Allegiance Coal Ltd has provided an update on progress relating to its review of the staged production pre-feasibility study (staged production PFS) – the results of which were released to the market on 3 July 2017 – for the Telkwa metallurgical coal project and on completion and delivery of results to the market of the stage 1 pre-feasibility study (stage 1 PFS).
The staged production PFS review is complete, and the company believes it has achieved a material reduction in the stage 1 start-up capital, originally estimated at US$51 million, currently estimated at US$36 million.
SRK Consulting (Canada) Inc. (SRK), who prepared the staged production PFS, have been retained to prepare the stage 1 PFS for the company. SRK are incorporating the reduced capital expenditure into the stage 1 PFS, and the company will quantify and explain the reductions in its market release of the stage 1 PFS results.
The capital reductions do not relate to financing or leasing of the mining equipment or the coal wash plant, which remain 100% equity funded in the Stage 1 PFS.
Stage 1 pre-feasibility study
The stage 1 PFS is the blueprint for the commencement of development of the project, and will form the basis of the company’s project description to the Ministry of Energy & Mines, in its Sub-EA permit applications, in its engagement with First Nations, and in its consultation with other key stakeholders.
The company intends to now expedite completion and delivery of the stage 1 PFS. Previously the company had announced to the market that the Stage 1 PFS would be completed and delivered in 1Q18. However, the company has indicated that the results of the stage 1 PFS will be completed and delivered to the market on or before 30 September 2017.