted the Canadian dollar sales prices from the CAD$185 per tonne assumed in the PFS to CAD$263 per tonne.
In addition to the more positive economic conditions for the project, Jameson said it was also targeting “significant reductions in both CAPEX and OPEX resulting from several potential savings identified over the past two years”.
“A lower CAPEX will more favourably position James in attracting investors/financing, while a reduced OPEX will serve to establish Crown Mountain as a low-cost producer capable of not only thriving in good coal markets, but operating profitably in poor markets as well,” the company concluded.
Read the article online at: https://www.worldcoal.com/exploration-and-development/20102016/crown-mountain-benefits-from-higher-coal-prices/