Grande Cache Coal Corporation

Grande Cache Coal Corporation

December 02, 2009 08:00 ET

Grande Cache Coal Corporation Receives Regulatory Approval for New No. 8 Surface Mine and Announces Strategic Expansion Initiative

CALGARY, ALBERTA--(Marketwire - Dec. 2, 2009) - Grande Cache Coal Corporation (TSX:GCE) ("Grande Cache Coal" or the "Corporation") is pleased to announce that it has received the remaining regulatory approvals necessary to proceed with the development of its new No. 8 surface mine. The Corporation has been mobilizing equipment, manpower and contractors over the last several months in anticipation of receiving these approvals and as a result will immediately commence development and mining activities at the new mining area. The Corporation expects to be producing coal from No. 8 surface mine during the first quarter of fiscal 2011, which begins April 1, 2010.

"The approval of the No. 8 surface mine is an important milestone in the ongoing development of our company" said Robert Stan, Grande Cache Coal's President and Chief Executive Officer. "This approval is the result of an exhaustive process, including detailed technical and environmental design, local consultation, and regulatory review. The No. 8 mine will provide us with over ten years of good quality surface mining resources and long term certainty for our employees, customers and the town of Grande Cache." The final regulatory approvals will include an amended mine permit and a new license for the No. 8 surface mine from the Energy Resources Conservation Board and an amended approval pursuant to the Environmental Protection and Enhancement Act (Alberta) issued by Alberta Environment.

The Corporation also announced today that its Board of Directors has approved a strategic expansion plan to increase clean coal production levels at the existing mine site to three million tonnes per year within the next three fiscal years. A significant portion of the plant and equipment required to meet this strategic expansion plan already exists at the current operation. The strategic plan will require total capital expenditures of approximately $180 million, 60% of which relates to the increased production, over the next three fiscal years to complete the expansion initiative. 

Mr. Stan continued, "With approval to mine in No. 8 mine we are excited about the opportunity to increase production at a time when demand for seaborne coking coal is strengthening and new markets are emerging. We believe our company is well positioned to grow our existing operations in a fiscally disciplined manner and capitalize on the international demand for metallurgical coal." 

Grande Cache Coal is an Alberta based metallurgical coal mining company whose experienced team of coal professionals are managing a mine that produces metallurgical coal for the steel industry and holds coal leases covering over 22,000 hectares in the Smoky River Coalfield located in west-central Alberta. Grande Cache Coal's common shares are listed on the Toronto Stock Exchange under the trading symbol "GCE".

Forward-Looking Statement Advisory

In the interest of providing Grande Cache Coal's shareholders and potential investors with information regarding Grande Cache Coal, including management's assessment of Grande Cache Coal's future plans and operations, certain statements in this news release are "forward-looking statements" within the meaning of applicable Canadian securities legislation. In some cases, forward-looking statements can be identified by terminology such as "anticipate", "believe", "continue", "could", "estimate", "expect", "forecast", "intend", "may", "objective", "ongoing", "outlook", "potential", "project", "plan", "should", "target", "would", "will" or similar words suggesting future outcomes, events or performance. The forward-looking statements contained in this news release speak only as of the date of this document and are expressly qualified by this cautionary statement.

Specifically, this news release contains forward-looking statements relating to: the timing of production of coal from the No. 8 surface mine, the amount and timing of the capital expenditures required to increase production levels to three million tonnes per year; and future coal production levels.

These forward-looking statements are based on certain key assumptions regarding, among other things: no material disruption in production; no material variation in anticipated coal sales volumes; no material variations in markets and pricing of metallurgical coal other than anticipated variations; no material variation in the anticipated timing of equipment delivery; continued availability of and no material disruption in rail service and port facilities; no material delays in the current timing for completion of ongoing projects; financing will be available on terms favourable to the Corporation; no material variation in historical coal purchasing practises of customers; coal sales contracts will be entered into with new customers; parties execute and deliver contracts currently under negotiation; and no material variations in the current regulatory environment. The reader is cautioned that such assumptions, although considered reasonable by Grande Cache Coal at the time of preparation, may prove to be incorrect.

Actual results achieved during the forecast period will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. Such factors include, but are not limited to: changes in general economic, market and business conditions; uncertainties associated with estimating the quantity and quality of coal reserves and resources; commodity prices, currency exchange rates, the availability of credit facilities for capital expenditure requirements, debt service requirements; dependence on a single rail system; changes to legislation; liabilities inherent in coal mine development and production; competition for, among other things, capital, acquisitions of reserves, undeveloped lands and skilled personnel; geological, mining and processing technical problems; ability to obtain required mine licenses, mine permits and regulatory approvals required to proceed with mining and coal processing operations; ability to comply with current and future environmental and other laws; actions by governmental or regulatory authorities including increasing taxes and changes in other regulations; and the occurrence of unexpected events involved in coal mine development and production; and other factors, many of which are beyond the control of Grande Cache Coal. These risk factors are discussed in Grande Cache Coal's Annual Information Form for the fiscal year ended March 31, 2009, as filed with Canadian securities regulatory authorities.

There is no representation by Grande Cache Coal that actual results achieved during the forecast period will be the same in whole or in part as those forecast and Grande Cache Coal does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities law.

The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.

Contact Information

  • Grande Cache Coal Corporation
    Ian Bootle
    Vice President, Finance and Chief Financial Officer
    (403) 543-7070
    (403) 543-7092 (FAX)