| ||January 25, 2011|
CanAm Coal Provides Coal Pricing & Corporate Update
| ||Calgary, AB - 25 January, 2011 - CanAm Coal Corp. (TSXV: COE) ("CanAm" or the "Company") is pleased to provide a 2011 coal pricing and corporate update.|
2011 Coal Pricing
As a consequence of the strong coal markets, starting in January 2011, RAC Mining LLC's ("RAC") Blue Creek metallurgical coal production is currently being sold on the spot market and into a one year contract at prices which are on average between 13% and 18% higher than 2010 prices. At targeted 2011 levels, 60% of the company's metallurgical coal production is under contract and RAC will look for further opportunities to take advantage of the strong pricing environment.
RAC Operations Update
On November 8, 2010, the Company completed the acquisition of 49% in RAC Mining LLC, providing CanAm with a 98% controlling interest. Since that time efforts have been underway to improve productivity and increase production while lowering the cost of production. Since the acquisition, RAC also purchased US$1.3 million in additional production and maintenance equipment. Equipment acquired included a Komatsu D475 dozer for overburden removal, a Drilltech DK-50 blast hole drill for overburden drilling and blasting operations and a Mack 7 reel fuel and lube truck for the maintenance operations at the mine. Additionally, the undercarriage of RAC's existing Komatsu D475 production dozer was replaced which will increase mechanical availability, dozer production and efficiency. Several other ancillary pieces of equipment were also acquired such as light plants, maintenance tools and supplies. This equipment supplements RAC's existing fleet of: Komatsu 1800 excavator, 2 100 ton Komatsu haul trucks, D475 Komatsu dozer, 2 Cat D10 Dozers, 2 Cat 980 loaders, 2 60 ton Terex haul trucks, 2 40 ton Volvo articulated haul trucks, an Ingersoll Rand blast hole drill and a Cat 375 excavator.
"Transition of the operations and management has now generally been completed and production from the surface mine is expected to reach management estimates by the end of Q1 and steady production increases are being realized daily toward that goal" said Tim Bergen, CEO of CanAm.
Buick Coal Project Update
The Buick Coal Project holds significant coal resources estimated at 291 million tons, 188 million tons indicated and 103 million tons inferred lignite coal resources, in Colorado, USA (see the technical report entitled "Limon Lignite Project, Elbert County, Colorado, USA," dated October 26, 2007 and filed on SEDAR on November 2, 2007) and with the advent of new clean coal technologies, the prospects for the development of this deposit have improved significantly. In addition to pursuing the development of Buick with CanAm's licensed Coal to Liquids technology, which is awaiting Chinese government approval for export, the Company is reviewing the commission of a broader study to determine all alternatives available for the development of Buick. The study would include looking at the following technologies: coal to gas (CTG), coal to methanol (CTM), coal to Liquids (CTL), coal Beneficiation, and coal to gas to electricity (IGCC).
Other Coal Opportunities
The Company continues to evaluate other mining opportunities in the Appalachia region of the United States of America and in particular in the state of Alabama. With the strong thermal and met coal markets and the increasing pricing environment for their products, management is committed to expanding its current portfolio of coal assets through strategic acquisitions and/or alliances with local coal producers.
About CanAm Coal Corp.
CanAm is a coal producer and development company focused on growth through the acquisition, exploration and development of coal resources and resource-related technologies. CanAm's main activities and assets include its Alabama coal mine operations, the exclusive rights to a proprietary Coal to Liquids technology which converts coal into liquid fuels (such as oil, jet fuel) at an economical cost with zero airborne emissions and the Buick Coal Project which holds significant coal resources, 188 million indicated and 103 million inferred resources, in Colorado, USA (see the technical report entitled "Limon Lignite Project, Elbert County, Colorado, USA," dated October 26, 2007 and filed on SEDAR on November 2, 2007). Other coal and related opportunities continue to be evaluated on an ongoing basis.
For Further Information:
CanAm Corporate Office:
Linden Swensen, President
Toll Free: 1.877.262.5888
Brisco Capital Partners:
Scott Koyich, Partner
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Information and Statements
This press release contains certain forward looking statements and forward looking information (collectively referred to herein as "forward looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward looking statements. Forward looking statements are often, but not always, identified by the use of words such as "could", "should", "can", "anticipate", "estimate", "expect", "believe", "will", "may", "project", "budget", "plan", "sustain", "continues", "strategy", "forecast", "potential", "projects", "grow", "take advantage", "well positioned" or similar words suggesting future outcomes. In particular, this press release contains forward looking statements relating to: the future production of the Powhatan mine; the permitting of the Davis mine; and the potential production at the Davis mine. This forward looking information is based on management's estimates considering typical strip mining operations, equipment requirements and availability and typical permitting timelines.
In addition, forward looking statements regarding the Company are based on certain key expectations and assumptions of the Company concerning anticipated financial performance, business prospects, strategies, the sufficiency of budgeted capital expenditures in carrying out planned activities, the availability and cost of services, the ability to obtain financing on acceptable terms, the actual results of exploration projects being equivalent to or better than estimated results in technical reports or prior exploration results, and future costs and expenses being based on historical costs and expenses, adjusted for inflation, all of which are subject to change based on market conditions and potential timing delays. Although management of the Company consider these assumptions to be reasonable based on information currently available to them, these assumptions may prove to be incorrect.
By their very nature, forward looking statements involve inherent risks and uncertainties (both general and specific) and risks that forward looking statements will not be achieved. Undue reliance should not be placed on forward looking statements, as a number of important factors could cause the actual results to differ materially from the Company's beliefs, plans, objectives and expectations, including, among other things: general economic and market factors, including business competition, changes in government regulations or in tax laws; the early stage development of the Company and its projects; general political and social uncertainties; commodity prices; the actual results of current exploration and development or operational activities; changes in project parameters as plans continue to be refined; accidents and other risks inherent in the mining industry; lack of insurance; delay or failure to receive board or regulatory approvals; changes in legislation, including environmental legislation, affecting the Company; timing and availability of external financing on acceptable terms; conclusions of economic evaluations; and lack of qualified, skilled labour or loss of key individuals. These factors should not be considered exhaustive. Many of these risk factors are beyond the Company's control and each contributes to the possibility that the forward-looking statements will not occur or that actual results, performance or achievements may differ materially from those expressed or implied by such statements. The impact of any one risk, uncertainty or factor on a particular forward-looking statement is not determinable with certainty as these risks, uncertainties and factors are interdependent and management's future course of action depends upon the Company's assessment of all information available at that time.
Forward -looking statements in respect of the future production of the Powhatan mine may be considered a financial outlook. These forward-looking statements were approved by management of the Company on January 17, 2011. The purpose of this information is to provide an operational update on the company's activities and strategies and this information may not be appropriate for other purposes.
The forward looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward looking statements included in this press release are made as of the date of this press release and the Company does not undertake and is not obligated to publicly update such forward looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.
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